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Economic Sanctions Under International Law

Under International Law, States and Non-State entities often use economic sanctions as a tool of foreign policy or sometimes, economic warfare. Such economic sanctions are not only targeted towards States as in recent cases such as Iran and Syria but also Non-State entities like anti-terrorist lists, companies connected with the military junta in Myanmar, etc. The act of imposing economic sanctions is both criticized as well as support. Critiques contend that economic sanctions are often poorly conceived by the targeted entity and do not produce the desired results. Whereas, the supporters claim that in recent years the imposition of economic sanctions has been an effective tool in the maintenance of international decorum.


Economic sanctions are one of the measures taken by State and Non-State entities to maintain international peace and security without the use of armed forces. It may be defined as the withdrawal of customary trade and financial relations with a State, organization, or individual in the light of foreign policy and international norms. It may be imposed by the United Nations, wherein under Chapter VII of the UN Charter, the United Nations Security Council can take measures to enforce international peace and security with the use of economic sanctions as given under Article 39 and Article 41 of the UN Charter.

Economic sanctions may also be imposed by regional governmental organizations such as the European Union or by States acting unilaterally. One such example of unilateral sanctions is the comprehensive trade sanction imposed by the United States on the government of Nicaragua on May 1, 1985. Pursuant to the sanction, President Reagan placed a total embargo on all trade with Nicaragua and suspended service to the United States by Nicaraguan airlines and flag vessels. The termination of all economic interactions by the United States with the government of Nicaragua reflects the general deterioration of relations between the US and Nicaragua government.

ECONOMIC SANCTIONS UNDER INTERNATIONAL LAW

The decentralized structure of International law does not provide any executive body to enforce the rule of conduct nor does it provide a judicial body that can exercise a compulsory jurisdiction over the States. In the absence of such authority, the common interest of the States emerges as the primary reason for the adherence to international rules and customs. Such common interest lies in the maintenance of orderly economic transactions. However, the fact that adherence to these international rules of economic transactions is in the best interest of all the nations does not imply that all States comply with these rules. Such non-compliance may result in a breach of a duty or an agreement. In addition to this, it may also result in a violation of general international law or customs. In such cases, economic sanctions come into the picture.

LEGALITY OF ECONOMIC SANCTIONS AS ‘USE OF FORCE’

Under Article 2(4) of the United Nations Charter, the use of force is prohibited. However, there is no explicit prohibition on coercive economic sanctions under International Law.

Compliance with the rules of international law is in the common interest of all the States on the international platform. However, the rules of international law do not bind all States at all times. The rules of international law evolved through the common consent of all the states, but a proposed rule of international law does not bind a nation that has not consented to the rule, either expressly or impliedly. A State may either expressly manifest its consent to a rule through a treaty or a declaration or it may act in such a manner as to imply its consent to a rule of international conduct.

The principle of sovereignty gives effect to the State’s ability to independently determine and formulate policies of trade and economics, which should be free from the interference of other nations. Foreign trade, however, by its own nature effects other nations of the international community. One of the natural consequences of international sovereignty is that international legal obligations are binding upon the participant States. The foreign policy of the state, therefore, is subject to the scrutiny of international law.

IMPACT OF ECONOMIC SANCTIONS ON TARGET STATES

The main objective of economic sanctions is to induce the target State or the Non-State entity to comply with the rules of international law by taking particular actions or to discontinue them in order to eliminate threats to or breach of peace, or acts of aggression. The prospects of such sanctions depend on the extent to which the target authorities are dependent on the nation imposing such sanctions.

Generally, economic sanctions are imposed to exert pressure on the economy of the target state in the hope that the rational considerations will cause the government to take measures in consonance with the rule of international law so as to relieve some pressure on its economy. Unfortunately, this is not always the result wherein the general population of the nation is severely affected, without being able to induce its government to change its course.

Because the imposition of economic sanctions can be proven to be non-effective and because they can inflict undue pressure and pain on the general population and the neighbouring states, other sanctions have been coming into use. This includes the imposition of cultural sanctions, wherein in particular athletes of the target country are excluded from international sports competitions.

ABOUT THE AUTHOR

Arushi Gupta is a 5th-year BA LLB student at DES Law College, Pune University.

They can be contacted at arushigupta1005@gmail.com

LinkedIn ID: linkedin.com/in/arushi-gupta-534630192/

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