*Dr. Mehrdad Mohamadi
Dispute settlement in international aviation is of paramount importance given the special characteristics of aviation industry. Although there are many laws and regulations in place at both national and international levels, the way they are interpreted and the existing gaps can lead to complexities that make it difficult to resolve disputes. Admittedly, international disputes in aviation have been less compared to other areas of international litigation. States usually prefer to resolve their differences through the diplomatic channels. However, legal disputes in the field of aviation are inevitable, and over the years these disputes have been referred to various authorities such as the International Civil Aviation Organisation (ICAO) Council, the International Court of Justice (ICJ), ad-hoc and institutional arbitration, and the WTO dispute settlement body.
International disputes over air law matters cover a wide range of issues, most notably violations of the obligations under the Chicago Convention and other air law instruments. For example, in the Airbus case before the ICJ (Iran v. US), Iran started proceedings against the US and its requests for relief from the Court were as follows: Appeal against the ICAO’s decision of 17 March 1989, Violation of Civil Aviation Safety (Montreal) Convention by the US government resulting from the destruction of an Iran-Air airliner; Determination of the amount of compensation payable by the US government. The Iran submitted an application to the court on May 17, 1989, and subsequently submitted its memorial on July 24, 1990, however, after the withdrawal of the case by Iran and agreement to receive compensation, the opportunity to settle one of the most controversial air cases in the International Court of Justice was lost. Besides, arbitration is used as a favorable means of dispute settlement, and the arbitration clause is included in many bilateral air agreements. Below is a brief review of three of the most prominent dispute resolution methods in aviation disputes.
The Chicago Convention on Civil Aviation (December 7, 1944), together with its 19 annexes, is the fundamental legal document governing international aviation. The purpose of the convention is to develop a global mechanism for regulating international air transport. Chapter 8 of the Chicago Convention plays a key role in resolving air disputes between states parties. This chapter has given the ICAO Council judicial powers. Article 84 of the Chicago Convention provides that “If any disagreement between two or more contracting States relating to the interpretation or application of this Convention and its Annexes cannot be settled by negotiation, it shall, on the application of any State concerned in the disagreement, be decided by the Council. No member of the Council shall vote in the consideration by the Council of any dispute to which it is a party. Any contracting State may, subject to Article 85, appeal from the decision of the Council to an ad hoc arbitral tribunal agreed upon with the other parties to the dispute or to the Permanent Court of International Justice.”
In a recent and significant case, the state of Qatar on October 30, 2017 submitted an application to resolve the dispute with the four states of Saudi Arabia, the United Arab Emirates, Egypt and Bahrain. Qatar’s application, based on Chapter 8 of the Chicago Convention and the rules of procedure of the ICAO Dispute Resolution, relates to the violation of the Chicago Convention following four states banning aircrafts registered in Qatar from/to the airports of the four respondent countries as well as crossing their airspace and the Flight Information Regions of the respondent states. The ICAO council after deliberations announced its decision to reject the preliminary objections of the respondent states and this led the respondent states to appeal before the ICJ.
THE INTERNATIONAL COURT OF JUSTICE (ICJ)
Compared to other cases, the International Court of Justice has not had much opportunity to deal with cases of air disputes between states. For instance, one of the most controversial cases in this court was the case of Iranian Airbus, which was finally removed from the court’s agenda following the agreement of the parties. Currently, the appeal of four states of Saudi Arabia, the UAE, Bahrain and Egypt against the decision of the ICAO Council is the most important case of air disputes that the court has not yet decided on.
Probably, the most significant obstacle to the Court’s handling of potential cases is the issue of jurisdiction and the consent of states to refer the cases to the Court, as governments have refused to refer disputes to this international tribunal. The jurisdiction of the International Court of Justice to deal with international disputes is set out in Article 36 of the Statute of the Court. Negotiation is by far the most common means of addressing international differences, while adjudication is perhaps the most severe alternative approach to resolving disputes – one that historically has been invoked sparingly.
The parties to the disputes, for a number of reasons, prefer to refrain from referring the dispute to the courts and opt for more flexible solutions. Hence, there is an increase in recourse to arbitration as a desirable means of resolving disputes. Among the advantages of this method are the selection of arbitrator(s), the enforceability of the arbitration award, flexibility of the arbitration process, the speed of the proceedings and the more specialized nature of the proceedings. Today, arbitration, especially in bilateral air services agreements, has become commonplace. For example, the air transport agreement between Iran and Qatar in its article 16 provides that: “… If the Contracting Parties fail to resolve the dispute in accordance with paragraphs 1 and 2 above, the dispute shall be referred to an arbitral tribunal….” In fact, since the Bermuda 1 agreement, states have largely avoided referring disputes to the ICAO Council in bilateral agreements and have chosen arbitration. There are different reasons for this, such as specialization and experience of the judges, the selectivity of the judges and the prevailing rules and regulations, and the confidentiality of arbitration proceedings, which is crucial in many international disputes.
In the case of lawsuits filed by a non-governmental party, different regulations can be selected to resolve disputes. The International Air Transport Association (IATA) has developed rules for arbitration, in thirty-two articles and two annexes for use in arbitration between the parties who wish to resolve their disputes in accordance with the IATA Arbitration Rules. There are also other options available for resolving disputes through arbitration like ICC arbitration rules and UNCITRAL arbitration rules.
Dr. Mohamadi, PHD International Law. He is an international legal advisor specializing in International Air Law, Arbitration and Dispute Settlement and can be reached at email@example.com