Soft International Economic Law: A New Sovereign?

Abstract

This article examines the influence of soft law on formal international economic law structures and develops a theoretical framework for understanding its systemic significance within the discipline. The study addresses two intersecting objectives: first, demonstrating that soft laws substantially impact commercial treaties, global financial regulation policies, investment agreements, and dispute settlement institutions; second, establishing that despite this broad influence, international economic law lacks a cohesive theoretical understanding of soft law’s systemic weight. The research employs comparative, normative, and analytical methodologies to examine how soft law functions as a contemporary mechanism through which seemingly benign taxonomies exert substantial influence in international economic law. The analysis reveals that soft law operates as a functional alternative when states and international law-makers cannot achieve consensus on treaties or hard law instruments. This study contributes to international economic law scholarship by providing a systematic theoretical framework for understanding soft law’s role and demonstrating its significant impact on formal legal structures and regulatory processes.