The Dispute Settlement Mechanisms in Major Multilateral Treaties

Although dispute settlement mechanisms providing for compulsory referral to a third party are rarely used, their presence can, and usually do, have a major underlying influence over the actions of States, which are typically anxious to avoid lengthy and expensive dispute settlement procedures. We undertook a quantitative analysis of the dispute settlement mechanisms of 236 major multilateral treaties and found that most of the multilateral treaties provide for compulsory referral to a third party (ie, they can be triggered without the consent of both disputing parties). Of those treaties, the majority provide for compulsory referral to an arbitral tribunal. These findings are significant, as they debunk the myth that treaties providing for compulsory referral to a third party are uncommon.

This paper also looks at the various compromise solutions that have been developed over the years in response to State disagreement over whether to include compulsory third party mechanisms in treaties, as well as the number of treaties that contain voluntary and non-third party dispute settlement mechanisms. This analysis will enable a better understanding of the different types of dispute settlement mechanisms found in multilateral treaties and their background and purpose. We also hope that this paper will be useful for those involved in the negotiation of dispute settlement provisions in future multilateral agreements.