STATEMENT BY MR. LIONEL YEE, DIRECTOR-GENERAL, INTERNATIONAL AFFAIRS DIVISION, ATTORNEY-GENERAL'S CHAMBERS OF SINGAPORE, ON AGENDA ITEM 79, ON CHAPTERS X, XI AND XII OF THE REPORT OF THE INTERNATIONAL LAW COMMISSION ON THE WORK OF ITS 62ND SESSION, SIXTH COMMITTEE, 1 NOVEMBER 2010

STATEMENT BY MR. LIONEL YEE, DIRECTOR-GENERAL, INTERNATIONAL AFFAIRS DIVISION, ATTORNEY-GENERAL'S CHAMBERS OF SINGAPORE, ON AGENDA ITEM 79, ON CHAPTERS X, XI AND XII OF THE REPORT OF THE INTERNATIONAL LAW COMMISSION ON THE WORK OF ITS 62ND SESSION, SIXTH COMMITTEE, 1 NOVEMBER 2010

Madame Chair,

1. My delegation would like to express its thanks to the Commission for its report on the work conducted on the topics "Treaties over Time", "the Most-Favoured Nation Clause" and "Shared Natural Resources".

Treaties over Time

2. In relation to the topic of "Treaties over Time", I would first like to commend the Chairman of the Study Group on this topic, Mr. Georg Nolte, for producing an introductory report of ambitious breadth. It touches on many of the vital issues in treaty implementation which are of practical importance.

3. Madame Chair, it is often the successful conclusion of a Treaty that grabs headlines and stirs the public imagination. However, as we are all aware, this is merely the birth of the Treaty, and marks the beginning of the arduous task of ensuring that the Treaty is made to work in the way it is intended to.

4. This task is made all the more challenging when the Treaty in question deals with sensitive political issues, such as those relating to territorial boundaries, or has a wide-ranging impact on a country's laws and practices, such as a Free Trade Agreement. Invariably, it is such treaties dealing with sensitive and complex issues that will subsist for a long period of time, given the importance of the issues that are being addressed. Given this - and the range of issues that could possibly be studied - we would suggest that one of the focal points of the report relate to implementation of major treaties.

5. Madame Chair, while we welcome the Study Group to delve deeper into State practice relating to Treaty implementation, we should nevertheless be conscious of the limits of such an exercise. The cornerstone of interpretation remains the wording of the Treaty itself. It is important to remind ourselves that the words of the Treaty are the very embodiment of the balance that the parties to it strove to achieve, and should not be lightly or easily unravelled. At the same time, we are aware that in order to make a Treaty work over time, there may sometimes be need for flexibility and adaptation to changing circumstances. The key issue is what weight to accord to deviations of practice from the wording of the Treaty.

6. Practice may of course be reflective of a shared binding understanding on the part of the parties of how their obligations have been varied subsequent to the conclusion of the Treaty. But this is not always the only conclusion one can reach from the conduct of the parties. First, they may be motivated by reasons of pure political expediency, and as such, may simply not reflect the intent of the parties. Second, what seems to be a departure affecting the interpretation of a Treaty may be temporary, and after some time, revert to a state of conformity with the provisions of the Treaty. Third, practice, and the motivations thereof, are usually not be properly recorded, and while it can sometimes be inferred from particular acts, there are many instances where the exact contours of practice cannot be clearly ascertained.

7. It is therefore our view that while it is vital to examine subsequent practice and its impact on treaties, there are risks involved in allowing practice to easily overcome the wording of a Treaty. In our view, from both the viewpoint of certainty, and in our observation of treaty practice, parties will almost always put in writing any agreement that a Treaty should be amended or implemented in a manner that is different from the wording of the Treaty. This is why it is now common for many complex Treaties to provide special mechanisms, such as a Joint Committee of the relevant Ministers and senior government officials, for the amendment of a Treaty should the need arise. Practice should therefore only amend Treaty in exceptional circumstances.

8. Madame Chair, we conclude by stating that we note the Commission's call for States to provide inputs on their practice in this area, and we will endeavour to do so in order to aid the Commission's work on this important and complex area of international law.

Most-Favoured Nation Clause

9. I turn now to the Most-Favoured-Nation Clause or the "MFN" clause. I would first like to thank the co-chairs of the Study Group on this important topic, Mr. Donald McRae and Mr. Rohan Perrera. We agree with the typological approach taken by the co-chairs in relation to this issue, and also with the expansion of the scope of study to trade in services and intellectual property issues as the focus of international trade law is shifting away from trade in goods to these relatively newer issues. We also concur with Mr. Shinya Murase that the 1978 draft articles of the Commission on this topic requires re-examination, given the recent explosion of MFN clauses in Free Trade Agreements ("FTAs") and Bilateral Investment Treaties ("BITs") and the attendant problems this has created.

10. Madame Chair, Singapore has embarked on Free Trade Agreement negotiations with many different trading partners. We are currently party to close to 20 FTAs, and are in the midst of negotiating others, including one with the EU, and for the Trans-Pacific Partnership Agreement. Concurrently, we have also expanded the number of BITs, in line with the exponential increase of foreign direct investment flows into, and out of, our country.

11. One of the perennial issues we face in negotiating FTAs and BITs relates to the scope of the MFN obligation. In particular, we face considerable uncertainty regarding the interpretation of this clause, given the differing approaches towards these clauses by dispute settlement bodies, in particular investor-State arbitration tribunals, in the last 10 years. The most notorious case is undoubtedly the Maffezini decision. While we recognise that the case involved a loosely worded MFN clause, and that the weight of tribunal decisions in the last few years, led by Salini and Plama cases, appears to have rejected that decision, there remain a handful of cases which have followed the Maffezini decision. As such, an undesirable level of uncertainty still surrounds the ambit of this clause, especially in the area of trade in services and investments. To manage this uncertainty, countries have attempted to insert language in the investment related provisions of their FTAs to specify that procedural rights do not fall within the ambit of the MFN clause. However, it remains to be seen whether tribunals will interpret this provision in the intended manner.

12. Given the number of FTAs and BITs in existence and being negotiated, we urge the Commission to expedite its work on this issue and to provide much needed clarity in this area of law. In our view, this would be of immediate service to the international community given the proliferation of such instruments, and would be a strong demonstration of the leadership of the Commission in an area of international law of practical importance and relevance to many countries.

Shared Natural Resources

13. I now wish to address this meeting on the topic of "Shared Natural Resources". Singapore is in the happy or unhappy position of neither having aquifers nor gas/oil resources - at least none we are aware of at the moment - let alone having to share such aquifers or gas or oil resources with others. But for nations which do have such shared resources, how they are managed is usually of great political and economic significance, and sometimes extends to even a security dimension. The work of the Commission in this regard therefore is of interest not only to the states which are the direct co-beneficiaries of such resources but also to the wider international community as a whole.

14. We have taken note of the recommendation of the Commission that, in view of comments it has received from governments, as well as the considerations identified by Mr. Shinya Murase in his working paper, the Commission should not take up the transboundary oil and gas aspects of this topic and should focus the work essentially on transboundary aquifers. We can go along with this recommendation. While there are similarities between aquifers and oil and gas resources which transcend national boundaries, there are also significant differences. One speaks of human dependence on fresh water for survival in a way that does not so resonate to the same degree in the case of oil and gas resources. And water sources are susceptible to pollutive and environmentally adverse activities in a way that oil and gas resources are not. So it does appear sensible for the work of the Commission to proceed with the draft articles focussed on transboundary aquifers, although if and when the focus does eventually turn to shared oil and gas resources, these articles will form a useful reference point for such an exercise.

15. In conclusion, Madame Chair, we welcome once again the work of the Commission on these issues and look forward to receiving its future deliberations on them, as well as on the other topics that are on its agenda.

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