MIL5902
Assignment 2 2026
Unique number:
Due date: September 2026
1. QUESTION 1: LEGAL REASONING AND TRANSNATIONAL LEGAL
ORDERS IN INTERNATIONAL TRADE LAW
1.1 Introduction
International trade law is often described as a system created by states, yet its daily
operation depends on more than treaties and domestic legislation.1 Commercial
parties, arbitral tribunals and international institutions also influence the rules that
guide cross border transactions, which makes legal reasoning more plural than
ordinary national law.1 I think the better view is that international trade law does not
abandon state authority, but combines state consent with transnational methods that
help legal rules work across different legal systems.1
1.2 Legal reasoning in international trade law
,1. QUESTION 1: LEGAL REASONING AND TRANSNATIONAL LEGAL ORDERS
IN INTERNATIONAL TRADE LAW
1.1 Introduction
International trade law is often described as a system created by states, yet its daily
operation depends on more than treaties and domestic legislation.1 Commercial
parties, arbitral tribunals and international institutions also influence the rules that
guide cross border transactions, which makes legal reasoning more plural than
ordinary national law.2 I think the better view is that international trade law does not
abandon state authority, but combines state consent with transnational methods that
help legal rules work across different legal systems.3
1.2 Legal reasoning in international trade law
Legal reasoning in international trade law begins with the wording of treaties,
although interpretation becomes necessary when broad treaty language must be
applied to complicated commercial facts.4 The Dispute Settlement Understanding
requires World Trade Organization bodies to clarify covered agreements in
accordance with customary rules of public international law, which directs
interpreters towards the Vienna Convention rather than personal preference.5
Articles 31 and 32 of the Vienna Convention therefore support a method based on
ordinary meaning, context, object and purpose, together with limited supplementary
material when the normal process leaves uncertainty.6 This method is important
because it gives adjudicators enough flexibility to resolve disputes while still keeping
their reasoning tied to legal sources accepted by states.7
1
Rambod Behboodi, ‘Legal Reasoning and the International Law of Trade: The First Steps of the
Appellate Body of the WTO’ (1998) 32(4) Journal of World Trade 55, 55–59.
2
Behboodi (n 1) 63–67.
3
JH Dalhuisen, ‘Legal Orders and Their Manifestation: The Operation of the International Commercial
and Financial Legal Order and Its Lex Mercatoria’ (2006) 24 Berkeley Journal of International Law
129, 129–135.
4
Understanding on Rules and Procedures Governing the Settlement of Disputes, Marrakesh
Agreement Establishing the World Trade Organization, Annex 2, art 3.2.
5
Vienna Convention on the Law of Treaties (adopted 23 May 1969, entered into force 27 January
1980) 1155 UNTS 331, arts 31–32.
6
Behboodi (n 1) 72–80.
7
Appellate Body Report, United States – Standards for Reformulated and Conventional Gasoline,
WT/DS2/AB/R, adopted 20 May 1996, 17.
, In United States – Gasoline, the Appellate Body treated the Vienna Convention rules
as the proper starting point for interpreting World Trade Organization agreements,
which strengthened consistency between trade law and general international law. 8 In
Japan – Alcoholic Beverages II, the Appellate Body also explained that adopted
reports create legitimate expectations even though they do not operate as binding
precedent in the same manner as judgments in many domestic systems. 9 These
decisions show that international trade reasoning develops through repeated
interpretation, because later panels normally consider earlier reasoning when similar
wording or legal problems arise.10 In my view, that practice creates useful stability
without pretending that an international court has legislative power to rewrite the
treaty bargain.
1.3 Emergence of transnational legal orders
The emergence of transnational legal orders is most visible in international
commercial law, where business relationships often cross several states and cannot
be managed comfortably through one national legal system alone.11 Parties may
choose arbitration, standard contract terms, trade usages and internationally
recognised principles because these tools reduce uncertainty when commercial
actors come from different legal traditions.12 The United Nations Convention on
Contracts for the International Sale of Goods supports this approach by requiring
regard to its international character and by recognising usages agreed by parties or
regularly observed in their trade.13 The UNIDROIT Principles perform a similar
function by offering neutral rules that parties and tribunals may use when interpreting
or supplementing international commercial arrangements.14
International arbitration gives practical force to this transnational legal order because
parties can select a neutral tribunal and avoid having every dispute controlled by the
8
Understanding on Rules and Procedures Governing the Settlement of Disputes (n 4) art 3.2.
9
Appellate Body Report, Japan – Taxes on Alcoholic Beverages, WT/DS8/AB/R, WT/DS10/AB/R and
WT/DS11/AB/R, adopted 1 November 1996, 14–15.
10
Behboodi (n 1) 83–90.
11
Dalhuisen (n 3) 136–144.
12
Dalhuisen (n 3) 145–153.
13
United Nations Convention on Contracts for the International Sale of Goods (adopted 11 April 1980,
entered into force 1 January 1988) 1489 UNTS 3, arts 7(1) and 9.
14
UNIDROIT, Principles of International Commercial Contracts 2016, Preamble and arts 1.9 and 4.1.
Assignment 2 2026
Unique number:
Due date: September 2026
1. QUESTION 1: LEGAL REASONING AND TRANSNATIONAL LEGAL
ORDERS IN INTERNATIONAL TRADE LAW
1.1 Introduction
International trade law is often described as a system created by states, yet its daily
operation depends on more than treaties and domestic legislation.1 Commercial
parties, arbitral tribunals and international institutions also influence the rules that
guide cross border transactions, which makes legal reasoning more plural than
ordinary national law.1 I think the better view is that international trade law does not
abandon state authority, but combines state consent with transnational methods that
help legal rules work across different legal systems.1
1.2 Legal reasoning in international trade law
,1. QUESTION 1: LEGAL REASONING AND TRANSNATIONAL LEGAL ORDERS
IN INTERNATIONAL TRADE LAW
1.1 Introduction
International trade law is often described as a system created by states, yet its daily
operation depends on more than treaties and domestic legislation.1 Commercial
parties, arbitral tribunals and international institutions also influence the rules that
guide cross border transactions, which makes legal reasoning more plural than
ordinary national law.2 I think the better view is that international trade law does not
abandon state authority, but combines state consent with transnational methods that
help legal rules work across different legal systems.3
1.2 Legal reasoning in international trade law
Legal reasoning in international trade law begins with the wording of treaties,
although interpretation becomes necessary when broad treaty language must be
applied to complicated commercial facts.4 The Dispute Settlement Understanding
requires World Trade Organization bodies to clarify covered agreements in
accordance with customary rules of public international law, which directs
interpreters towards the Vienna Convention rather than personal preference.5
Articles 31 and 32 of the Vienna Convention therefore support a method based on
ordinary meaning, context, object and purpose, together with limited supplementary
material when the normal process leaves uncertainty.6 This method is important
because it gives adjudicators enough flexibility to resolve disputes while still keeping
their reasoning tied to legal sources accepted by states.7
1
Rambod Behboodi, ‘Legal Reasoning and the International Law of Trade: The First Steps of the
Appellate Body of the WTO’ (1998) 32(4) Journal of World Trade 55, 55–59.
2
Behboodi (n 1) 63–67.
3
JH Dalhuisen, ‘Legal Orders and Their Manifestation: The Operation of the International Commercial
and Financial Legal Order and Its Lex Mercatoria’ (2006) 24 Berkeley Journal of International Law
129, 129–135.
4
Understanding on Rules and Procedures Governing the Settlement of Disputes, Marrakesh
Agreement Establishing the World Trade Organization, Annex 2, art 3.2.
5
Vienna Convention on the Law of Treaties (adopted 23 May 1969, entered into force 27 January
1980) 1155 UNTS 331, arts 31–32.
6
Behboodi (n 1) 72–80.
7
Appellate Body Report, United States – Standards for Reformulated and Conventional Gasoline,
WT/DS2/AB/R, adopted 20 May 1996, 17.
, In United States – Gasoline, the Appellate Body treated the Vienna Convention rules
as the proper starting point for interpreting World Trade Organization agreements,
which strengthened consistency between trade law and general international law. 8 In
Japan – Alcoholic Beverages II, the Appellate Body also explained that adopted
reports create legitimate expectations even though they do not operate as binding
precedent in the same manner as judgments in many domestic systems. 9 These
decisions show that international trade reasoning develops through repeated
interpretation, because later panels normally consider earlier reasoning when similar
wording or legal problems arise.10 In my view, that practice creates useful stability
without pretending that an international court has legislative power to rewrite the
treaty bargain.
1.3 Emergence of transnational legal orders
The emergence of transnational legal orders is most visible in international
commercial law, where business relationships often cross several states and cannot
be managed comfortably through one national legal system alone.11 Parties may
choose arbitration, standard contract terms, trade usages and internationally
recognised principles because these tools reduce uncertainty when commercial
actors come from different legal traditions.12 The United Nations Convention on
Contracts for the International Sale of Goods supports this approach by requiring
regard to its international character and by recognising usages agreed by parties or
regularly observed in their trade.13 The UNIDROIT Principles perform a similar
function by offering neutral rules that parties and tribunals may use when interpreting
or supplementing international commercial arrangements.14
International arbitration gives practical force to this transnational legal order because
parties can select a neutral tribunal and avoid having every dispute controlled by the
8
Understanding on Rules and Procedures Governing the Settlement of Disputes (n 4) art 3.2.
9
Appellate Body Report, Japan – Taxes on Alcoholic Beverages, WT/DS8/AB/R, WT/DS10/AB/R and
WT/DS11/AB/R, adopted 1 November 1996, 14–15.
10
Behboodi (n 1) 83–90.
11
Dalhuisen (n 3) 136–144.
12
Dalhuisen (n 3) 145–153.
13
United Nations Convention on Contracts for the International Sale of Goods (adopted 11 April 1980,
entered into force 1 January 1988) 1489 UNTS 3, arts 7(1) and 9.
14
UNIDROIT, Principles of International Commercial Contracts 2016, Preamble and arts 1.9 and 4.1.
