An Introduction to the Trump Effect on the Future of Global Dispute Resolution

Abstract

Following World War II, the international community crafted a new worldview. Driven by a philosophy of transnationalism, States designed a modern framework for international relations. They collectively agreed to no longer tolerate unilateral tactics, such as coercion, sanctions, or sheer force, to compel submission to individual ambitions and desires. Instead, States adopted transnational rules. These are derived from multilateral and bilateral agreements, systems of global trade, established international norms, and decisions by international tribunals. U.S. leadership was key to establishing and encouraging acquiescence to this system. On many levels this transnational legal system has been a success. It informs approaches to international affairs, human rights, foreign policy, business transactions, and related disputes.

Yet recent years have seen an increasing return to unilateralism and “go it alone” attitudes. Perhaps history will show that, here too, the U.S. has been a leader. Since January 2017, the policies and ideologies of the Trump Administration have consistently challenged the modern transnational legal system and the future of global dispute resolution.

Keywords: extraterritoriality, Trump, dispute resolution, NAFTA, USMCA, WTO, sanctions, arbitration, trade, international arbitration, international affairs, foreign policy, international law, global affairs, ISDS, investor-state dispute settlement

JEL Classification: K33, K41