The Doctrine of Odious Debt in International Law: A Restatement

89 Pages Posted: 8 Nov 2007

See all articles by Jeff King

Jeff King

Faculty of Laws, University College London

Date Written: January 21, 2007

Abstract

There has been a revival in interest in the doctrine of odious debt in legal, policy and economic quarters. Building on the author's earlier work and recently published article, this study provides a restatement of the odious debt doctrine and renewed examination of its legal foundations. It concludes that the doctrine may be defined coherently, that it has more extensive support in international relations and international law than originally suggested, and can be modified to accommodate some of the practical problems one would expect to encounter in trying to apply it consistently.

In Part II, the paper reviews the status of what is called the 'rule of repayment' in the international law of government and state succession. It finds that the rules are subject to significant qualification, quite apart from the odious debt doctrine. It also argues that the odious debt doctrine must be seen as an exception to the rule of repayment and that critics have misunderstood the nature of the burden of proof. There is no need to demonstrate that the doctrine has met the onerous thresholds of general practice accepted as law, but, rather, that those asserting the enforceability of odious debts must meet such standards. It will be seen in Part IV that there is sufficient variety in state practice to undermine the rule of repayment in most categories of odious debt.

Part III restates three influential definitions of odious debt, and then settles on a contemporary definition. It then proposes that for the sake of conceptual clarity, it is necessary to divide the various kinds of odious debt into four categories: war debts; subjugation debts; illegal occupation debts; and fraudulent, illegal and corruption debts.

In Part IV, I present the bulk of evidence in international law in favour of the existence of an odious debt exception to the rule of repayment. This section shows that there is a very substantial amount of authority in the recognised sources of international law for the basic elements of the odious debts claim. Indeed, it is concluded that war debts in cases of state succession, subjugation debts in the case of state succession, all illegal occupation debts, and all fraudulent, illegal or corruption debts are unenforceable under international law. The unclear categories remaining include illegal war debts in cases of state and government succession, and, quite notably, subjugation debts in cases of government succession. The bulk of authority has historically viewed subjugation debts in cases of government succession as legally enforceable. However, I nonetheless argue that even in this category, due to recent developments in international law and state practise, it is appropriate to recognise that the non-enforceability of subjugation debts in cases of government succession may be in statu nascendi.

Part V reviews some of the common policy concerns associated with the doctrine. It concludes that none of them render the doctrine unworkable.

Keywords: odious debt, international debt, sovereign debt, international law, state succession

JEL Classification: K10, K30, K33

Suggested Citation

King, Jeff, The Doctrine of Odious Debt in International Law: A Restatement (January 21, 2007). Available at SSRN: https://ssrn.com/abstract=1027682 or http://dx.doi.org/10.2139/ssrn.1027682

Jeff King (Contact Author)

Faculty of Laws, University College London ( email )

Bentham House
Endsleigh Gardens
London WC1E OEG, WC1E 6BT
United Kingdom

HOME PAGE: http://https://www.ucl.ac.uk/laws/people/prof-jeff-king

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
916
Abstract Views
4,895
rank
38,149
PlumX Metrics