Arbitral Tribunal November 16, 1957. [1]

(Petren, President; Bolla, De Luna, Reuter, De Visscher).

THE FACTS — This arbitration concerned the use of the waters of Lake Lanoux, in the Pyrenees. Briefly, the French Government proposed to carry out certain works for the utilization of the waters of the lake and the Spanish Government feared that these works would adversely affect Spanish rights and interests, contrary to the Treaty of Bayonne of May 26, 1866, between France and Spain and the Additional Act of the same date. In any event, it was claimed that, under the Treaty, such works could not be undertaken without the previous agreement of both parties.

Lake Lanoux lies on the southern slopes of the Pyrenees, on French territory. [Fn 2 — The planned diversion amounts to 25% of the entire of the flow of the carol, the water of which is used in Spain by 18,000 farmers]. It is fed by streams which have their source in French territory and which run entirely through French territory.
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[The two relevant provisions of the Treaty of Bayonne are:]

“Article 10: If, after having satisfied the actual needs of users recognized on each side respectively as regular, there remains at low tide water available where the frontier is crossed, such water will be shared in advance between the two countries, in proportion to the areas of the irrigable lands belonging to the immediate respective riparian owners, minus land already irrigated.

“Article 11: When in one of the two States it is proposed to construct works or to grant new concessions which might change the course or the volume of a watercourse of which the lower or opposite part is being used by the riparian owners of the other country, prior notice will be given to the highest administrative authority of the Department or of the Province to which such riparian owners are subject by the corresponding authority in the jurisdiction where such schemes are proposed, so that, if they might threaten the rights of the riparian owners of the adjoining Sovereignty, a claim may be lodged in due time with the competent authorities, and thus the interests that may be involved on both sides will be safeguarded. If the work and concessions are to take place in a Commune contiguous to the border, the engineers of the other Country will have the option, upon proper notice given to them reasonably in advance, of agreeing to inspect the site with those in charge of it.

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The Spanish Government asked the Tribunal to declare that the French Government should not execute works for the utilization of the waters of Lake Lanoux in accordance with the modalities and guarantees provided in the Electricite de France project, for if no agreement were previously arrived at between the two Governments on the problem of dealing with the said waters, the French Government would be committing a breach of the relevant provisions of the Treaty of Bayonne of May 26, 1866, and the Additional Act of the same date.

The French Government asked the Tribunal to declare that it was correct in maintaining that in carrying out, without an agreement previously arrived at between the two Governments, works for the utilization of the waters of Lake Lanoux on the conditions laid down in the French project and proposals mentioned in the Compromis (Arbitration Agreement) of November 19, 1956, it was not committing a breach of the Treaty of Bayonne of May 26, 1866, and the Additional Act of the same date.

“As to question (B):

“In the Compromis, the Spanish Government had already declared that, in its opinion, the French scheme required for its execution ‘the previous agreement of both Governments, in the absence of which the country making the proposal is not at liberty to undertake the works’.

“In the written as well as the oral proceedings, that Government developed this point of view, completing it by the recital of the principles which ought to govern dealings leading to such prior agreement. Two obligations, therefore, would seem to rest upon the State which desires to undertake the works envisaged, the more important being to reach a prior agreement with the other interested State; the other, which is merely accessory there to, being to respect the other rules laid down by Article II of the Additional Act.

“The argument put forward by the Spanish Government is stated on two planes — the Spanish Government takes its stand, on the one hand, on the Treaty and the Additional Act, on the other hand on the system of faceries or compascuites which exists an the Pyrenean frontier, as well as on the rules of international common law. The two latter sources would permit, first of all, the interpretation of the Treaty and the Additional Act of 1866, and then, in a larger perspective, the demonstration of the existence of an unwritten general rule of international law. The latter (it is contended) has precedents which would permit its establishment in the traditions of the system of faceries, in the provisions of the Pyrenean Treaties and in the international practice of States in the matter of the industrial use of international watercourses.

“II. Before proceeding to an examination of the Spanish argument, the Tribunal believes it will be useful to make same very general observations on the nature of the obligations invoked against the French Government. To admit that jurisdiction in a certain field can no longer be exercised except the condition of, or by way of, on agreement between two States is to place an essential restriction an the sovereignty of a State, and such restriction could only be admitted if there were clear and convincing evidence. Without doubt, international practice does reveal some special cases in which this hypothesis has became reality; thus, sometimes two States exercise conjointly jurisdiction over certain territories (joint ownership, co-imperium, or condominium); likewise, in certain international arrangements, the representatives of States exercise conjointly a certain jurisdiction in the name of those States or in the name of organizations. But these cases are exceptional, and international judicial decisions are slow to recognize their existence, especially when they impair the territorial sovereignty of a State, as would be the case in the present matter.

“In effect, in order to appreciate in its essence the necessity for prior agreement, one must envisage the hypothesis in which the interested States cannot reach agreement. In such case, it must be admitted that the State which is normally competent has lost its right to act alone as a result of the unconditional and arbitrary opposition of another State. This amounts to admitting a ‘ right of assent’, a ‘right of veto’, which at the discretion of one State paralyses the exercise of the territorial jurisdiction of another.

“That is why international practice prefers to resort to less extreme solutions by confining itself to obliging the States to seek, by preliminary negotiations, terms for an agreement, without subordinating the exercise of their competences to the conclusion of such an agreement. Thus, one speaks, although often inaccurately, of the, obligation of negotiating an agreement ‘. In reality, the engagements thus undertaken by States take very diverse forms and have a scope which varies according to the manner in which they are defined and according to the procedures intended for their execution; but the reality of the obligations thus undertaken is incontestable and sanctions can be applied in the event, for example, of an unjustified breaking off of the discussions, abnormal delays, disregard of the agreed procedures, systematic refusals to take into consideration adverse proposals or interests, and, more generally, in cases of violation of the rules of good faith (Tacna-Arica Arbitration: Reports of International Arbitral Awards, vol. II, pp. 921 et seq. ;[1] Case of Railway Traffic between Lithuania and Poland: P.C.I.J., Series A/B, No. 42, pp. 108 et seq.[2]).

“In the light of these general observations, and in relation to the present case, we will now examine in turn whether a prior agreement is necessary and whether the other rules laid down by Article II of the Additional Act have been observed.

“A. The necessity for a prior agreement.

“12. First, to enquire whether the argument that the execution of the French scheme is subject to the prior agreement of the Spanish Government is justified in relation to the system of compascuites or faceries or in relation to international common law; the collected evidence would permit, if necessary, the interpretation of the Treaty and the Additional Act of 1866, or rather, according to the wider formula given in the Spanish argument, to affirm the existence of a general principle of law, or of a custom, the recognition of which, inter alia, is embodied in the Treaty and the Additional Act of 1866 (Spanish Memorial, p. 81).
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“13. The Spanish Government endeavoured to establish similarly the content of current positive international law. Certain principles which it demonstrates are, assuming the demonstration to be accepted, of no interest for the problem now under examination. Thus, if it is admitted that there is a principle which prohibits the upstream State from altering the waters of a river in such a fashion as seriously to prejudice the downstream State, such a principle would have no application to the present case, because it has been admitted by the Tribunal, in connection with the first question examined above, that the French scheme will not alter the waters of the Carol. In fact, States are today perfectly conscious of the importance of the conflicting interests brought into play by the industrial use of international rivers, and of the necessity to reconcile them by mutual concessions. The only way to arrive at such compromises of interests is to conclude agreements on an increasingly comprehensive basis. International practice reflects the conviction that States ought to strive to conclude such agreements: there would thus appear to be an obligation to accept in good faith all communications and contracts which could, by a broad comparison of interests and by reciprocal good will, provide States with the best conditions for concluding agreements. This point will be referred to again later on, when enquiring what obligations rest on France and Spain in connection with the contracts and the communications preceding the putting in hand of a scheme such as that relating to Lake Lanoux.

“But international practice does not so far permit more than the following conclusion: the rule that States may utilize the hydraulic power of international watercourses only on condition of a prior agreement between the interested States cannot be established as a custom, even less as a general principle of law. The history of the formulation of the multilateral Convention signed at Geneva on December 9, 1923, relative to the Development of Hydraulic Power Affecting More than One State, is very characteristic in this connection. The initial project was based on the obligatory and paramount character of agreements whose purpose was to harness the hydraulic forces of international watercourses. But this formulation was rejected, and the Convention, in its final form, provides (Article I) that

‘[The present Convention] in no way alters the freedom of each State, within the framework of international law, to carry out on its territory all operations for the development of hydraulic power which it desires’;

there is provided only an obligation upon the interested signatory States to join in a common study of a development programme; the execution of this programme is obligatory only for those States which have formally subscribed to it.

“Customary international law, like the traditional Law of the Pyrenees, does not supply evidence of a kind to orient the interpretation of the Treaty and of the Additional Act of 1866 in the direction of favoring the necessity for prior agreement; even less does it permit us to conclude that there exists a general principle of law or a custom to this effect.

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“22. The content of the second obligation is more difficult to determine. The’ claims’ mentioned in Article II are related to the various rights protected by the Additional Act, but the essential problem is to ascertain how’ all the interests that may be involved on both sides’ ought to be safeguarded.

“It must first be determined what are the ‘interests’ which have to be safeguarded. A strict interpretation of Article II would permit the reading that the only interests are those which correspond with a riparian right. However, various considerations which have already been explained by the Tribunal lead to a more liberal interpretation. Account must be taken of all interests, of whatsoever nature, which are liable to be affected by the works undertaken, even if they do not correspond to a right. Only such a solution complies with the terms of Article 16, with the spirit of the Pyrenees Treaties, and with the tendencies which are manifested in instances of hydroelectric development in current international practice.

“The second question is to determine the method by which these interests can be safeguarded. If that method necessarily involves communications, it cannot be confined to purely formal requirements, such as taking note of complaints, protests or representations made by the downstream State. The Tribunal is of the opinion that:” according to the rules of good faith, the upstream State is under the obligation to take into consideration the various interests involved, to seek to give them every satisfaction compatible with the pursuit of its own interests, and to show that in this regard it is genuinely concerned to reconcile the interests of the other riparian State with its own.
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[1] Found also at 24 International Law Reports 101 (1957).

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