General List No. 78

Judgment No. 30

4 April 1939

 

PERMANENT COURT OF INTERNATIONAL JUSTICE

Judicial Year 1939

 

The Electricity Company of Sofia and Bulgaria (Preliminary Objection)

 

Belgium v. Bulgaria

Judgment

 
BEFORE: President: Guerrero
Vice-President: Sir Cecil Hurst
Judges: Count Rostworowski, Fromageot, ALtamira, Anzilotti, Urrutia, Jhr. van Eysinga, Nagaoka, Cheng, Hudson,  De Visscher, Erich,
Judge(s) ad hoc: Papazoff
     
Represented By: Belgium: M. J. G. de Ruelle, as Agent
Bulgaria: M. Ivan Altinoff, as Agent
    
Perm. Link: http://www.worldcourts.com/pcij/eng/decisions/1939.04.04_electricity1.htm
  
Citation: Electricity Company of Sofia and Bulgaria (Belg. v. Bulg.), 1939 P.C.I.J. (ser. A/B) No. 77 (Apr. 4)
Publication: Publications of the Permanent Court of International Justice, Series A./B. No. 77; Collection of Judgments, Orders and Advisory Opinions A.W. Sijthoff’s Publishing Company, Leyden, 1939.
  
 

  

[Translation]

[p65] The Court,
composed as above,
delivers the following judgment:

[1] By an Application filed with the Registry of the Court on January 26th, 1938, under Article 40 of the Statute of the Court, the Belgian Government instituted proceedings before the Court against the Bulgarian Government.

[2] In submitting the case to the Court the Applicant relied upon:

(1) the declarations of Belgium and Bulgaria recognizing the jurisdiction of the Court as compulsory, declarations which were respectively ratified on March 10th, 1926, and August 12th, 1921;
(2) the Treaty of conciliation, arbitration and judicial settlement concluded between the two countries on June 23rd, 1931.

[3] After a succinct statement of the facts and arguments adduced in support of. the claim, the Application prayed the Court:

"(A) to declare that the State of Bulgaria has failed in its international obligations:

(1) by reason of the fact that the State Administration of Mines, on November 24th, 1934, put into force a special artificially calculated tariff for coal supplied to power stations, in order to enable the Municipality of Sofia to distort the application of the decisions given by the Mixed Arbitral Tribunal in 1923 and 1925;
(2) by reason of the above-mentioned judgments of the District Court and of the Court of Appeal of Sofia, which deprived the Electricity Company of Sofia and Bulgaria of the benefit of the said decisions of the Mixed Arbitral Tribunal

(a) by allowing the fictitious value fixed by the Administration of Mines to be used for the calculation of the factor 'P' in the formula for determining the tariff, [p66]
(b) by deciding that the factor V should be calculated on the basis of the official rate of exchange decreed by the National Bank of Bulgaria and not on the basis of the rate of exchange actually applied by that Bank for the conversion of Bulgarian currency into foreign currency,
(c) by deciding that the Company could no longer require its consumers to pay the amount of the excise duty,
(d) by deciding that the Company could not put any tariff into operation before having obtained the formal agreement of the Municipality;

(3) by reason of the promulgation of the law of February 3rd, 1936, Article 30, paragraph C, of which establishes a special tax on the distribution of electric power purchased from undertakings not subject to tax.

(B) and to order the requisite reparation in respect of the above-mentioned acts to be made. "

[4] On January 26th, 1938, notice of the Application of the Belgian Government was given to the Bulgarian Government, and on February 1st the communications provided for in Article 40 of the Statute and Article 34 of the Rules of Court were duly despatched.

[5] As the Court does not include upon the Bench a judge of Bulgarian nationality, the Bulgarian Government availed itself of its right under Article 31 of the Statute and nominated M. Theohar Papazoff.

[6] The two Governments appointed as their Agents: the Belgian Government, M. J. G. de Ruelle, assisted by Maitre Rene Marcq and Maitre Henri Rolin, and the Bulgarian Government, M. Ivan Altinoff, assisted by Maitre Gilbert Gidel.

[7] By an Order made on March 28th, 1938, the President of the Court fixed the time-limits for the filing of the Memorial by the Belgian Government and of the Counter-Memorial by the Bulgarian Government.

[8] On July 2nd, 1938, the Belgian Government, in view of certain measures of execution against the Electricity Company of Sofia and Bulgaria, announced by the Municipality of Sofia in default of payment by that Company of a certain sum claimed from it, requested the Court, under Article 41 of the Statute and Article 61 of the Rules, to indicate, as an interim measure of protection, that the compulsory collection by the Municipality of Sofia of the said sum must be postponed pending the delivery of judgment on the merits.

[9] The Court held a hearing on July 13th, 1938, for the examination of this request, but a communication was received from the Agent for the Bulgarian Government stating that he could not be present at the hearing as the notice given was very short. The Court however heard a statement by the Agent for [p67] the Belgian Government to the effect that his Government would make no objection to the granting of the necessary time to the Bulgarian Government. After deliberation, the Court decided the same day to adjourn the proceedings in regard to the request for the indication of interim measures of protection, in order to enable the Bulgarian Government to prepare its observations upon that request and, if need be, in regard to the jurisdiction of the Court; the Agents of the Parties would be heard by the Court at a public sitting the date of which would be subsequently fixed by the President.

[10] Following upon a telegram sent on July 27th, 1938, by the Agent for the Bulgarian Government to the President of the Court, the text of which was duly communicated to the Agent for the Belgian Government, the latter informed the Court in a letter of August 26th, 1938, that in view of the statements contained in this telegram, the Belgian Government withdrew the request for the indication of an interim measure of protection presented on July 2nd, 1938.

[11] On August 27th, 1938, the President of the Court made an Order recording the withdrawal by the Belgian Government of its request for the indication of an interim measure of protection and stating that in these circumstances there was no occasion to fix the public hearing contemplated by the Court's decision of July 13th, 1938.

[12] By another Order of the same date, the President extended until October 31st, 1938, the time-limit for the filing of the Bulgarian Counter-Memorial which had originally been fixed to expire on September 12th, 1938. This time-limit, which was subsequently further extended, finally expired on November 30th, 1938.

[13] In its Memorial, the Belgian Government prayed the Court:

"A. - To declare that the State of Bulgaria has failed in its international obligations:

(1) By reason of the fact that the State Administration of Mines, on November 24th, 1934, put into force a special artificially calculated tariff for coal supplied to power stations, in order to enable the Municipality of Sofia to distort the application of the decisions given by the Mixed Arbitral Tribunal in 1923 and 1925;
(2) By reason of the above-mentioned judgments of the District Court and of the Court of Appeal of Sofia and of the judgment of the Court of Cassation of March 16th, 1938, which deprived the Electricity Company of Sofia and Bulgaria of the benefit of the said decisions of the Mixed Arbitral Tribunal;

(a) By allowing the fictitious value fixed by the Administration of Mines to be used for the calculation of the factor 'P' in the formula for determining the tariff; [p68]
(b) By deciding that the factor V should be calculated on the basis of the official rate of exchange decreed by the National Bank of Bulgaria and not on the basis of the rate of exchange actually applied by that Bank for the conversion of Bulgarian currency into foreign currency;
(c) By deciding that the Company could no longer require its consumers to pay the amount of the excise duty;
(d) By deciding that the Company could not put any tariff into operation before having obtained the formal agreement of the Municipality;

(3) By reason of the promulgation of the law of February 3rd, 1936, as supplemented by Circular No. 3800 of February 28th, 1936, and the law of April 2nd, 1936, instituting a special tax on the distribution of electric power purchased from undertakings not subject to tax.

B. - To order the respondent Party to take all administrative, legislative or other measures necessary:

1. To reinstate the Electricity Company of Sofia and Bulgaria in its rights as against both the State of Bulgaria and the Municipality, also as against any public or private consumer of current;
2. To ensure repayment to the Electricity Company of Sofia and Bulgaria of all undue payments made by it as a result of the measures complained of and compensation for any sums due which it has been prevented from collecting as a result of these measures.

C. - To authorize the Belgian Government to specify the damage sustained by the Electricity Company of Sofia and Bulgaria as a result of the facts set out above. "

[14] On November 25th, 1938, that is to say before the expiration of the time-limit finally fixed for the filing of the Counter-Memorial, the Agent for the Bulgarian Government filed a document entitled "Memorial of the Bulgarian Government" in which, as the conclusion of a preliminary objection to the jurisdiction, he prayed the Court:

"To declare that it has no jurisdiction to entertain the Appli cation filed by the Belgian Government on January 26th, 1938.
To dismiss all the claims, pleas and submissions of the Belgian Government. "

[15] The proceedings on the merits having, under Article 62, paragraph 3, of the Rules of Court, been suspended by the filing of the objection, the President of the Court, on November 30th, 1938, made an Order fixing January 25th, 1939, as the date of expiration of the time allowed to the Belgian Government for the presentation of a written statement of its [p69] observations and submissions in regard to the objection raised by the Bulgarian Government.

[16] The Belgian Government's written statement, entitled "Additional Memorial", was duly filed on January 25th, 1939, and accordingly on that date the case became ready for hearing in regard to the objection of the Bulgarian Government.

[17] In this written statement, the Belgian Government prayed the Court:

"To declare that it has jurisdiction,
To order the respondent Party to plead on the merits and to fix the time-limits for the further written proceedings. "

[18] In the course of public sittings held on February 27th and 28th, and March 1st, 1939, the Court heard:

M. Ivan Altinoff, Agent, and Maitre Gilbert Gidel on behalf of Bulgaria; and M. J. G. de Ruelle, Agent, and Maitre Henri Rolin on behalf of Belgium.

[19] The submissions made in the written proceedings were not amended on either side in the course of the oral proceedings.

[20] Documents in support of their contentions were filed on behalf of either Party [FN1].

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[FN1] See list in annex.
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[21] The above being the state of the proceedings, the Court must now adjudicate.

***

[22] The facts are as follows:

[23] A concession for the distribution of electric current for light and power was granted by the Municipality of Sofia in 1898 to a French company, the Société des Grands Travaux de Marseille. In 1909 the said French company transferred its rights to the "Electricity Company of Sofia and Bulgaria", a company founded in Brussels on September 8th, 1908, by a notarial act published in the Moniteur belge on September 23rd, 1908. The transfer was approved by the Municipality of Sofia with some modifications of the original contract, the concession being due to expire on December 31st, 1940. The rights and obligations of exploitation are set out in the contract of concession of 1898, the specification annexed thereto, and the contract of transfer of 1909.

[24] During the War of 1914-1918, which found Belgium and Bulgaria on opposite sides, the works of the Belgian Company were taken over by the Municipality of Sofia on [p70] September 1st, 1916. After the conclusion of peace, the Belgian Company, under Article 182 of the Treaty of Neuilly of November 27th, 1919, was given the right to restitution of its property with an indemnity to be assessed by a Mixed Arbitral Tribunal, which was also entrusted with the task of adapting the concession contract to the new economic conditions in case of disagreement between the parties. Consequently, a suit was instituted by the Company before the Belgo-Bulgarian Mixed Arbitral Tribunal against the State of Bulgaria and against the Municipality of Sofia.

[25] On July 5th, 1923, the Belgo-Bulgarian Mixed Arbitral Tribunal gave a first judgment decreeing inter alia the restitution of the Belgian Company's property and the restoration of its position as existing before the war, subject to modifications to be decided by the Mixed Arbitral Tribunal in application of Article 182 of the Treaty of Neuilly. Accordingly, the Mixed Arbitral Tribunal nominated a commission of experts for the purpose of fixing a flexible tariff - which should take into account the new economic conditions and future variations of different elements relevant to the fixing of the sale-price of electric current - such as salaries, the rate of the lev and its purchasing power - and also for the purpose of assessing the amount of the indemnity. The expert's deposited their report on March 3rd, 1924, with the Mixed Arbitral Tribunal, which on May 27th, 1925, delivered its final judgment (a clerical error in which was corrected by a judgment rendered on October 30th, 1925). This judgment, in brief: (1) dismissed the applicant's claims against the State of Bulgaria; (2) ordered the immediate restitution of the Company's property, the payment of a sum of 9, 000, 000 Belgian francs by the Municipality of Sofia to the Company, the prolongation of the concession to December 31st, i960, and the acceptance of the formula arrived at by the experts for fixing the selling price.

[26] The application of the formula, which is composed of different factors, such as "P" (price of coal), "t" (cost of transport), "T" (rate of exchange), "S" (salaries), "x" (taxation), appears to have encountered no serious difficulties until the last quarter of 1934, when a controversy arose in regard to the value to be assigned to the factor "P"..

[27] On October 6th, 1934, the Electricity Company communicated to the Municipality as usual the data for the determination of the tariff for the fourth quarter of 1934. The value attributed to the term "P" therein was 330 leva. The Municipality requested that the documents in support of the figures should be furnished.

[28] On October 24th, 1934, the State Mines Administration delivered to the Electricity Company a certificate indicating [p71] that the price of second quality coal was 360 leva per ton for the "first zone". This certificate was forwarded by the Electricity Company on November 15th, 1934, to the Municipality, which informed the Company on November 20th that it could not accept the certificate supplied by the Mines Administration on October 24th, 1934, because it related to second quality coal at that particular time and not to second quality coal unsorted (tout-venant) as produced in 1925 and as referred to in the judgment of the Mixed Arbitral Tribunal.

[29] On November 26th, 1934, the Company received from the State Mines Administration a notice stating that, by a decision of November 24th of the Board of Directors, the prices of coal destined for the production of electric current were fixed at a certain figure. The Electricity Company protested against this figure, but finally an agreement, with certain reservations, was reached fixing the tariff for the year 1935 at a certain rate per kilowatt-hour of current distributed.

[30] After the devaluation of the Belgian franc on April 1st, 1935, the Electricity Company, by a letter addressed to the Municipality on October 29th of that year, observed that the introduction of the new rate of exchange in the calculation of the tariff according to the formula of the Mixed Arbitral Tribunal led to results very near to those agreed on for the year 1935 and announced its decision to adhere strictly, for the year 1936, to the judgments of the Mixed Arbitral Tribunal, pointing out that the term "P" should be understood as applying to the second quality of coal appearing in the price list at the time when the formula was established.

[31] On December 13th, 1935, the Municipality replied by letter that the formula contained elements that were inapplicable and led to absurd results, in that it did not take into consideration the real state of affairs and the economic condition prevailing in Sofia. No agreement was reached on this issue and, by letter dated January 31st, 1936, the Municipality expressed its intention no longer to authorize the Company to recover from consumers the amount of the excise duty.

[32] A new exchange of letters between the Company and the Municipality also led to no result.

[33] By a note verbale dated January 28th, 1936, the Belgian Legation at Sofia proposed to the Bulgarian Minister of Foreign Affairs the joint submission by the Municipality and the Company to the Mixed Arbitral Tribunal of the divergences of interpretation to which the factor "P" (price of coal) in the formula had given rise. To this the Bulgarian Ministry for Foreign Affairs, by [p72] a note verbale dated February 18th, 1936, replied that the Municipality and the Ministry of Agriculture could not accept this proposal. The note verbale added that the Mixed Arbitral Tribunal no longer existed and could not be revived, and that the Municipality had therefore seen fit to have recourse to the only tribunal competent to adjudicate in the matter, namely the Regional Court of Sofia.

[34] The Company having seized the Mixed Arbitral Tribunal the Council of the League of Nations, in application of provisions in the Treaty of Neuilly, appointed a substitute in the place of the Bulgarian arbitrator on the Mixed Arbitral Tribunal. Tha Tribunal rendered a judgment on December 29th, 1936, declaring the claim of the Company inadmissible, either as a request concerning the interpretation of the original award, because the time-limit for this had expired, or as a request for execution, because the latter was a question exclusively for the two Governments.

[35] Meanwhile, as had already been stated, the Municipality had instituted a suit against the Company before the Regional Court of Sofia for the determination of the rights and obligations in respect of the sale price of electric current. In this suit the Municipality also claimed that the Company had no right to collect either from the subscribers or from the Municipality the price of the current consumed calculated according to the formula of the arbitral judgment until the price in question had been approved by the Municipality, according to Article 21 of the contract specification. It further asked for the appointment of experts to establish the real value of the factors "P" (price of coal) and "x" (taxation) and, thereby, the legal sale price per kilowatt-hour.

[36] In its defence the Company contested both the jurisdiction of the Regional Court and the admissibility of the suit; alternatively, on the merits, it requested that, in case the Court should order an expert enquiry as to the terms "P" (price of coal) and "x" (taxation), it should have the terms "S" (salaries) and "r" (exchange) likewise examined.

[37] The Regional Court, in its decision of October 24th, 1936, on the merits, found in favour of the Municipality as regards the interpretation of the terms "P" (price of coal) and "r" (exchange) and, to a certain extent, in favour of the Company as regards the interpretation of the term "x" (taxation).

[38] Both parties appealed to the Sofia Court of Appeal which by its judgment of March 27th, 1937, confirmed that part of the judgment of the Regional Court which was in favour of the Municipality and reversed that part which. was in favour of the Company. An appeal against this judgment was made by the Company on June 23rd, 1937, to the Court of Cassation. [p73]

[39] In the meantime a new income tax law dated January 24th, 1936, was promulgated on February 3rd of the same year by the Bulgarian Government. Article 30 of this law created a different rate of taxation as between electricity companies producing electric current themselves and those purchasing it from undertakings not subject to taxation; the Article was subsequently defined, in respect of Municipalities, by a circular published in the Official Journal of March 4th, 1936, and modified, in respect of State mines and hydraulic syndicates, by a law dated April 2nd, 1936, published in the Official Journal of April 16th, 1936.

[40] On May 18th, 1936, the Company wrote to the Bulgarian Minister of Finance, saying that there was an error in the estimation of the tax referred to in Article 30 (b) of the Income Tax Law dated January 24th, 1936, and promulgated on February 3rd of the same year, and requested him to verify the accuracy of the figures submitted by it and to make the corresponding corrections in the said Article.

[41] On April 22nd, 1937, the Belgian Minister at Sofia, in a letter to the Bulgarian President of the Council and Minister for Foreign Affairs and Public Worship, complained of the attitude of the Mayor of Sofia in invoking the judgment of the Court of Appeal, against which the Company had decided to appeal to the Court of Cassation, adding that "the Electricity Company has never ceased to declare that it will comply with any judgment by the Bulgarian courts which, after the exhaustion of all the remedies provided for in the proceedings, shall have acquired the effect of a final judgment", and that "the recent judgment of the Court of Appeal has no executory force, because the action brought against the Electricity Company by the Mayor was for the purpose of determining facts (constatatoire) and not for the purpose of securing a conviction (condamnatoire)".

[42] On June 24th, 1937, the Belgian Minister at Sofia, in a letter to the Bulgarian President of the Council and Minister for Foreign Affairs and Public Worship, referred to the dispute between the Municipality and the Company as one resulting from the intervention of "certain administrative and judicial authorities of the Bulgarian State". The Belgian Minister expressed the view that the decision of the Court of Appeal of Sofia on March 27th, 1937, had disregarded the rights of the Company as defined by the Belgo-Bulgarian Mixed Arbitral Tribunal in its judgments of July 5th, 1923, and May 27th, 1925. In these circumstances the Minister intimated that the dispute in question was one which, according to Articles 4 and 6 of the Treaty of conciliation, arbitration and judicial settlement entered into between Bulgaria and Belgium on June 23rd, 1931, might be unilaterally submitted to the Permanent Court of International Justice "(à la clause de compétence obligatoire de laquelle la Bulgarie, a, d'autre part, adhere [p74] le 21 août 1921)", unless an agreement was reached to submit it to arbitration. He therefore proposed to the Bulgarian Government that the case should be referred to the Permanent Court of International Justice by means of a special agreement and added that, if no agreement on the terms of this special agreement could be reached in two months, the Belgian Government, availing itself of its rights, would bring the case before the Permanent Court of International Justice unilaterally by application.

[43] In a letter of July 30th, 1937, addressed to the President of the Council and Minister for Foreign Affairs and Public Worship, the Belgian Minister in Sofia repeated and confirmed this declaration.

[44] On August 3rd, 1937, the Bulgarian President of the Council arid Minister for Foreign Affairs and Public Worship replied by letter to the Belgian Minister at Sofia that, as in his opinion the disputes between the Municipality and the Company "depend on the exclusive competence of the Bulgarian tribunals which have already had occasion to render their decision to this effect", the Bulgarian Government. could not agree to a proposition of compromise tending to bring this dispute before another jurisdiction, and that, "in so far as the communication that, in default of a compromise, the Belgian Government, basing itself on Articles 4 and 6 of the Treaty of conciliation, arbitration and judicial settlement between Bulgaria and Belgium, would lay the case unilaterally before the Permanent Court of International Justice, is concerned", the Bulgarian Government, by application of Article 3 of that Treaty, claimed in this case the jurisdiction of its own tribunals and could not consent to the dispute being submitted to the various procedures provided in the Treaty. By the same letter the Bulgarian Government informed the Belgian Government that Bulgaria denounced the Treaty in accordance with the third paragraph of Article 37 of that instrument.

[45] On January 26th, 1938, the Belgian Government filed with the Registry of the Court the Application instituting the present proceedings.

[46] On March 16th, 1938, the Court of Cassation dismissed the appeal made by the Company on June 23rd, I937.

[47] These are the facts, undisputed in the present case, having regard to which the Court is now called upon to adjudicate upon the preliminary objection raised by the Bulgarian Government.

***

[48] Before considering the preliminary objection upon which the Court has to adjudicate, the attitude of the Parties with regard to the grounds on which they have based their arguments must be determined. [p75]

[49] In order to found the jurisdiction of the Court, the Belgian Government, both in its Application and in its Memorial, relies on the one hand on the Declarations of Belgium and Bulgaria accepting the compulsory jurisdiction of the Court, Declarations which were ratified on March 10th, 1926, and August 12th, 1921, respectively; and, on the other hand, on the Treaty of conciliation, arbitration and judicial settlement of June 23rd, 1931, which came into force on February 4th, 1933 [FN1].

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[FN1] League of Nations Treaty Series, Vol. 137, p. 191.
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[50] The Bulgarian Government for its part has also relied on both, of these agreements to support its preliminary objection to the jurisdiction.

[51] In these written proceedings, the Parties adopted the same method in their endeavour to establish that their respective contentions were well founded; that is to say, they examined the Belgian Application of January 1938 in the light of the conditions independently laid down by each of these two agreements. Neither the Bulgarian Government nor the Belgian Government at any time considered the possibility that either of these agreements might have imposed some restriction on the normal operation of the other during the period for which they were both in force.

[52] The same attitude was adopted by the Agents of the two Governments in the oral proceedings. Thus the Agent for the Belgian Government stated that "either of these two instruments in reality suffices by itself to support our claims, and it would be most regrettable if the conclusion were reached that the simultaneous existence of the two instruments weakens our position". It is true that one of the Counsel for the Belgian Government at one time expressed the personal opinion - which he subsequently described as a "suggestion" - that "from February 3rd, 1933, the date of the coming into force of the Treaty of 1931, until February 3rd, 1938", the legal relations between Belgium and Bulgaria had been governed by the Treaty of 1931 alone. In the afternoon however of the same hearing, the same Counsel retracted his personal opinion or suggestion and declared that "the Treaty was only to be regarded as having suspended the optional clause in so far as it modified that clause".

[53] This led the Agent for the Bulgarian Government to take up a definite position on the point. He proceeded to demonstrate by numerous arguments that "the signature of the Treaty of conciliation of 1931 between Bulgaria and Belgium, which refers in Article 4 to the disputes enumerated in Article 36 of the Court's Statute, in no way suspended the operation of the optional clause.... ". "On the contrary", he said, "far from tacitly abrogating, or at any rate suspending the operation of [p76] the optional clause for the duration of the Treaty, the two paragraphs of Article 4 simply reinforce and do not set aside the obligation resulting from the optional clause. "

[54] The Court holds that the suggestions first made by Counsel for the Belgian Government cannot be regarded as having the effect of modifying that Party's attitude in regard to this question. The Belgian Government in fact has always been in agreement with the Bulgarian Government in holding that, when the Application was filed, their declarations accepting the Court's jurisdiction as compulsory were still in force.

[55] The Court shares the view of the Parties. In its opinion, the multiplicity of agreements concluded accepting the compulsory jurisdiction is evidence that the contracting Parties intended to open up new ways of access to the Court rather than to close old ways or to allow them to cancel each other out with the ultimate result that no jurisdiction would remain.

[56] In concluding the Treaty of conciliation, arbitration and judicial settlement, the object of Belgium and Bulgaria was to institute a very complete system of mutual obligations with a view to the pacific settlement of any disputes which might arise between them. There is, however, no justification for holding that in so doing they intended to weaken the obligations which they had previously entered into with a similar purpose, and especially where such obligations were more extensive than those ensuing from the Treaty.

[57] It follows that if, in a particular case, a dispute could not be referred to the Court under the Treaty, whereas it might be submitted to it under the declarations of Belgium and Bulgaria accepting as compulsory the jurisdiction of the Court, in accordance with Article 36 of the Statute, the Treaty cannot be adduced to prevent those declarations from exercising their effects and disputes from being thus submitted to the Court.

[58] It is necessary therefore in the first place to consider whether the objections raised by the Bulgarian Government to the jurisdiction of the Court under the Treaty are well-founded or not. Should they prove well-founded, the Court will then consider the objections raised by that Government under the declarations above mentioned. Only if both these sets of objections are alike held to be well-founded will the Court decline to entertain the case.

[59] The Court will consider the bearing of the arguments of the Bulgarian Government on the final submissions of the Belgian' Government's Application under A, Nos. 1 and 2, respecting the complaints concerning the application by the Bulgarian authorities of the decisions of the Mixed Arbitral Tribunal [p77] in 1923 and 1925; it will then consider their bearings on the submission made under A, No. 3, which relates to the promulgation of the Bulgarian law of February 3rd, 1936, concerning income tax.

*
[60] The Court will first examine the Bulgarian argument concerning the application of the Treaty of 1931, which was relied on in the first place by the Belgian Government in its Memorial of August 26th, 1938.

[61] In support of its Application, the Belgian Government invokes Article 4 of the Treaty, which runs as follows:

"All disputes with regard to which the Parties are in conflict as to their respective rights shall be submitted for decision to the Permanent Court of International Justice, unless the Parties agree, in the manner hereinafter provided, to have resort to an arbitral tribunal.
It is understood that the disputes referred to above include in particular those mentioned in Article 36 of the Statute of the Permanent Court of International Justice. "

[62] The opposing argument of the Bulgarian Government consists of two contentions, as follows:

[63] In the first place, the Bulgarian Government complains of the silence of the Belgian Memorial as to the respective "rights" in regard to which the Parties are in conflict; that Government supposes that the right which is denied to Bulgaria is the right of deciding disputes that arise between the Belgian concessionaire and the Bulgarian grantor of a public service in Bulgaria, on the subject of the application of the formula determining the price of electric current. "The Bulgarian Government insists that the right of the Bulgarian authorities to exercise jurisdiction over disputes concerning the application of provisions governing the working conditions of a public service conceded in Bulgaria to a foreign concessionaire, is inherent in the sovereignty of the Bulgarian State. The Bulgarian Government protests against any claim to invoke the Treaty of pacific settlement of June 23rd, 1931, for the purpose of disputing this right."

[64] The Belgian Government explains in its Additional Memorial of January 22nd, 1939, that "the rights which the Belgian Government relies on.... are the right to the cessation of acts prejudicial to the Electricity Company of Sofia and Bulgaria, carried out by various organs of the Bulgarian State, in violation of the latter's international obligations, and the right to obtain reparation for the damage resulting for the Belgian Company"; the Belgian Government has thus raised a point of an international character in this dispute. This last point has been [p78] contested from the outset and particularly during the discussion of the question whether the Belgian complaints do or do not fall within one or other of the categories of disputes referred to in Article 36 of the Statute (also mentioned in Article 4 of the Treaty of 1931). But the argument ratione materiœ thus developed and used in support of the preliminary objection to the jurisdiction forms a part of the actual merits of the dispute. The Court cannot therefore regard this plea as possessing the character of a preliminary objection within the meaning of Article 62 of the Rules.

[65] In the second place, the Bulgarian Government raised an argument based on the non-observance of the provisions of Article 3 of the Treaty by the Belgian Government.

[66] This Article is as follows:

"1. In the case of a dispute the occasion of which, according to the municipal law of one of the High Contracting Parties, falls within the competence of its judicial or administrative authorities, the Party in question may object to the matter in dispute being submitted for settlement by the different methods laid down in the present Treaty until a decision with final effect has been pronounced within a reasonable time by the competent authority.
2. In such a case the Party which desires to resort to the procedures laid down in the present. Treaty must notify the other Party of its intention within a period of one year from the date of the under-mentioned decision. "

[67] The Bulgarian Government alleges that the Application of January 26th, 1938, was introduced before a decision with final effect - namely the judgment of the Bulgarian Court of Cassation - was rendered, and that on that ground the application was premature and irregular.

[68] As regards the application of Article 3 of the Treaty of 1931, the following considerations must be borne in mind.

[69] This Article 3 occurs in Chapter I headed "Pacific Settlement in general", amongst provisions of a general nature, applicable to all the procedures provided for in the Treaty of 1931. This fact alone serves to show the importance attached to the clause relating to the exhaustion of local remedies, which applies to all the procedures mentioned.

[70] Article 3 itself consists of two paragraphs.

[71] The hypothesis in paragraph 1 is that, according to the municipal law of one of the High Contracting Parties, the subject of the dispute is within the jurisdiction of its judicial or administrative authorities. This hypothesis is fulfilled in the present case; for the Belgian Government does not deny that the dispute between the Belgian Electricity Company and the Bulgarian authorities concerning alleged failure by the Bulgarian authorities to observe the formula drawn up by the [p79] Mixed Arbitral Tribunal is within the jurisdiction of the Bulgarian courts.

[72] The same Article authorizes the respondent Party to "object to the matter in dispute being submitted for settlement by the different methods laid down in the present Treaty". This formality was observed by the Bulgarian Government, in particular in the letter addressed to the Belgian Minister in Sofia by the President of the Council, Minister for Foreign Affairs and Public Worship, and dated Sofia August 3rd, 1937; in this letter, of which the date is several months earlier than the introduction of the Application on January 26th, 1938, is the following passage: "With reference to the communication that, failing a special agreement, the Belgian Government would make a unilateral application to the Permanent Court of International Justice, relying on Articles 4 and 6 of the Treaty of conciliation, arbitration and judicial settlement between Bulgaria and Belgium, I feel bound to draw your Government's attention to the fact that, in application of Article 3 of that Treaty, the Bulgarian Government claims that its own courts have jurisdiction in this matter, and it cannot consent to the submission of the dispute to the different procedures provided in the said Treaty. "

[73] The following words of Article 3, No. 1, indicate the limit of time imposed on the submission of an application: ".... until a decision with final effect has been pronounced within a reasonable time by the competent authority".

[74] There being no dispute as to the reasonableness of the time within which the decision was pronounced, the controversy is reduced to the following question: at the time of the application was there a decision with final effect, or had that decision with final effect not yet been pronounced?

[75] The Belgian Government claims that it has not failed to observe the provisions of Article 3, No. 1, seeing that the subsequent decision of the Court of Cassation could not have been regarded by the contracting Parties to be that referred to in Article 3, No. 1; this ultimate Court constitutes an extraordinary remedy, and in any case the appeal in cassation had been lodged and this fact might be deemed to constitute a fulfilment of the required condition.

[76] Whatever the term applied by the Sofia Court of Appeal to its judgment, the fact remains that it was not a decision with final effect within the meaning given to that expression by Article 3, No. 1. The local remedies rule contemplated by the Treaty of 1931 implies the exhaustion of all appeals, including appeals to the Court of Cassation, a decision by which alone renders the judgment final either by annulling the judgment of the Court of Appeal and sending the case back for a re-trial, or by rejecting the appeal. [p80]

[77] No. 2 of Article 3 still further emphasizes the importance of the provision in No. 1; for, according to No. 2, a Party which desires in the circumstances contemplated by No. 1 to resort to the procedures laid down in the Treaty must notify the other Party of its intention within a period of one year from the date of the decision with final effect referred to in No. 1.

[78] The Belgian Government has vainly relied upon Article 37 (4) which runs as follows:

"4. Notwithstanding denunciation by one of the High Contracting Parties, the proceedings pending at the expiration of the current period of the Treaty shall be duly completed. "

[79] This clause does not apply: it presupposes proceedings validly instituted, and this, is not the case here owing to the absence of a decision with final effect on January 26th, 1938. Moreover, the irregularity of the Belgian Application was not removed by the judgment rendered on March 16th, 1938, by the Bulgarian Court of Cassation, for in the meantime, i. e. on February 4th, 1938, the Treaty of 1931 had expired, having been denounced by the Bulgarian Government.

[80] Accordingly, since the Belgian Application has not been submitted in accordance with the conditions laid down by the Treaty of 1931, the Belgian Government cannot found the jurisdiction of the Court on that Treaty.

*

[81] The negative result arrived at by the examination of the first source of jurisdiction does not however dispense the Court from the duty of considering the other source of jurisdiction invoked separately and independently from the first.

[82] The Court will now proceed to consider the Bulgarian Government's argument relating to the declarations of adherence to the Optional Clause of the Court's Statute.

[83] With regard to their terms, the declarations of adherence of Bulgaria and Belgium differ in that the declaration of the Bulgarian Government runs as follows:

"On behalf of the Government of the Kingdom of Bulgaria I recognize, in relation to any other Member or State which accepts the same obligation, the jurisdiction of the Court as compulsory ipso facto and without any special convention, unconditionally",

and contains no reservation apart from the condition of reciprocity, whereas the declaration of the Belgian Government runs as follows: [p81]

"On behalf of the Belgian Government, I recognize as compulsory, ipso facto and without special agreement, in relation to any other Member or State accepting the same obligations, the jurisdiction of the Court in conformity with Article 36, paragraph 2, of the Statute of the Court for a period of fifteen years, in any disputes arising after the ratification of the present declaration with regard to situations or facts subsequent to this ratification, except in cases where the Parties have agreed or shall agree to have recourse to another method of pacific settlement. "

[84] The Bulgarian Government relies on the limitation ratione temporis embodied in the Belgian declaration concerning the situations or facts with regard to which the dispute has arisen, in order to dispute the jurisdiction of the Court. Although this limitation does not appear in the Bulgarian Government's own declaration, it is common ground that, in consequence of the condition of reciprocity laid down in paragraph 2 of Article 36 of the Court's Statute and repeated in the Bulgarian declaration, it is applicable as between the Parties.

[85] The Parties agree that the date on which the dispute arose was June 24th, 1937, i. e., after March 10th, 1926 - the date of the establishment of the juridical bond between the two States under Article 36 of the Court's Statute.

[86] On the other hand, the Bulgarian Government in its argument raises the following point: Although the facts complained of by the Belgian Government in the submissions of its Application under A, Nos. 1 and 2, all date from a period subsequent to March 10th, 1926, the situation with regard to which the dispute arose dates back to a period before that date. This situation was created by the awards of the Belgo-Bulgarian Mixed Arbitral Tribunal and in particular by the formula established by the awards of July 5th, 1923, and May 27th, 1925, for the fixing of the price per kilowatt-hour of power distributed. The complaints made by the Belgian Government concerning the application of this formula by the Bulgarian authorities relate, it is contended, to the working of that formula and make it the centre point of the dispute. It has also been argued that since the situation resulting from that formula dates from before the material date, namely, March 10th, 1926, the Bulgarian Government is justified in holding that the dispute which has arisen in regard to it falls outside the Court's jurisdiction by reason of the limitation ratione temporis contained in the Belgian declaration.

[87] The Court cannot accept this view. It is true that it may be said that the awards of the Mixed Arbitral Tribunal established between the Belgian Electricity Company and the Bulgarian authorities a situation which dates from before March 10th, [p82] 1926, and still persists at the present time. Nevertheless, the dispute between the Belgian Government and the Bulgarian Government did not arise with regard to this situation or to the awards which established it. The Court would recall in this connection what it said in the Judgment of June 14th, 1938 (Phosphates in Morocco. Preliminary Objection). The only situations or facts which must be taken into account from the standpoint of the compulsory jurisdiction accepted in the terms of the Belgian declaration are those which must be considered as being the source of the dispute. No such relation exists between the present dispute and the awards of the Mixed Arbitral Tribunal. The latter constitute the source of the rights claimed by the Belgian Company, but they did not give rise to the dispute, since the Parties agree as to their binding character and that their application gave rise to no difficulty until the acts complained of. It is not enough to say, as it is contended by the Bulgarian Government, that if it had not been for these awards, the dispute would not have arisen, for the simple reason that it might just as well be said that, if it had not been for the acts complained of, the dispute would not have arisen. It is true that a dispute may presuppose the existence of some prior situation or fact, but it does not follow that the dispute arises in regard to that situation or fact. A situation or fact in regard to which a dispute is said to have arisen must be the real cause of the dispute. In the present case it is the subsequent acts with which the Belgian Government reproaches the Bulgarian authorities with regard to a particular application of the formula - which in itself has never been disputed - which form the centre point of the argument and must be regarded as constituting the facts with regard to which the dispute arose. The complaints made in this connection by the Belgian Government relate to the decision of the Bulgarian State Administration of Mines of November 24th, 1934, and to the judgments of the Bulgarian courts of October 24th, 1936, and March 27th, 1937. These are facts subsequent to the material date. Accordingly, the Court considers that the argument based on the limitation ratione temporis in the Belgian declaration is not well-founded.

[88] In connection with the Belgo-Bulgarian declarations of acceptance of the Court's compulsory jurisdiction, the Bulgarian Government puts also forward another argument in support of its objection to the jurisdiction. In its contention, the present dispute does not fall within any of the categories of Article 36 of the Court's Statute, a general provision which enumerates the legal disputes for which the Court is competent. Although this argument is designed to prove that the Court has no jurisdiction and to prevent the proceedings from being continued, the Court, after considering its scope, has arrived at the conclusion [p83] that this objection is closely linked to the merits of the case. The reasoning in fact aims at establishing that there is no international element in the legal relation created between the Belgian Company and the Bulgarian authorities by the awards of the Mixed Arbitral Tribunal. But that amounts not only to encroaching on the merits, but to coming to a decision in regard to one of the fundamental factors of the case. The Court cannot therefore regard this plea as possessing the character of a preliminary objection within the meaning of Article 62 of the Rules.

[89] In these circumstances, the Court cannot accept the contention that it lacks jurisdiction under the declarations of adherence to the Optional Clause, in so far as this contention is based on the argument ratione temforis; and in so far as this contention is founded on the argument ratione materiœ, the Court does not regard it as preliminary in character and consequently rejects it, though the Parties remain free to take it up again in support of their case on the merits.

[90] The attempt to prove that the Court lacks jurisdiction under the Optional Clause is thus unsuccessful as regards A, No. 1, and A, No. 2.

*

[91] The last complaint adduced by the Belgian Government to the Bulgarian Government - which is formulated in its submissions under A, No. 3, of the Belgian Application, relates to the promulgation of the law of February 3rd, 1936, of which Article 30, paragraph C, institutes a special tax on the distribution of electric power sold to concerns not subject to tax.

[92] In the contention of the Belgian Government, the promulgation of the law constitutes a failure by the Bulgarian Government to observe its international obligations, owing to the discriminatory character of this law.

[93] The Bulgarian Government argues that this contention of the Belgian Government is inadmissible because the claim respecting the law of February 3rd, 1936, did not form the subject of a dispute between the two Governments prior to the filing of the Belgian Application.

[94] The Court considers this argument of the Bulgarian Government to be well-founded. Under either the Treaty of 1931 or the declarations of adherence to the Optional Clause it rested. with the Belgian Government to prove that, before the filing of the Application, a dispute had arisen between the Governments respecting the Bulgarian law of February 3rd, 1936. The Court holds that the Belgian Government has not established the existence of such a dispute and accordingly declares 'that the Belgian Application cannot be entertained in so far as concerns that part of the claim relating to this law. [p84]

[95] FOR THESE REASONS,
The Court, by nine votes to five,
Adjudicating upon the preliminary objection raised by the Bulgarian Government to the Application of the Belgian Government:

1. With regard to points 1 and 2 of Submission A of the Application,
overrules the objection of the Bulgarian Government; reserves this part of the Application of the Belgian Government for judgment on the merits;
states that the time-limits for the continuance of the proceedings will be fixed by an Order bearing the date of the present judgment.
2. With regard to point 3 of Submission A of the Application,
upholds the objection of the Bulgarian Government; and dismisses this part of the Application of the Belgian Government.

[96] The present judgment has been drawn up in French in accordance with Article 39, paragraph 1, of the Statute of the Court, the Parties having agreed that the case should be conducted in French.

[97] Done at the Peace Palace, The Hague, this fourth day of April, one thousand nine hundred and thirty-nine, in three copies, one of which will be deposited in the archives of the Court and the others will be communicated to the Government of the Kingdom of Belgium and to the Government of the Kingdom of Bulgaria, respectively.

(Signed) J. G. Guerrero,
President.
(Signed) J. López Oliván,
Registrar. [p85]

[98] M. Anzilotti, M. Urrutia, Jonkheer Van Eysinga, M. Hudson, Judges, and M. Papazoff, Judge ad hoc, declare that they are unable to concur in the judgment given by the Court and, availing themselves of the right conferred upon them by Article 57 of the Statute, have appended to the judgment the separate opinions which follow.

[99] M. De Visscher and M. Erich, Judges, while in agreement with the operative clause of the judgment, have each appended observations regarding some of the grounds.

(Initialled) J. G. G.
(Initialled) J. L. O. [p86]

Separate Opinion by M. Anzilotti.

[Translation]

[100] I regret that I am unable to agree with the way in which the judgment views the relation between the two sources of jurisdiction relied upon by the applicant Party. This question is so important and its bearing is so wide that I find myself obliged to explain the reasons for my dissent.

[101] 1.- The facts of the situation giving rise to this question are briefly as follows.

[102] On July 29th, 1921, the Bulgarian Government signed a Declaration adhering to the Optional Clause concerning the compulsory jurisdiction of the Permanent Court of International Justice in the following terms :

"On behalf of the Government of the Kingdom of Bulgaria I recognize, in relation to any other Member or State which accepts the same obligation, the jurisdiction of the Court as compulsory ipso facto and without any special convention, unconditionally."

[103] This Declaration was ratified on August 12th of the same year.

[104] The Belgian Government signed its Declaration accepting the compulsory jurisdiction of the Court on September 25th, 1925. This Declaration is as follows :

"On behalf of the Belgian Government, I recognize as compulsory, ipso facto and without special agreement, in relation to any other Member or State accepting the same obligations, the jurisdiction of the Court in conformity with Article 36, paragraph 2, of the Statute of the Court for a period of fifteen years, in any dispute arising after the ratification of the present Declaration with regard to situations or facts subsequent to this ratification, except in cases where the Parties have agreed or shall agree to have recourse to another method of pacific settlement."

[105] The ratification was deposited on March 10th, 1926.

[106] Article 36 of the Court's Statute to which the two Declarations refer is as follows :

"The jurisdiction of the Court comprises all cases which the parties refer to it and all matters specially provided for in treaties and conventions in force.
The Members of the League of Nations and the States mentioned in the Annex to the Covenant may, either when signing [p87] or ratifying the Protocol to which the present Statute is adjoined, or at a later moment, declare that they recognize as compulsory ipso facto and without special agreement, in relation to any other Member or State accepting the same obligation, the jurisdiction of the Court in all or any of the classes of legal disputes concerning :
(a) the interpretation of a treaty;
(b) any question of international law;
(c) the existence of any fact which, if established, would constitute a breach of an international obligation ;
(d) the nature or extent of the reparation to be made for the breach of an international obligation.
The Declaration referred to above may be made unconditionally or on condition of reciprocity on the part of several or certain Members or States, or for a certain time.
In the event of a dispute as to whether the Court has jurisdiction, the matter shall be settled by the decision of the Court."

[107] As a result of these Declarations, an agreement came into existence between the two States accepting the compulsory jurisdiction of the Court, in conformity with Article 36 of the Statute and subject to the limitations and conditions resulting from the declarations, more especially from that of the Belgian Government. This agreement, hereinafter referred to as the Declarations, came into force on March 10th, 1926, the date of the Belgian ratification. The Bulgarian Declaration is made without limitation of time, but the Belgian Declaration being made for a period of fifteen years as from the date of ratification, the duration of the Declarations is until March 10th, 1941.

[108] On the other hand Belgium and Bulgaria, on June 23rd, 1931, signed a Treaty of conciliation, arbitration and judicial settlement which was ratified on February 4th, 1933, and Chapter II of which, entitled "Judicial Settlement", deals, inter alia, with recourse to the Court.

[109] The articles of the Treaty of June 23rd, 1931, which should be kept in mind on the one hand for comparison with the text of the Declarations and of Article 36 of the Statute on the other, are in particular Articles 4, 1 and 3. The first directly concerns recourse to the Court ; the other two, which are in Chapter I which is entitled "Pacific Settlement in general", apply to all the procedures contemplated by the Treaty and consequently also to recourse to the Court. These Articles are as follows :

Article 4. - "All disputes with regard to which the Parties are in conflict as to their respective rights shall be submitted for decision to the Permanent Court of International Justice, unless the Parties agree, in the manner hereinafter provided, to have resort to an arbitral tribunal. [p88]

[110] It is understood that the disputes referred to above include in particular those mentioned in Article 36 of the Statute of the Permanent Court of. International Justice."

Article 1 . - "Disputes of every kind which may arise between the High Contracting Parties and which it may not have been possible to settle by diplomacy shall be submitted, under the conditions laid down in the present Treaty, to judicial settlement or arbitration, preceded, according to circumstances, as a compulsory or optional measure, by recourse to the procedure of conciliation."
Article 3. - "1. In the case of a dispute the occasion of which, according to the municipal law of one of the High Contracting Parties, falls within the competence of its judicial or administrative authorities, the Party in question may object to the matter in dispute being submitted for settlement by the different methods laid down in the present Treaty until a decision with final effect has been pronounced within a reasonable time by the competent authority.
2. In such a case, the Party which desires to resort to the procedures laid down in the present Treaty must notify the other Party of its intention within a period of one year from the date of the aforementioned decision."

[111] This treaty, hereinafter called the Treaty, was concluded for a period of five years as from the date of exchange of ratifications and was to be automatically renewed for successive periods of five years unless denounced at least six months before the expiration of a five year period. It was denounced by the Bulgarian Government on August 3rd, 1937, and thus expired on February 4th, 1938.

[112] The Application of the Belgian Government was filed on January 25th, 1938, that is to say before the date of expiration of the Treaty ; the question therefore arises which of the rules of the Declarations and of the Treaty are applicable to it ; in other words whether the Declarations, or the Treaty, or both are to be taken as the basis in examining the question whether the Court can entertain the Application and adjudicate upon the merits of the case. It is with regard to this question that I find it impossible to agree with the standpoint adopted in the judgment.

[113] In my opinion, when the Belgian Government's Application was filed, only the Treaty was applicable between the two States, and it is on the basis of the Treaty and of the Treaty alone that it has to be decided whether the Court can entertain the Application and adjudicate on the merits.

[114] 2. - Before setting out my arguments, one observation is necessary.

[115] The Belgian Government relies upon both the Declarations and the Treaty in order to establish the jurisdiction of the [p89] Court to adjudicate upon its Application. It is not quite clear whether that Government relies upon them both equally or whether it places more reliance on one than on the other, and if so which: in the course of the written proceedings and more especially in the oral proceedings, there were signs of some indecision on the point, so that it is difficult to form an absolutely definite opinion on this subject. I regard it however as certain that the Belgian Government holds that it can rely on both sources of the Court's jurisdiction.

[116] As for the Bulgarian Government, in its Memorial it disputed the jurisdiction of the Court under either the Declarations or the Treaty ; and at the oral proceedings its Agent positively maintained, contrary to certain observations of Counsel for the Belgian Government, that the coming into force of the Treaty had not suspended the operation of the Declarations. It may therefore be said that both the Parties consider that the Declarations and the Treaty are alike applicable in this case.

[117] It appears to me certain however that this attitude on the part of the Parties can neither dispense the Court from itself examining and answering the purely legal question of the relation between the two sources of its jurisdiction nor in any way restrict its freedom in this respect.

[118] The position would perhaps be different if the agreement between the Parties had been in regard to the question whether the Court has jurisdiction or not. But here the situation is quite otherwise: the Belgian Government maintains and the Bulgarian Government denies that the Court has jurisdiction. The agreement, if we can call it an agreement, only relates to the sources of law to be applied. Such an agreement, which clearly results from the way in which each Party views the interests of its own defence, is of no importance for the Court.

[119] 3. - If we compare the text of the Declarations, which, together with Article 36 of the Statute, determine the content of the Agreement concluded between the two Governments, with the articles of the Treaty reproduced above, it is easy to see that these constitute two conventions between the Belgian Government and the Bulgarian Government which lay down different rules for the same thing, namely recourse to the Court. 1

[120] Confining myself to the points of most importance in this case, I would make the following observations.

[121] Under a clause of the Belgian Declaration which, by virtue of the condition of reciprocity, is binding as between the Parties, the Declarations except from the compulsory jurisdiction of the Court disputes which, though falling under one or more of the categories set out in Article 36 of the Statute and arising subsequent to the ratification of the Declaration, have [p90] not arisen "with regard to situations or facts subsequent to this ratification". The Treaty does not make this reservation : all disputes of this kind which may arise after ratification, definitely fall within the Court's jurisdiction, as defined in Article 4, even if they have not arisen "with regard to situations or facts subsequent to this ratification".

[122] On the other hand, the Treaty makes recourse to the Court subject to the conditions laid down in Articles 1 and 3, namely: in all cases there must have been preliminary diplomatic negotiations which have proved unsuccessful and, in certain cases, there must exist a decision with final effect rendered by the competent judicial or administrative authorities. The Declarations do not make these conditions; the interested Party cannot therefore rely upon them to prevent the submission of the case to the Court. I leave aside the question whether, and within what limits, any analogous rules of general international law might be invoked against recourse to the Court under the Declarations. It is clear in any case that that is something quite different from the application of Articles 1 and 3 of the Treaty.

[123] It follows that there are or may be cases where recourse to the Court is permitted by the Treaty but not by the Declarations, and cases where recourse to the Court is possible under the Declarations but not under the Treaty.

[124] It is clear that, in the same legal system, there cannot at the same time, exist two rules relating to the same facts and attaching to these facts contradictory consequences. It is for instance impossible that the relations between two States should be governed at one and the same time by a rule to the effect that, if certain conditions are fulfilled, the Court has jurisdiction and by another rule laying down that, if the same conditions are fulfilled, the Court has no jurisdiction - by a rule to the effect that in certain circumstances the State concerned may have recourse to the Court and by another to the effect that in the same circumstances-the State has no right to do so, etc., etc. In cases of this kind, either the contradiction is only apparent and the two rules are really coordinated so that each has its own sphere of application and does not encroach on the sphere of application of the other, or else one prevails over the other, i.e., is applicable to the exclusion of the other. I know of no clearer, more certain, or more universally accepted principle than this.

[125] To decide whether a contradiction between two rules is only apparent and how they should be co-related to one another, or to determine which of two contradictory rules applies to the exclusion of the other, is among the most important and most [p91] difficult tasks in the interpretation of legal texts. It is precisely this task which confronts the Court in the present case.

[126] 4. - The Treaty being of later date than the Declarations, it is in the text of the former that we must seek the intention of the Parties in regard to rules previously in force.

[127] In this connection Article 4 of the Treaty seems to me of decisive importance.

[128] This Article, having in its first paragraph formulated the general rule that all disputes with regard to which the Parties are in conflict as to their respective rights shall be submitted for decision to the Permanent Court of International Justice, lays down in paragraph 2 : "It is understood that the disputes referred to above include in particular those mentioned in Article 36 of the Statute of the Permanent Court of International Justice."

[129] It follows, in the first place, that all disputes, without exception, which may be submitted to the Court under the Declarations, may henceforward be submitted to it under the Treaty. Whilst the clause in the first paragraph: "disputes with regard to which the Parties are in conflict as to their respective rights", may possibly extend beyond the classes of disputes in Article 36 of the Statute, it is altogether out of the question that any dispute falling within the classes of Article 36 of the Statute, shall not be included in Article 4 of the Treaty. It also follows that the disputes mentioned in Article 36 of the Statute and therefore forming the subject-matter of the Declarations, are henceforth disputes "included" in Article 4 of the Treaty : ".... the disputes referred to above include in particular those....". This amounts to saying that they are disputes to which Article 4 is applicable as well as the other articles of the Treaty which apply to the disputes referred to in Article 4.

[130] Accordingly, the Treaty covers all disputes contemplated in the Declarations and subjects them to its specific rules.

[131] This interpretation, which appears to follow naturally from the text of Article 4, seems to me to be in perfect accord with the intention of the Parties when they concluded their Treaty of conciliation, arbitration and judicial settlement. Both States proposed to adopt a number of pacific methods of "settling all international disputes" ; thus, the system was to be complete and one in which every class of dispute was to receive the treatment best suited to it. Since the disputes mentioned in Article 36 of the Court's Statute are an important part of the disputes contemplated by the Treaty, nothing was more natural than to extend to those disputes the system of rules and [p92] safeguards which the contracting Parties thought necessary or expedient for the attainment of their purpose.

[132] If, for example, they thought that the judicial settlement of a dispute might usefully be preceded by diplomatic negotiations, why should they not have extended this rule to the disputes mentioned in Article 36 ? If it seemed just or opportune in certain cases to give the interested Party a right to object to the method of settlement laid down in the Treaty being employed until a decision with final effect had been pronounced by the competent judicial or administrative authority, it was only natural to apply that rule also to the disputes mentioned in Article 36, whenever those disputes present the features in view of which the rule was adopted.

[133] On the other hand, it was necessary to ensure that any limitation or reservation which the contracting Parties, or one of them, might have attached to their acceptance of the Court's compulsory jurisdiction under Article 36 of the Statute, should not take effect during the current period of the Treaty. For, by excluding from the jurisdiction of the Court certain of the disputes mentioned in Article 36 or by subordinating that jurisdiction to other conditions than those contemplated in the Treaty, the said limitations or reservations would have created a class of disputes not compulsorily subject to pacific settlement, whereas the purpose of the Treaty, as appears ipsis verbis in Article 1, was to ensure the settlement of all disputes that might arise between the two States.

[134] It appears evident, therefore, that the rule approved in Article 4, paragraph 2, of the Treaty, as I understand it, namely, as comprising within this Article, and thus making subject to the Treaty, the disputes mentioned in Article 36 of the Statute of the Court, is only a logical consequence of the purpose and plan of this Treaty.

[135] 5. - Since the Treaty covers all disputes referred to in the Declarations, the question arises whether the latter must not be held to have been abrogated by the Treaty.

[136] There was no express abrogation. But it is generally agreed that, beside express abrogation, there is also tacit abrogation resulting from the fact that the new provisions are incompatible, with the previous provisions, or that the whole matter which formed the subject of these latter is henceforward governed by the new provisions
[137] I consider that it would be difficult to resist the argument in favour of tacit abrogation, were it not for the following circumstance.

[138] The Declarations and the Treaty have not the same period of validity, nor an indefinite period. As has already been seen, [p93] the periods of duration of the Declarations and of the Treaty were such that the life of the Declarations continued beyond that of the Treaty.It follows that the coming into force of the Treaty did not entirely do away with the raison d'être of the Declarations : this raison d'être ceased for so long as the Treaty should be in force ; but it revived as soon as the Treaty should terminate. On the other hand, a treaty whose purpose was to extend and strengthen the peaceful settlement of disputes between the two States cannot be deemed to have intended to set aside, save in so far as was strictly necessary, an agreement which, in a more limited way, pursued the same object. While it is true that once the Treaty had come into force, it left ho room for the application of the Declarations, it is also true that it had no need to suppress them.

[139] In these circumstances, it is not the abrogation of the Declarations, but its temporary suspension which we must consider to be the effect of the coming into force of the Treaty. It follows that the expiration of the Treaty eliminated the obstacle standing in the way of the application of the Declarations. The latter, never having ceased to be in force, again became applicable at the same moment as the Treaty terminated, namely March 4th, 1938.

[140] The conclusion is that, at the moment when the Belgian Government's Application was submitted (Jan. 26th, 1938), only the Treaty was applicable. Consequently, the soundness of the objection to the jurisdiction raised by the Bulgarian Government must be appreciated on the basis of the Treaty alone.

[141] 6. - Before proceeding to this examination, it may be well to make clear what are the claims of the Belgian Government against which the objection is directed.

[142] The latter Government formulated its claims in the Application under two heads, A and B. The purpose of the claim under A is to obtain from the Court a judgment declaring that, owing to certain acts, Bulgaria has failed in its international obligations towards Belgium; that under B concerns reparations in respect of these alleged failures. This latter claim which, in the Memorial, is divided into two - letter B relating to restitutio in -pristinum and letter C to reparation of damage sustained - is without importance at the present stage of proceedings.

[143] The alleged failure by Bulgaria to observe its international obligations is indicated under three numbers in claim A : (1) concerns the bringing into effect by the State Mines Administration on November 24th, 1934, of a special artificial tariff for coal supplied to electric power stations ; (2) concerns the judgments rendered by the Regional Tribunal and by the Sofia [p94] Court of Appeal on October 24th, 1936, and March 27th, 1937, respectively; (3) concerns the promulgation of the law of February 3rd, 1936, of which Article 30 (c) establishes a special tax on the distribution of electric current purchased from undertakings not subject to the tax.

[144] It must however be pointed out that complaint is made against the tariff of November 24th, 1934, only because its object is alleged to have been to enable the Municipality of Sofia wrongly to apply the awards of the Mixed Arbitral Tribunal of 1923 and 1925. As complaint is also made against the judgments of the Regional Tribunal and of the Sofia Court of Appeal on the ground that they deprived the Company of the benefit of these awards of the Mixed Arbitral Tribunal, it seems evident that there is here one single alleged breach of Bulgaria's international obligations, consisting at one time of acts of the administrative authorities (1), and at another time of acts of the judicial authorities (2). While making every reservation as to what were the international obligations thus violated by the Bulgarian administrative and judicial authorities, it is therefore possible to regard Nos. 1 and 2 of conclusion A, so far as the Court's jurisdiction is concerned, as one single claim.

[145] On the other hand (3) which relates to an alleged discrimination in the imposition of taxes does not concern the awards of the Mixed Arbitral Tribunal or the obligations resulting therefrom for the Bulgarian Government. It must therefore be dealt with separately even in connection with the Court's jurisdiction.

[146] Thus there are two claims, the first being Nos. 1 and 2 and the second No. 3 of conclusion A. This seems to be in accordance with the statements of the Applicant.

[147] Against the possibility of the Court's giving judgment on these claims, the Bulgarian Government, if I am not mistaken, puts forward three arguments based on the Treaty : the Belgian Government's claims, or at any rate the first of these, are said not to fall within the category of disputes which, under Article 4, are to be submitted to the Court ; the condition laid down by Article 3 is not fulfilled as regards either the first or the second claim ; finally, as regards the second claim, the condition required by Article 1 is lacking.

[148] 7. - It is not easy to say exactly what is the objection which the Bulgarian Government claims to draw from the matter of the dispute before the Court. It would appear, however, that it may be summed up as follows : the right which the Belgian Government denies to the Bulgarian Government is, in reality, the right of Bulgarian courts to try disputes between a Belgian [p95] company that is a concessionaire of public undertakings in Bulgaria, and a Bulgarian Municipality; now this right is inherent in the sovereignty of the State and falls within Bulgaria's exclusive jurisdiction, and the Belgian Government cannot invoke the Treaty of 1931 in order to come before the Court.

[149] If that really is the Bulgarian Government's objection, it seems to me certain that it is not a preliminary objection against the Court's jurisdiction, but a defence on the merits. A preliminary objection is an objection of which the purpose and the effect are to prevent the continuance of proceedings before the Court, without prejudging the question whether the right claimed by the Applicant exists or not. Now it is clear that if the Court gave a decision on the Bulgarian objection, it would in reality be admitting or denying the right claimed by Bulgaria, without having heard the merits.

[150] This objection cannot therefore be upheld, for it is not of the nature of a preliminary objection. It is hardly necessary to add that the Bulgarian Government is quite free to put forward its argument during proceedings on the merits.

[151] 8. - The Bulgarian Government's second complaint is based upon Article 3 of the Treaty, which says : "In the case of a dispute the occasion of which, according to the municipal law of one of the High Contracting Parties, falls within the competence of its judicial or administrative authorities, the Party in question may object to the matter in dispute being submitted for settlement by the different methods laid down in the present Treaty until a decision with final effect has been pronounced within a reasonable time by the competent authority." It has already been said that this complaint is directed against both the first and the second of the Belgian Government's claims. It should, however, be examined separately in respect of each.

[152] A. It is agreed between the Parties that, at the time when the Application was submitted, the Tribunal of first instance and the Sofia Court of Appeal had already adjudicated upon the claims of the Sofia Municipality and the Belgian Company, but that the Court of Cassation with which the Company had lodged an appeal on June 23rd, 1937, did not deliver its judgment until March 16th, 1938 - that is, after the filing of the Application. The Belgian Government does not deny that the judgment was pronounced within a reasonable time.

[153] The Parties agree that the dispute between the Municipality of Sofia and the Belgian Company, which forms the subject of the present dispute between Belgium and Bulgaria, falls within the competence of the Bulgarian authorities.

[154] The Belgian Government does not claim that the Bulgarian Government did not comply with Article 3 of the Treaty in [p96] objecting to the dispute being submitted to the Court. It alleges, however, either that the condition laid down in Article 3 was already fulfilled on January 26th, 1938 ; or that, following denunciation of the Treaty by Bulgaria, Belgium was not obliged to await its fulfilment ; or, finally, that, since the effect of the condition is purely suspensory, it cannot be invoked now that the Court of Cassation has given a decision with final effect.

[155] In my opinion none of these arguments holds.

[156] (a) The contention that the condition required by Article 3 of the Treaty was already fulfilled on January 26th, 1938, was upheld, if I remember rightly, from two points of view. Firstly, it was argued that the matter needed only to have been submitted to the highest national court; it was not necessary that that court should have delivered judgment. Secondly, and with greater force, it was urged that, since the appeal to the Court of Cassation was a remedy of an exceptional nature, it could not prevent the judgment of the Court of Appeal being regarded as the decision with final effect within the meaning of Article 3 of the Treaty.

[157] As regards the first point, irrespective of whether there may be cases in which the rule of international law commonly known as the "local redress rule" is complied with by the mere submission of a case to the highest jurisdiction in the land, I do not see how this plea could be accepted in the face of a treaty text which requires a "decision with final effect". Either the judgment given by the Court of Appeal is such a decision, or the existence of such decision must be awaited. The mere fact of having applied to the supreme jurisdiction does not here carry any weight.

[158] Indeed, the representatives of the Belgian Government relied mainly upon the alleged finality of judgments given by the Court of Appeal.

[159] The question depends, firstly, upon the meaning that is to be attached to the words "decision with final effect" in Article 3 of the Treaty and, secondly, upon the force and effects of judgments given by the Court of Appeal under the municipal law of the country in which those judgments are given. The first matter is a question of treaty interpretation and thus of international law ; the second a question of Bulgarian law.

[160] In order to determine the meaning of the words "decision with final effect", we have to ascertain what the Parties had in view when they laid down the stipulations of Article 3 of the Treaty. In my opinion they wanted to enable the interested State to prevent an international dispute from arising as long as there was a means of removing its cause through a decision by the national authorities. It follows that no "decision with final effect", as required by Article 3, has been [p97] given until the adopted decision can no longer be altered, at any rate so far as concerns the matters capable of leading to an international dispute. A decision which can be amended, cancelled, or replaced by another is not the decision contemplated by the Parties, whatever colour may be given to it by the municipal law of the country in which it was issued.

[161] It is agreed that, under Bulgarian law as under the law of several other countries, for as long as there is the possibility of an appeal to the Court of Cassation or as long as such appeal is pending, a judgment by an appeal court is one that can be cancelled and replaced by another judgment which, in fact as well as in law, may be absolutely different. Should the Court of Cassation quash the judgment appealed against, the whole case reverts absolutely to the condition in which it stood immediately after the judgment by the lower court; a new case on appeal is heard, involving a re-examination of the facts and of the law, ending in a judgment that may be altogether different from the previous one.

[162] In view of these circumstances, I really do not see what importance can be ascribed, either to the exceptional character given by Bulgarian and other law to the appeal to a court of cassation, for reasons and from considerations which have nothing to do with the question before us; or to the fact that, for similar considerations, the sentence by the Court of Appeal is described as final or given by the last instance; or again, to the fact that the Court of Cassation pronounces only upon questions of law, etc., etc. The one important point is that the judgment by the Court of Appeal, from which appeal is lodged with the Court of Cassation, is a judgment which may be cancelled and replaced by another quite different judgment ; that is exactly the contrary of what the Parties desired when they required a "decision with final effect".

[163] (b) The second argument, namely, that the denunciation of the Treaty by the Bulgarian Government released the Belgian Government from the duty of awaiting the result of the recourse to cassation, is based mainly upon the consideration that, since the Treaty was about to expire, it became impossible to submit the Application.

[164] This argument seems to me no better founded than the first argument. If the Bulgarian Government had the right to denounce the Treaty, it was perfectly natural that the Belgian Government should be rendered incapable of benefiting by it. It is impossible to describe as force majeure what was really only a consequence of the exercise by the Bulgarian Government of its right of denunciation.

[165] True, the representatives of the Belgian Government alluded cautiously to an abuse of right said to have been committed [p98] by the Bulgarian Government when it denounced the Treaty in order to remove from the jurisdiction of this Court the case which the Belgian Government was proposing to submit.

[166] The theory of abuse of right is an extremely delicate one, and I should hesitate long before applying it to such a question as the compulsory jurisdiction of the Court. The old rule, a rule in such complete harmony with the spirit of international law, Qui iure suo utitur neminem Iœdit, would seem peculiarly applicable. The Bulgarian Government was entitled to denounce the Treaty and was sole judge of the expediency or necessity of doing so.

[167] The situation might be somewhat different if the Bulgarian Government, being free to denounce the Treaty at any time, had chosen the particular moment at which it had been informed of the Belgian Government's intention to apply to the Court. But that is not the case. At the time when it learnt of the Belgian Government's decision, the Bulgarian Government had only a few days in which to denounce the Treaty under Article 37, Nos. 2 and 3, if it did not wish to be bound for a further period of five years.

[168] Finally, the Treaty once expired, the Belgian Government was still able to apply to the Court under the Declarations. And the Belgian Government, by basing its application not only on the Treaty but also on the Declarations, showed its belief that those Declarations empower the Court to adjudicate on the present question. There was therefore no periculum in mora.

[169] (c) There remains only the argument that the local redress rule, being of a suspensory character, can no longer be invoked now that the Court of Cassation has delivered its judgment.

[170] I do not deny that the so-called local redress rule, when invoked by one of the parties to a case, may on occasions simply serve to suspend proceedings ; this will probably be the case if the rule is invoked as an objection to the merits.

[171] But in this case, the Court is not confronted with a rule of common international law; it is dealing with a specific and formal provision, Article 3 of the Treaty, which it is required to apply. And this Article grants to the interested Party the right to "object to the matter in dispute being submitted" to the Court. It is therefore absolutely certain that we are concerned with a condition governing application to the Court and that the condition has to be fulfilled at the time when the Court is applied to.

[172] The objection by the Bulgarian Government is therefore well-founded in respect of the first claim of the Application. [p99]

[173] B. On the other hand, the objection appears to me to be ill-founded in respect of the second claim in the Application, viz., the promulgation of the law of February 3rd, 1936, imposing a special tax on the distribution of electric power purchased from concerns not subject to the tax.

[174] In reply to the Belgian Government's objection that there is no remedy against the acts of the legislative authority, the representatives of the Bulgarian Government merely declared that there is such remedy against the application of the law.

[175] Making every reservation as to whether the mere promulgation of a law like the Bulgarian law of February 3rd, 1936, can constitute a breach of international obligations as claimed by Belgium, there is no denying that the Application refers to the promulgation of the law, and to its promulgation only. It is certain, however, that Bulgarian law, like the laws of nearly all, if not all, countries, knows of no remedy against promulgations of a law. Article 3 of the Treaty does not therefore apply.

[176] 9. - The third complaint of the Bulgarian Government is based on Article 1 of the Treaty, according to which only disputes "which it has not been possible to settle by diplomatic means" shall be submitted for settlement by the different methods laid down in the Treaty.

[177] The Bulgarian Government admits that, in regard to the points forming the subject of. the Application's first claim (submission A (1) and (2)), there were diplomatic negotiations and that they led to no result ; this complaint therefore does not concern the said claim.

[178] With regard to the second claim (submission A (3)), the Bulgarian Government declared in its Memorial that the claim relating to the text established by the law of 1936 was an entirely fresh one and that no attempt had ever been made to settle it by the diplomatic means referred to in Article 1 of the Treaty.

[179] The Belgian Government's Supplementary Memorial appears to admit that there were no diplomatic negotiations on this point. It merely replies that, according to the Court's jurisprudence, the Belgian Government needed only to determine, after the failure of its representations made in regard to the decisions given by the Bulgarian courts, that it was useless to enter into special negotiations regarding the complaint based on the fiscal law of 1936, a complaint notified to it by the Company "subsequently".

[180] At this point, therefore, it could be taken as established that the Belgian Government's second claim had not formed the subject of diplomatic negotiations.

[181] During the oral proceedings the Belgian Government's Agent reverted to this point and said that, in the course of the many [p100] diplomatic representations made by his Government, these secondary grounds of complaint had also been mentioned, and he offered to produce evidence of this fact if the Court thought it desirable.

[182] In view of the summary character of the procedure mentioned in Article 62 of the Rules and the formal provisions contained in Nos. 2 and 3 of that Article with regard to evidence, I doubt very much indeed whether the Court could have accepted the offer made in the circumstances referred to above by the Agent for the Belgian Government. In any event I can only state that the evidence was not furnished and that the Belgian Government's claim does not fulfil the condition required by Article 1 of the Treaty.

[183] 10. - My opinion may be summarized as follows.

[184] The entry into force of the Belgo-Bulgarian Treaty of June 23rd, 1931, suspended for the whole term of the Treaty, namely, from February 4th, 1933, until February 4th, 1938, the applicability of the Agreement resulting from the Belgian and Bulgarian Declarations accepting the Court's compulsory jurisdiction in accordance with Article 36 of its Statute.

[185] At the time when the Belgian Government filed its Application, the Treaty was still in force. It follows that the Application was required to fulfil the conditions laid down in the Treaty and that it is on that basis that we have to appraise the justice of the preliminary objection to jurisdiction lodged by the Bulgarian Government.

[186] In as much as that Government pleads that the first claim of the Belgian Government (submission A (1) and (2)) does not fulfil the condition laid down in Article 3 and that the second claim (submission A (3)) does not fulfil the condition laid down in Article 1 of the Treaty, the objection is well-founded. The Court should have accepted it and disclaimed jurisdiction.

[187] I need scarcely add that the Belgian Government could have submitted a fresh application based this time upon the Belgian and Bulgarian Declarations accepting the Court's compulsory jurisdiction, Declarations that became again applicable in relations between the two States from February 4th, 1938, onwards.

(Signed) D. Anzilotti. [p101]

Dissenting Opinion by M. Urrutia.

[Translation]

[188] The Application of the Belgian Government against the Bulgarian State in regard to the Electricity Company of Sofia and Bulgaria declares that that Government, for the purposes of proceedings before the Court, relied upon:

(1) the declarations of adherence made by Belgium and Bulgaria to the optional clause accepting as compulsory the jurisdiction of the Court, which declarations were respectively ratified on March 10th, 1926, and August 12th, 1921 ;
(2) the Treaty of conciliation, arbitration and judicial settlement concluded between the two countries on June 23rd, 1931.

[189] In the Statement of the Law contained in the Belgian Memorial (p. 18), the Court's jurisdiction was derived in the first place from Article 4 of the said Treaty of conciliation, arbitration and judicial settlement, but the Memorial added: "In addition, if a further source were necessary, the Belgian Government bases the jurisdiction of the Permanent Court of International Justice upon the declarations by which Belgium and Bulgaria adhered to the optional clause of the Statute of the Court", etc.

[190] In the Statement of Facts in the same Memorial (p. 17), reference is made to the note sent by the Belgian Minister in Sofia to the Bulgarian Minister for Foreign Affairs on June 24th, 1937 (Annex 56 of the Belgian Memorial), in which the Belgian Minister notified the intention of his Government to submit the dispute to the Court, "the present dispute falling within the class of those which Articles 4 and 6 of the Treaty of conciliation concluded between Bulgaria and Belgium on June 23rd, 1931, permit to be submitted unilaterally to the Permanent Court of International Justice", etc.; in brackets these words are added : "(whose compulsory jurisdiction Bulgaria moreover accepted under the optional clause on August 27th, 1921)".

[191] The Belgian Government's Additional Memorial states that the Treaty of conciliation, arbitration and judicial settlement is, in the second place, the basis of the Court's jurisdiction. The Statement of Law in the Memorial of the Bulgarian Government introducing its preliminary objection implies that the Bulgarian Government also understood the Belgian Application in this sense.

[192] It would appear that the first question to be asked in order that the Court may establish its jurisdiction is whether the Bulgarian Government's objection is to be settled on the basis [p102] of the Treaty already several times mentioned or on that of the optional clause or on the two texts conjointly.

[193] Me. Rolin, Counsel for the Belgian Government, speaking in Court in the morning of March 1st, 1939, expressed his views on this question and concluded as follows :

"Until February 3rd, 1933, our relations were governed by the optional clause, subject to the conditions specified in our respective declarations of acceptance.
From February 3rd, 1933 - the date of the coming into force of the Treaty of 1931 - till February 3rd, 1938, our relations were governed by that Treaty.
From February 3rd, 1938, up to the present time, our relations are again governed by the optional clause."
"It seems rather strange that, after the written proceedings and after the arguments which you have heard, you should be invited to decide as to your jurisdiction in a single dispute between two States on the basis of two series of documents which have been examined in succession, just as if there were two clauses in force during the said period between Belgium and Bulgaria having to be applied in a separate manner, two documents unrelated to one another, two systems of rules to which you are invited to refer in succession.... It seems to me preposterous to suppose that it was the intention of Belgium and Bulgaria to create another additional system which would be in force during the same period as the optional clause that already bound us, and would have cumulative effect."

[194] At the afternoon hearing of the same day, Me. Rolin modified his earlier opinion and expressed another view to the effect that "in this second intermediate period - during which Belgium filed her Application - the Court should take into consideration the optional clause together with any amendments to it effected by the Treaty between Belgium and Bulgaria" (Exposés oraux, Distr. 4225).

[195] M. Altinoff, Agent for the Bulgarian Government, disputed the arguments adduced by Me. Rolin in his first statement and,, according to the Bulgarian Agent, the Treaty of arbitration, conciliation, etc., between Belgium and Bulgaria makes no change so far as concerns judicial settlement and leaves the previous situation wholly intact.

[196] In order to decide this question, the Court is not obliged to adopt the legal ground taken up by either Party, but is quite free to reach a decision in accordance with its own judgment, even if both Parties defend the same legal argument, should the Court consider that that argument lacks foundation.

[197] It is not only the right, but the duty of the Court ex officio to make sure of its jurisdiction, that is of its power to take [p103] cognizance of a case in accordance with the texts governing the said jurisdiction (Art. 53 of the Statute).

***

[198] Bulgaria's declaration accepting the jurisdiction of the Court under Article 36 of the Court's Statute was signed on July 29th, 1921; it was ratified on August 12th, 1921, and contains no reservation, but only the general condition of reciprocity.

[199] The declaration by Belgium is limited to fifteen years in any disputes arising after the ratification with regard to situations or facts subsequent to this ratification, except in cases where the Parties have agreed or shall agree to have recourse to another method of pacific settlement.

[200] The Belgian declaration was ratified on March 10th, 1926, which date fixes the entry into force as between Belgium and Bulgaria of the aforesaid declarations, under the reciprocity clause.

[201] The Treaty of conciliation, arbitration and judicial settlement signed between Bulgaria and Belgium on June 23rd, 1931, was ratified on February 4th, 1933. It was denounced on August 3rd, 1937, and expired on February 4th, 1938, in accordance with Article 37.

[202] The adherence of the two Parties to Article 36 of the Statute of the Court is equivalent in law to an international agreement between them within the limits fixed by the reservations in the Belgian declaration. The undertaking could be modified either by extending or restricting the obligations, or by supplementary provisions embodied in some later agreement.

[203] The said Treaty between Belgium and Bulgaria defined and amplified the mutual undertakings following from their acceptance of Article 36 of the Court's Statute through the introduction of fresh provisions for judicial settlement, through the creation of a supplementary legal system in relation with the said settlement.

[204] The reservation ratione temporis contained in the Belgian declaration cannot be invoked during the current period of the 1931 Treaty. It is surely out of the question to apply simultaneously, in the same dispute and by the same court, one treaty stipulation excluding certain disputes from judicial settlement, and another stipulation providing for them. One stipulation or the other must prevail. In the present case it is the Treaty, which is a later law between the Parties, a special law, the text of which is so perfectly clear that there can be no choice of construction, still less any confusion.

[205] Under Article 3 of the said Treaty, the High Contracting Parties agreed to establish certain special conditions before [p104] an application could be submitted, to the Court. This Article, which is Article 31 in the General Act of conciliation, arbitration and judicial settlement adopted by the Assembly of the League of Nations on September 26th, 1928, laid down an express condition governing an appeal to the compulsory jurisdiction of the Court as accepted in the declarations relating to that jurisdiction in accordance with Article 36 of the Statute. That condition, which appears in one form or another in the many treaties which followed the General Act, means that the High Contracting Parties, by a solemn and positive act, accept that principle of international law concerning exhaustion of internal remedies, a principle already generally acknowledged as one of those to which paragraph 3 of Article 38 of the Court's Statute refers, and which the Court recently confirmed, so happily in its recent judgment in the case of the Panevezys-Saldutiskis Railway between Estonia and Lithuania.

[206] The application of the ordinary rule of international law concerning exhaustion of local remedies, which in my opinion, is binding in connection with the introduction of any application whatever to the Court under the optional clause, is in. the present case altogether inevitable, arising as it does out of the express stipulation of a treaty. Article 38 of the Court's. Statute mentions as the first of the sources of law to be applied :: international conventions establishing rules expressly recognized-by the contesting States.

[207] Accordingly, for as long as the 1931 Treaty was in force, Article 3 is the Article which must govern the jurisdiction of the Court in the case of an application filed by one of the High Contracting Parties. If the Parties, by merely invoking the acceptance of the Court's jurisdiction contained in their declarations of adherence, could set aside this fundamental clause in the Treaty, the latter would have a purely academic value and no practical efficacy whatever.

[208] Article 7 of the 1931 Treaty also inserted a new and additional clause connected with the judicial settlement of any dispute between the High Contracting Parties. It was provided that, if conciliation failed, a certain time must elapse before an application could be submitted to the Court.

[209] Articles 33 and 34 of the Treaty contain further provisions concerning judicial settlement.

[210] The Treaty established a whole legal system supplementing and determining the exercise of the Court's compulsory jurisdiction as accepted by the Parties. The latter did not forget their declarations of adherence, and Article 4 of the Treaty expressly provides that the disputes to which it refers include [p105] in particular those mentioned in Article 36 of the Statute of the Permanent Court of International Justice. Article 31 of the Treaty also refers to the rules in regard to the substance of the dispute indicated in Article 38 of the Statute. It may therefore be concluded that the Parties intended to incorporate the general system of law arising out of the acceptance of the Court's compulsory jurisdiction within another system more precise and more comprehensive and which the Parties no doubt thought best adapted to their mutual interests.

[211] The Treaty cannot be said to have cancelled, abrogated or suspended the legal effects of the declarations, but it made them subject to such conditions that, during the term of the Treaty, the Court's jurisdiction may only be exercised in accordance with those conditions.

[212] If it were to be allowed that two provisions, governing the jurisdiction of the Court in a different and even a contrary manner, were simultaneously applicable, it would follow that the Court can possess jurisdiction in a certain case under one of these provisions, while possessing no jurisdiction under another. Such a situation seems to me hardly permissible from the legal point of view, nor, I think, would it accord with the Wish of the Parties as expressed in the text of the instruments by which they are bound.

[213] If it is inadmissible under municipal law that the jurisdiction of the Court should be governed by one law which establishes its jurisdiction and by another law which excludes it, it is equally impossible to contemplate a parallel situation in international law.

***

[214] Adherence to Article 36 of the Court's Statute by several States, provided for in that Article, was a long step towards what is called compulsory arbitration. This provision to some extent realized the hopes of several countries which wished the compulsory jurisdiction of the Court to be incorporated within the Statute itself. It was decided, however, that this general system was to be supplemented and completed by multilateral or bilateral agreements exactly defining the obligations of the parties. It was this purpose which inspired the recommendations of the Assembly of the League of Nations adopted on October 2nd, 1924, and September 25th, 1926, and, finally, the drafts of the General Act of conciliation, arbitration and judicial settlement and of the model conventions annexed thereto, voted by the Assembly of 1928.

[215] The question raised in the case now before the Court involves a legal problem of great importance to the proper understanding [p106] of the relations existing between the optional clause and the said conventions, and the Court's decision will certainly be very carefully examined by all the signatory States.

***

[216] On January 25th, 1938, the day on which the Belgian Application was filed with the Court, the Treaty of 1931 was still in force, and the provisions of that Treaty concerning judicial methods must determine the jurisdiction of the Court in this case.

[217] In my opinion, Belgium could not submit her Application, for as long as the said treaty was in force, without taking account of its provisions.

[218] Bulgaria, too, in her preliminary objection, was bound to discuss the jurisdiction of the Court in the light of the treaty provisions.

[219] The Bulgarian Government bases its objection to the jurisdiction of the Court on Article 3 of the said Treaty. The Belgian Government, both in its written memorials and in its oral pleadings, accepted the Bulgarian Government's objection as an objection to the jurisdiction of the Court, which it in fact is, since the said jurisdiction emanates from the text of the Treaty.

[220] The above-mentioned Article 3 lays down the following conditions in order that one of the Parties may object to the submission of an application to the Court:

1. If the dispute is one the occasion of which, according to the municipal law of one of the High Contracting Parties, falls within the competence of the judicial or administrative authorities of the objecting Party.
2. If the dispute has not been settled by means of a decision with final effect pronounced within a reasonable time by the competent authority.
3. If the applicant Party has not notified the other Party of its intention within a period of one year from the date of the aforementioned decision.

[221] The present dispute appears to me to fall within the competence of the Bulgarian judicial authorities for the following reasons.

[222] The Belgian Government recognized the jurisdiction of the Bulgarian courts in the Belgian Minister's letter to the Bulgarian Prime Minister dated April 22nd, 1937 (Bulgarian Memorial, No. 37).

[223] The Electricity Company of Sofia also recognized that jurisdiction, as is confirmed by the Belgian Minister in the afore [p107] said note, and also by the very fact of having instituted proceedings before the courts.

[224] The Agent for the Belgian Government acknowledged that jurisdiction both in the written memorials and in the oral pleadings. The Belgian Government's Additional Memorial contains this important statement : "Moreover, far from the Belgian Government having claimed to withdraw from the examination of the Bulgarian courts a dispute which fell legally within their jurisdiction, it is a fact that at the time when the Application was filed, two Bulgarian instances had delivered final judgments."

[225] According to universally admitted rules of international law, "property rights and contractual rights depend .... on municipal law .... and fall therefore more particularly within the jurisdiction of municipal tribunals". That is a quotation from the Court's last judgment (Panevezys-Saldutiskis Railway).

[226] The Court also laid down in that judgment that the question whether the courts of a country do or do not possess jurisdiction in a given case depends upon the law of that country and that on that matter only the said courts can give a final decision.

[227] There is no need to enter into the merits of this dispute in order to appreciate what is already evident, namely that the rights in question are contractual rights between the Municipality of Sofia and a Belgian electricity company.

[228] I also consider that Belgium filed her Application before the Bulgarian courts had delivered a final judgment, for these reasons.

[229] The judgment by the Court of Cassation might have quashed the judgment of the Court of Appeal and have referred the case for re-examination by two new courts.

[230] The Sofia Electricity Company lodged an appeal with the Court of Cassation for the very purpose of securing a fresh examination of the dispute by the Bulgarian courts.

[231] The Belgian Government's Memorial itself admits by implication that this appeal to the Court of Cassation was its last remedy (pp. 20 and 36 of the Belgian Memorial). The Belgian Memorial concludes as follows :

“May it please the Court, subject to any fuller submissions that may be made in the course of the proceedings,
A. To declare that the State of Bulgaria has failed in its international obligations,
1. ….
2. By reason of the above-mentioned judgments of the District Court and of the Court of Appeal of Sofia and of the judgment of the Court of Cassation given on March 16th, 1938...”. [p108]

[232] The argument whereby an appeal to a court of cassation does not prevent the application pf the local redress rule would, have as its result that the same dispute might be dealt with simultaneously by a municipal tribunal and an international court.

[233] As regards reasonable time-limits for the delivery of the final judgment by the national courts, the Belgian Government has made no observations and could not do so in its Application, because at the time when it was filed it was still not known when the Court of Cassation would deliver its judgment. For the rest, that judgment was given within less than nine months.

[234] The second part of Article 3 of the Treaty contains an undertaking by the State which proposes to submit an application to notify its intention within one year from the date of the above-mentioned decision. As there had been no decision with final effect, there could be no such notification. The notification contained in the note by the Belgian Legation in Sofia addressed to the Bulgarian Prime Minister and Minister for Foreign Affairs on June 24th, 1937, refers to the judgment delivered by the Sofia Court of Appeal on March 27th, 1937.

[235] With regard to paragraph 4 of Article 37 of the Treaty, I think that the words "proceedings pending at the expiration of the current period of the Treaty shall be duly completed" refer to proceedings validly instituted, that is to say that paragraph 4 of Article 37 refers to proceedings instituted in conformity with Article 3.

***

[236] The above considerations have led me to conclude that the preliminary objection to the Court's jurisdiction lodged by the Bulgarian Government and based on the Treaty of conciliation, arbitration and judicial settlement, concluded between Belgium and Bulgaria on June 23rd, 1931, is well-founded.

(Signed) Urrutia. [p109]

Dissenting Opinion by Jonkheer Van Eysinga.

[Translation]

[237] The Belgian Application relies on the Bulgarian and Belgian declarations of July 29th, 1921, and September 25th, 1925, accepting the jurisdiction of the Court under Article 36 of the Statute and also on the Treaty of conciliation, arbitration and judicial settlement of June 23rd, 1931.

[238] The adduction of these two sources of jurisdiction confronts the Court with the problem of concurrent sources of jurisdiction, a problem which became of practical importance more especially when the jurisdiction of the Court under Article 36 of the Statute was added to that of other tribunals provided for in already existing treaties. The importance of the problem was pointed out when the Court first entered upon its duties at the beginning of 1922 by van Vollenhoven in an article published in that year in the Rechtsgeleerd Magazijn and reproduced in the second volume of his Verspreide Geschriften (1934, pp. 559 et sqq.). Afterwards, the problem was further complicated by the conclusion of treaties of judicial settlement subsequent to acceptance of the Court's jurisdiction under Article 36 of the Statute and by the General Act of Geneva of September 26th, 1928. In these circumstances it is understandable that the problem should have attracted the attention of several other writers.

[239] In the present case it will suffice to examine the question what is the precise relation, as regards the Court's jurisdiction, between the Bulgarian and Belgian declarations under Article 36 of the Statute on the one hand, and the Treaty of 1931 on the other.

[240] As the question here concerns the foundation of the jurisdiction of the Court, it is for the latter to form its own opinion on the subject.

[241] The legal link resulting from acceptance of the Court's compulsory jurisdiction under Article 36 of the Statute came into existence on March 10th, 1926, when the Belgian declaration, which was some years later than the Bulgarian, came into force. By the operation of reciprocity, the only condition made in the Bulgarian declaration, the two conditions ratione temporis made in the Belgian declaration - the dispute must arise after March 10th, 1926, and in regard to situations or facts subsequent to that date - also hold good for Bulgaria. The same applies as regards the final condition made in the Belgian declaration : "except in cases where the Parties have agreed or shall agree to have recourse to another method of pacific settlement". [p110]

[242] After the changes in the system of pacific settlement of international disputes brought about by the activity of the League of Nations and particularly by the General Act of Geneva and the draft bilateral treaties attached to that Act, Bulgaria and Belgium made another effort with a view to the pacific settlement of any disputes between them by signing the Treaty of 1931 which came into force on February 4th, 1933. This Treaty in fact involves a very considerable extension of that which was provided for by the Belgian and Bulgarian declarations under Article 36 of the Court's Statute.

[243] Whereas the Bulgarian and Belgian declarations had in view the future legal disputes mentioned in Article 36 of the Statute, the Treaty of 1931 covers "All [future] disputes with regard to which the Parties are in conflict as to their respective rights" (Art. 4, para, 1), a conception which, according to paragraph 2 of this Article, covers more than the legal disputes mentioned in Article 36 of the Statute. And whereas the Belgian and Bulgarian declarations provided only for recourse to the Court, the Treaty of 1931 is more elastic and provides in Articles 5 to 7 three other methods for the pacific settlement of justiciable disputes: conciliation followed by arbitration, arbitration alone, and conciliation followed by a judicial settlement, while only if one of these three methods were not adopted would the Court alone decide the dispute.

[244] Moreover, the Treaty of 1931 is not restricted to the pacific settlement of legal disputes in the broad sense indicated in Article 4. The Treaty also provides for the pacific solution of "[future] disputes of every kind which may arise between the High Contracting Parties". In so far as such disputes are non-justiciable, they are all, without exception, to be referred to conciliation (Arts. 8-23) and if need be to arbitration (Arts. 24-31).

[245] The condition made in the Belgian declaration that a future dispute must arise "in regard to situations or facts subsequent to ratification of the declaration" has disappeared in the Treaty of 1931 ; on the other hand, recourse to diplomacy (Art. 1) and to the national administrative or judicial authorities (Art. 3) must be exhausted before the Parties can appeal to one of the procedures provided for in the Treaty; the two last conditions, which are new, are perfectly intelligible having regard to the very great extension of the system of pacific settlement of international disputes represented by the Treaty of 1931.

[246] It would seem already to follow, from the foregoing comparison between the Bulgarian and Belgian declarations and the articles of the Treaty of 1931, that the two countries, in concluding the Treaty, intended to develop very considerably the system for the pacific settlement of any disputes between them. And, with regard more particularly to justiciable disputes, the [p111] two countries not only extended the scope of this category of disputes but also modified the method for their pacific settlement.

[247] The new scope imparted by the two countries to the pacific settlement of any disputes between them is also apparent from the preamble to their Treaty of 1931. In this preamble, the two High Contracting Parties refer to "the recommendation of the Assembly of the League of Nations in its Resolution of September 26th, 1928, that all States should conclude conventions for the pacific settlement of international disputes", and they consider "that the faithful observance, under the auspices of the League of Nations, of methods of pacific settlement renders possible the settlement of all international disputes". It seems difficult to imagine that two States who, animated by this spirit, conclude a new agreement which carries much further the development of the system for the settlement of their disputes, should not have intended to apply the new agreement and the new agreement only so long as it remained in force.

[248] Moreover, the Belgian declaration of September 25th, 1925, which, as has been stated, also holds good for Bulgaria, explicitly provides for such a situation when it concludes with the words: "except in cases where the Parties have agreed or shall agree to have recourse to another method of pacific settlement". It follows from this conclusion of the Belgian declaration that that declaration is intended to be subsidiary; it is not to apply when and in so far as another method of pacific settlement has been established, and as has been explained above, the Treaty of 1931 does in fact establish another method of pacific settlement for the legal disputes contemplated by the Bulgarian and Belgian declarations.

[249] One is struck by the lack of consistency in the manner in which the problem of the simultaneous existence of different sources of the Court's jurisdiction has been envisaged on the Belgian side in this case.

[250] The letter of the Belgian Minister in Sofia of June 24th, 1937, in which it is proposed by Belgium that the dispute should be settled by the International Court, is based only on the Treaty of 1931. The letter only refers in parenthesis to the Bulgarian declaration of 1921 and not to the Belgian declaration which it would have been necessary to do - and not in parenthesis - if the Belgian Government had intended to found its proposal on the two declarations.

[251] On the other hand, the Belgian Application adduces both the declarations under Article 36 of the Statute and the Treaty of 1931. Both Belgium and Bulgaria proceed with their arguments on these lines but without clearly stating the problem of the concurrent sources of jurisdiction. The calm was broken when Counsel for the Belgian Government, on the morning of [p112] March 1st, said that the Treaty of 1931 alone should be applied during the period of its existence (Feb. 4th, 1933, to Feb. 4th, 1938) and that only before and after that period were the Bulgarian and Belgian declarations applicable - in other words, he reverted to the precise attitude of the Belgian letter of June 24th, 1937. In the afternoon the Belgian Counsel felt obliged to revert to the standpoint of the Belgian Application which, finally, was vigorously supported, without however convincing me, in the Bulgarian Agent's oral reply. It is however just possible that there may be a shade of difference between the standpoint of the Belgian Counsel and that of the Bulgarian Agent.

[252] This inconsistency in the Belgian attitude with regard to a problem which is fundamental in the present case is especially surprising because it has always been the practice of Belgium, in making the declaration of September 25th, 1925 - which was subsequently adopted by many other governments - as well as in adhering to the General Act and in signing a large number of treaties with or without the second condition ratione temporis (in regard to situations or facts subsequent to ratification) of the 1925 declaration, to be perfectly plain and precise.

[253] To try to apply at one and the same time two systems the second of which was adopted precisely in order to modify the first seems a difficult thing to do and one which must necessarily lead to results which in themselves show the inconsistency of such an attempt. I will point out one of these results. The second condition ratione temporis (in regard to situations or facts subsequent to ratification) of the Belgian declaration applies with regard to the legal disputes enumerated in Article 36 of the Statute. If one seeks to apply both the Belgian declaration and the Treaty of 1931, this condition remains applicable for the legal disputes of Article 36 of the Statute but is not so for the other legal disputes covered by Article 4 of the Treaty. Is it possible to imagine that the two countries intended this?

[254] It follows from the foregoing that the jurisdiction of the Court in this case, which began when the Treaty of 1931 was in force, must be envisaged solely in the light of that Treaty.

***

[255] The Belgian Application, setting aside point B, asks the Court to declare that Bulgaria has failed in her international obligations as the result of three distinct actions on the part of her administrative, judicial and legislative authorities. Bulgaria denies the alleged failure, and her chief argument is that the three actions in question fall solely within the domestic [p113] jurisdiction of Bulgaria and are therefore outside the jurisdiction of the Court, and the latter is asked by Bulgaria to give judgment to this effect. Besides this ground for the preliminary objection, Bulgaria puts forward three other grounds which are all included in her one objection to the jurisdiction. It is not easy to appreciate the precise intention of the Bulgarian Memorial which also speaks of the question of admissibility as well as that of jurisdiction. In this Note the Bulgarian Memorial is regarded as presenting a single preliminary objection to the jurisdiction which really consists of four objections, two of which are in the nature of objections to the admissibility of the Application.

***

[256] In the first place, Bulgaria objects that the Belgo-Bulgarian dispute has not arisen in regard to situations or facts subsequent to March 10th, 1926, and that consequently the Court has no jurisdiction. Since this objection is based on the text of the Belgian declaration of September 25th, 1925, and not on the Treaty of 1931, which does not contain this condition ratione temporis, the Court cannot entertain it.

***

[257] Secondly, Bulgaria - this time on the basis of the Treaty of 1931 - adduces the non-exhaustion of local remedies, to the exhaustion of which Article 3 of the Treaty of 1931 subordinates the institution of proceedings. Here again the Bulgarian Memorial speaks of lack of jurisdiction, since if the Court accepted the Bulgarian argument, Belgium would not be in a position to return to the Court on the basis of the Treaty of 1931 which ceased to be effective on February 4th, 1938. But since Belgium would in that case be entitled to bring a suit on the basis of the Bulgarian and Belgian declarations of 1921 and 1925, this is an objection as to the admissibility of the application and it has been so described more than once by the Bulgarian representative.

[258] It is common ground that the subject of the dispute between the two States, in so far as A, Nos. 1 and 2, of the Belgian Application is concerned, is the same as the subject of the dispute between the Belgian Company and the Municipality of Sofia, and that, accordingly, Article 3 of the Treaty of 1931 applies. It is also common ground that on March 27th, 1937, the Bulgarian courts had adjudicated in first instance and on appeal and that the Bulgarian Prime Minister, on August 3rd, 1937, stated that the Bulgarian courts had already had occasion to give their decision. But it is also true that the Belgian [p114] Company on June 23rd, 1937, appealed to the Court of Cassation and that the Belgian Government's Application was filed with the Court on January 26th, 1938, that is to say before the Court of Cassation had adjudicated, which it did on March 16th, 1938, rejecting the appeal in its entirety.

[259] On behalf of Belgium it has been said that the expression "decision with final effect" in Article 3 of the Treaty of 1931 does not cover the exceptional case of an appeal in cassation. In this connection it may however be asked why the Belgian Company defends its rights so energetically: for the very reason that it considers them to have been infringed. And why does the Treaty of 1931, like so many other treaties of the same kind, stipulate in Article 3 the condition respecting exhaustion of local remedies? Because the contracting Parties did not intend that an international court should adjudicate before the municipal courts had had an opportunity of redressing the alleged breach of the law. In that case it does not seem to be possible to exclude from these municipal courts the Court of Cassation whose sole or in any case main task is precisely to ensure that the law has not been violated.

[260] Accordingly, the final decision of the Bulgarian municipal courts had not been given when the Belgian Application was filed. It was given some weeks later, on March 16th, 1938. What would now be the situation if the Court had upheld the Bulgarian objection as to admissibility ? The Belgian Government might then at once re-submit its Application on the basis of the declarations under Article 36 of the Statute, since by then the remedies of Bulgarian municipal law would have been exhausted more than a year previously. In these circumstances it seems that it would be a pure formality to uphold the objection based on the local remedies rule, at a moment when these remedies have long been exhausted, and on the ground that at an earlier moment they had not yet been exhausted.

[261] It has been said that nevertheless, as long ago as August 3rd, 1937, the Bulgarian Government opposed the submission of the dispute to the Court until a final decision had been rendered by the Bulgarian courts. Is that true? What the letter of the Bulgarian Prime Minister of August 3rd, 1937, says is that the Bulgarian courts have exclusive jurisdiction. Bulgaria does not want the Hague Court either before or after the exhaustion of local remedies. But since Belgium had said that she intended to refer the case to the Court under the Treaty of 1931, Bulgaria replies by adducing Article 3 of that Treaty -which she immediately afterwards denounced - but she does so in terms which leave no doubt that she does not oppose the submission of the case to the Hague Court before the remedies afforded by the local courts have been exhausted - which indeed [p115] had already given their decision according to the letter itself -but the submission of the case to the Court at all. Accordingly, the special agreement proposed by Belgium was out of the question. That, it seems to me, is the meaning of the Bulgarian letter of August 3rd, 1937.

[262] It follows from the foregoing that the objection consisting in the non-exhaustion of local remedies should not be accepted by the Court.

***

[263] Bulgaria objects in the third place that the Belgian Application cannot be entertained in so far as it asks the Court to say that the State of Bulgaria has failed in its international obligations by the promulgation of the law of February 3rd, 1936, of which Article 30, paragraph C, establishes a special tax on the distribution of electric power purchased from undertakings not subject to tax.

[264] The law of 1936 remained outside the scope of the disputes upon which the Court of Cassation adjudicated as the ultimate Bulgarian court of appeal, and the Belgian Government was informed of the grievance arising out of this law only after the failure of its intervention in regard to the decisions rendered by the Bulgarian courts.

[265] The Bulgarian Memorial gives two reasons why the Belgian Application is, in its contention, inadmissible in so far as concerns the law of 1936.

[266] In the first place this Belgian claim, it is said, never formed the subject of efforts to reach a settlement through diplomatic channels as provided in Article 1 of the Treaty of 1931 upon which the Belgian Government founds the jurisdiction of the Court. On this point the Belgian attitude is not quite consistent and it is to be supposed that there are reasons why, on the Belgian side, it was preferred not to produce proof that diplomatic methods had in fact been exhausted. However that may be, the Belgian Agent, at the hearing on March 1st, 1939, concluded by saying that he was in a position to produce proof that diplomatic negotiations had been unsuccessfully tried. Accordingly the Belgian Agent definitely offered to produce proof but left the Court to decide whether he should do so or not. In these circumstances it seems difficult to draw any conclusion detrimental to Belgium from the non-presentation of the proof offered.

[267] In the second place, according to the Bulgarian Memorial, the Belgian Company had not had recourse to any local means of redress with regard to the claim respecting the law of 1936. The Bulgarian Memorial says on this subject that there was not even a dispute in the legal sense, so that Belgium did not observe Article 3 of the Treaty of 1931 which requires not [p116] only that there must be a dispute falling within the competence of the Bulgarian judicial or administrative authorities but also that there must be a decision with final effect given by these authorities, in order to give rise to a dispute between the two States under the Treaty of 1931.

[268] In this connection it should be observed that it has not been established that there exist any judicial or administrative authorities, within the meaning of Article 3 of the Treaty of 1931, to which the Belgian Company could have had recourse with a view to securing the modification of the law of 1936. Apart from this however the dispute in this case is not one in which Belgium has taken up the claim of its national against the Bulgarian authorities, but a dispute in which Belgium directly impugnes a legislative act of the State of Bulgaria. And, to use terms borrowed from the Court's jurisprudence, a dispute, a disagreement or a divergence of opinions on a point of law or of fact - a contradiction or opposition of legal views or interests - exists as soon as one of the governments concerned states that the attitude adopted by the other government conflicts with its own views. (Judgment No. 2 in the Mavrommatis case, p. 11 ; Judgment No. 6 in the case concerning certain German interests in Upper Silesia, p. 14.)

[269] It has been said that Bulgaria objects that the Belgian Government's claim respecting the law of 1936 is inadmissible on the ground that the claim did not form the subject of a dispute between the Governments and prior to the filing of the Belgian Application. Apart from the fact that this question could only have been cleared up if the Belgian Agent had produced the proof which he had offered regarding the exhaustion of diplomatic methods, it should be observed that, as appears from what has already been said, the Bulgarian Government did not raise this objection in its Memorial. In their oral statements, the Bulgarian Agent and Counsel also adduced a number of arguments in addition to the two arguments contained in the Bulgarian Memorial, but it is unnecessary here to dwell on these additional arguments which include the argument which dominates the whole attitude taken up by Bulgaria in this case and which will be dealt with at the end of this Note, namely that legislative acts fall within the exclusive jurisdiction of Bulgaria. But the argument that there was no dispute between the two Governments before the filing of the Belgian Application is not to be found in the additional arguments any more than in the Bulgarian Memorial. [p117]

***

[270] I now come to the fundamental preliminary objection to the jurisdiction raised by Bulgaria: namely, that the impugned actions of the administrative, judicial and legislative authorities all fall within the exclusive jurisdiction of Bulgaria.

[271] With regard to this aspect of the allegation of lack of jurisdiction, the following observations are called for.

[272] The subject of the dispute is stated in the Application and consists in an alleged failure by Bulgaria to fulfil her international obligations. In the dispute the two Parties are in conflict as to their respective rights : the alleged failure to fulfil international obligations, on the one hand, and alleged exclusive jurisdiction, on the other. Accordingly, the dispute comes under Article 4 of the Treaty of 1931.

[273] Bulgaria recognizes the jurisdiction of the Court to declare that the impugned actions of the administrative, judicial and legislative authorities all fall exclusively within the domestic jurisdiction of Bulgaria. She even insists upon it when she asks the Court to declare that it has no jurisdiction to entertain the Belgian Application. A decision to the effect that the actions of the administrative, judicial and legislative authorities complained of all fall within the domestic jurisdiction of Bulgaria would require that the Court should undertake the same investigation as that asked for in the first place by the Belgian Application when it asks the Court to declare that the State of Bulgaria in consequence of these actions has failed in her international obligations. For, before it could adjudicate on the question whether Bulgaria has failed in all or some of her international obligations contemplated in the Belgian Application, the Court would have to decide if Bulgaria had any international obligations in relation to the acts complained of or whether, on the contrary, these acts fall solely within the domestic jurisdiction of Bulgaria. It follows that an examination of Bulgaria's fundamental preliminary objection to the jurisdiction would entail an examination of the merits and that, consequently, this objection does not possess the nature of a preliminary objection and must be rejected, though Bulgaria could take it up again as a plea in defence.

***

[274] The foregoing observations point to the rejection of the four preliminary objections, while at the present stage of the proceedings the Court is not called upon to adjudicate on paragraph 2 of the Bulgarian submissions.

(Signed) V. Eysinga. [p118]

Dissenting Opinion of Mr. Hudson.

[275] The Bulgarian Government has advanced a preliminary objection in this case, asking the Court to declare that it lacks jurisdiction to deal with the application filed by the Belgian Government on January 26th, 1938, and to dismiss the Belgian claims. This challenge to the Court's jurisdiction requires that attention be given, at the outset, to the possible sources of jurisdiction, and to the bases upon which Belgium asserts and Bulgaria contests jurisdiction to deal with this case. If two States parties to a case before the Court agree that the Court has jurisdiction, it will usually be unnecessary for the Court to look further for confirmation of its jurisdiction; but where, as here, the jurisdiction is contested, the Court must look for a source of its jurisdiction in the applicable law in spite of the fact that the parties may trace their contentions to the same source or sources.

***

[276] In the diplomatic correspondence which preceded the filing of the Belgian Application, the Belgian-Bulgarian Treaty of conciliation, arbitration and judicial settlement of June 23rd, 1931, was put forward by the Belgian Minister at Sofia as the sole source of the jurisdiction to be invoked. In a letter addressed to the Bulgarian Minister for Foreign Affairs on June 24th, 1937, the Belgian Minister proposed the conclusion of a compromis for submitting the dispute to the Court, stating that it fell within the class of disputes which the provisions of Articles 4 to 6 of the Treaty of 1931 permitted to be taken to the Court by unilateral application unless agreement was reached for submitting them to arbitration; reference was made parenthetically only to the declaration by which in 1921 Bulgaria had recognized the obligatory jurisdiction of the Court, but no mention was made of the declaration by which Belgium had recognized the Court's obligatory jurisdiction and no indication was given of any desire on the part of the Belgian Government to avail itself of the reciprocal declarations of Belgium and Bulgaria. On July 30th, 1937, the Belgian Minister informed the Bulgarian Minister for Foreign Affairs that as the Belgian Government saw no possibility of an agreement between the two Governments for submitting the dispute to arbitration in accordance with the provisions of the Treaty of 1931, the dispute would be put before the Court by the [p119] unilateral application of the Belgian Government. In his reply of August 3rd, 1937, the Minister for Foreign Affairs referred to the Belgian Government's intention to go before the Court by unilateral application based on the Treaty of 1931, and he gave notice of the Bulgarian Government's intention to avail itself of the privilege accorded by Article 3 of that Treaty.

[277] These were the communications exchanged by the Parties prior to the filing of the Belgian Application. They gave no indication that any source of the Court's jurisdiction was to be relied upon other than the Treaty of 1931. References by the Parties to the sources of the Court's jurisdiction may now be traced through the documents of the written proceedings.

[278] The Belgian Application filed with the Registry of the Court on January 26th, 1938, referred to two sources of jurisdiction:

(1) the declarations of adherence made by Belgium and Bulgaria to the Optional Clause accepting as compulsory the jurisdiction of the Court, which declarations were respectively ratified on March 10th, 1926, and August 12th, 1921;
(2) the Treaty of conciliation, arbitration and judicial settlement concluded between the two countries on June 23rd, 1931.

[279] The Memorial presented by the Belgian Government contained (pp. 18-19) a section entitled "La compétence de la Cour", in which it was said that the Belgian Government found a justification of the Court's jurisdiction in the Treaty of 1931, and Articles 4 and 37 of the Treaty were set out in extenso; the Memorial proceeded to state that surabondamment the Belgian Government based the Court's jurisdiction on the "declarations of adherence of Belgium and of Bulgaria to the Optional Clause", but the texts of these declarations were not set forth. In the additional Memorial subsequently submitted by the Belgian Government, it was said (p. 9) that the Treaty of 1931 had been indicated in the Memorial as a basis of jurisdiction en deuxième lieu; and reference was made (p. 15) au fondement de compétence de la Cour que surabondament la Partie demanderesse croit trouver dans le Trailé de 1931.

[280] On its side, the Bulgarian Government expressed the view (Bulgarian Memorial, p. 8) that the Belgian contentions as to the Court's jurisdiction were justified neither on the basis of the declarations cited nor on the basis of the Treaty of 1931.

[281] It was only in the oral proceedings that reference was made to the relation existing between the Treaty of 1931 and the earlier declarations, as possible sources of the Court's jurisdiction to deal with this case. Though the Belgian Agent had contended that chacun de ces deux actes suffit en réalité à lui seul pour étayer nos revendications, M. Rolin, Counsel for the Belgian Government, expressed the view (Exposés oraux, [p120] pp. 49-50) that it would be absurd to imagine that it had been intended by the Belgian and the Bulgarian Governments in 1931 to create an additional system to be in force cumulatively with the Optional Clause by which the two States were already bound; and that, during the period when it was in force, the Treaty of 1931 prevailed over the Optional Clause. Hence he concluded that the legal relations between Belgium and Bulgaria were governed as follows: until February 3rd, 1933, by the Optional Clause: from February 3rd, 1933 — date of the entry into force of the Treaty of 1931 [FN1] — to February 3rd, 1938, by the Treaty; and since February 3rd, 1938, by the Optional Clause. Later in the course of his expose, however, M. Rolin stated (p. 56) that reflection had led him to question the correctness of his earlier statement; with the result that, after reflection, he considered that in the period during which the Treaty was in force the Court could take the Optional Clause into consideration dans la mesure où elle n'est pas modifiée par les amendements qu'éventuellement y a apportés le Traité entre la Belgique et la Bulgarie.

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[FN1] The exchange of ratifications of the Treaty of 1931 took place not on February 3rd, but on February 4th, 1933.
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[282] In reply to M. Rolin's statement, the Bulgarian Agent gave (pp. 74-75) various reasons for the Bulgarian view that the Treaty of 1931 did not suspend the functioning of the Optional Clause; he contended that, with respect to the obligation of judicial settlement, the Treaty of 1931 left intact the pre-existing legal situation, and that the dispositions in the Treaty concerning judicial settlement served only the purpose of a reference to the pre-existing situation, without effecting any modification in that situation.

[283] On this presentation of the problem as to the source or sources of the Court's jurisdiction, it is necessary to consider in some detail the legal obligations of Belgium and Bulgaria inter se with reference to the jurisdiction of the Court, as they existed on January 26th, 1938, the date when the Belgian Application was filed.

*

[284] On August 12th, 1921, the Bulgarian Government deposited at Geneva a ratification of a declaration made on July 29th, 1921, in connection with Bulgaria's signature of the Optional Clause, the text of which was as follows: [p121]

"On behalf of the Government of the Kingdom of Bulgaria I recognize, in relation to any other Member or State which accepts the same obligation, the jurisdiction of the Court as compulsory ipso facto and without any special convention, unconditionally. "

[285] On September 25th, 1925, the Optional Clause was signed on behalf of Belgium, with the following declaration:

"On behalf of the Belgian Government, I recognize as compulsory, ipso facto and without special agreement, in relation to any other Member or State accepting the same obligation, the jurisdiction of the Court in conformity with Article 36, paragraph 2, of the Statute of the Court for a period of fifteen years, in any disputes arising after the ratification of the present declaration with regard to situations or facts subsequent to this ratification, except in cases where the Parties have agreed or shall agree to have recourse to another method of pacific settlement. "

[286] A ratification of the Belgian declaration was deposited at Geneva on March 10th, 1926. After this date, therefore, Belgium and Bulgaria were bound inter se to recognize the Court's jurisdiction with respect to the disputes enumerated in Article 36, paragraph 2, of the Statute, with the two exceptions established by the Belgian declaration, i. e., excepting (1) disputes arising before March 10th, 1926, and (2) disputes with regard to situations or facts prior to March 10th, 1926. The obligation of the two States was not applicable, however, in cases where the Parties had agreed or might agree to have recourse to another method of pacific settlement.

*

[287] On June 23rd, 1931, representatives of Belgium and Bulgaria signed a Treaty of conciliation, arbitration and judicial settlement, so entitled; ratifications of this Treaty were exchanged on February 4th, 1933 [FN1]. On that date, in accordance with the provisions in Article 37 (2), the Treaty entered into force for a period of five years, expiring on February 4th, 1938. On August 3rd, 1938, six months before the expiration of the five-year period and in accordance with the provisions in Article 37 (3), the Treaty was "denounced" by Bulgaria; hence it did not continue in force for an additional period of five years after February 4th, 1938.

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[FN1] The Treaty was registered with the Secretariat of the League of Nations, No. 3156, on March 3rd, 1933. 137 League of Nations Treaty Series, p. 191.
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[288] The Treaty provides (Art. 1) that disputes of every kind which may arise between the Parties and which it may not have been possible to settle by diplomacy shall be submitted [p122] to judicial settlement or arbitration, preceded either obligatorily or optionally by a procedure of conciliation. Disputes "with regard to which the Parties are in conflict as to their respective rights" — it is expressly stated that these disputes include those mentioned in Article 36 of the Court's Statute — are to be submitted to the Court (Art. 4) unless the Parties agree upon resort to an arbitral tribunal. Provision is made for the procedure of arbitration of such disputes if the Parties agree on arbitration, and also for a procedure of conciliation of such disputes if the Parties agree on conciliation. As to disputes other than those "with regard to which the Parties are in conflict as to their respective rights", a procedure of conciliation is made obligatory (Art. 8), elaborate provision being made for the conduct of this procedure; and if the conciliation does not lead to an agreement between the Parties, arbitration then becomes obligatory for these disputes (Art. 24), provision being made for constituting the arbitral tribunal and for the procedure to be followed.

[289] Comparing the Treaty of 1931, in so far as it relates to judicial settlement, with the reciprocal declarations made by Belgium and Bulgaria under Article 36, paragraph 2, of the Statute, it will be seen that the Treaty provision for judicial settlement by the Court applies to all the legal disputes which would be covered by the declarations, and it may go further in that it applies to all disputes with regard to which the Parties are in conflict as to their respective rights. The Treaty is also more extensive in that it does not exclude disputes with regard to situations or facts anterior to March 10th, 1926. On the other hand, the Treaty contains two conditions not set by the reciprocal declarations; under Article 1 of the Treaty, the dispute must be one "which it may not have been possible to settle by diplomacy"; and under Article 3 of the Treaty, if the dispute is one of which the subject (Fr. objet) according to the law of one of the Parties falls within the competence of its judicial or administrative authorities, that Party may object to the dispute's being submitted for settlement by a method laid down in the Treaty until a definitive decision has been pronounced within a reasonable time by the competent authority. One other difference is to be noted: while the Bulgarian declaration of 1921 was not limited to any period of time, the Belgian declaration was limited to a period of fifteen years expiring on March 10th, 1941; the Treaty on the other hand was concluded for successive five-year periods, and as events turned out it ceased to be in force at the end of the first period of five years, i. e., on February 4th, 1938. [p123]

*

[290] This being the situation, the Court must say what law obtained between Bulgaria and Belgium on January 26th, 1938, the date of the filing of the Belgian Application. The fact that the Treaty of 1931 ceased to be in force some nine days later can have no bearing on the Court's jurisdiction with respect to this case. If the jurisdiction existed on January 26th, 1938, it will continue until the case is disposed of in due course; this is expressly recognized, indeed, in Article 37 (4) of the Treaty.

[291] On January 26th, 1938, then, were the provisions of the Treaty of 1931 operative ? Were the reciprocal declarations made by Belgium and Bulgaria under Article 36, paragraph 2, of the Statute, also operative ? And if the latter question be answered in the affirmative, do the reciprocal declarations and the Treaty constitute independent ways of access to the Court ? Or are their provisions in some way cumulative, so as to require that the conditions of both must be met before the Court's jurisdiction can be invoked ? These questions will have to be considered, however, only if both the reciprocal declarations and the Treaty of 1931 are found to be applicable, in their terms, to this case.

[292] The jurisdiction conferred on the Court by the Belgian declaration is in terms not applicable "in cases where the Parties have agreed or shall agree to have recourse to another method [Fr. mode] of pacific settlement". The first question is whether this is such a case, whether the Treaty of 1931 constitutes, for cases falling under Article 36, paragraph 2, of the Statute, "another method of pacific settlement" upon which the Parties have agreed.

[293] Article 4 of the Treaty of 1931 requires recourse to the Court "unless the Parties agree, in the manner hereinafter provided, to have resort to an arbitral tribunal"; and Article 5 provides for giving effect to such an agreement for arbitration. Under Article 7 of the Treaty, before any resort to the Court or to an arbitral tribunal, "the Parties may agree to have recourse to the conciliation procedure provided for in the present Treaty". Hence it would seem that for the legal disputes which are covered by Article 36, paragraph 2, of the Statute and to which the reciprocal declarations of Belgium and Bulgaria apply, the Treaty provides not a system of judicial settlement alone, but a system of conciliation, arbitration and judicial settlement, all three of which are in a sense bound together. Disputes for which the declarations provide a settlement by the Court may under the Treaty be referred to the Court, [p124] or to arbitration, or to conciliation followed (if necessary) by the Court's adjudication, or to conciliation followed (if necessary) by arbitration. The system of the Treaty is then different from the system of the declarations, though the judicial settlement (as distinguished from arbitration) is in both systems confided to the Court. It may be said, however, that under the Treaty an agreement between the Parties is necessary before conciliation or arbitration can be substituted for or placed before judicial settlement, and that even under the declarations it was open to the Parties to agree upon the conciliation or the arbitration of a dispute as an alternative to judicial settlement. Yet the system of the Treaty is in this respect different from that of the reciprocal declarations, because the Treaty provides in terms for the alternative and lays down the lines which the alternative is to follow.

[294] The two systems being different, it would seem that this is a case in which the Parties have agreed, in the terms of the Belgian declaration, "to have recourse to another method of pacific settlement". If this conclusion be sound, the reciprocal declarations by Belgium and Bulgaria are not to be applied as a source of jurisdiction in this case, and the Court's jurisdiction may be sought only in the Treaty of 1931.

[295] Note may here be made of Article 2 of the Treaty of 1931 which provides that "disputes for the settlement of which a special procedure is laid down in other conventions in force" between the Parties "shall be settled in conformity with the provisions of such conventions". It is not a simple matter to give a precise meaning to this provision [FN1]; but it would seem quite clear that the Belgian and Bulgarian declarations are not in this sense a convention laying down "a special procedure" for the settlement of the legal disputes covered by Article 36, paragraph 2, of the Statute.

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[FN1] See the strictures on this provision by "Gallus" (a pseudonym), in 57 Revue de Droit international et de Législation comparée (1930), p. 879.
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*

[296] If it should be thought that the Treaty of 1931 does not provide for "another method of pacific settlement" within the meaning of the concluding phrase of the Belgian declaration, the Court would then have before it two texts — the reciprocal •declarations of Belgium and Bulgaria on the one hand, and the Treaty of 1931 on the other hand — dealing with the same [p125] general subject-matter. In such a situation the relation between the two texts cannot be disregarded.

[297] Each of the texts is a statement of the Parties' intention to confer jurisdiction on the Court, but the jurisdiction is not the same in each case. In consequence of the reserve in the Belgian declaration, the reciprocal declarations had the effect of confining the Court's obligatory jurisdiction to disputes with regard to situations or facts posterior to March 10th, 1926; the text of the Treaty, on the other hand, is quite opposed to this limitation. Article 4 of the Treaty gives the Court jurisdiction over "all disputes with regard to which the Parties are in conflict as to their respective rights"; these are expressly said to include the disputes "mentioned in Article 36 of the -Statute", to some of which the reciprocal declarations apply, and the Treaty does not exclude disputes with regard to situations or facts anterior to any particular date. Clearly, therefore, the Treaty's provision for the Court's jurisdiction is inconsistent with that of the reciprocal declarations, and in this case the two sources cannot be drawn upon simultaneously.

[298] Called upon to choose which of the two texts is to govern in this case, the Court must apply a general principle of law, and it must say that the expression of the Parties' intention which is the later in point of time should prevail over that which is the earlier. The Parties had it in their power to enlarge their legal obligations resulting from the declarations, and this they did by the Treaty of 1931 which confers on the Court a more extensive jurisdiction than that conferred by the declarations. Moreover, the Treaty is an instrument which was drawn up to apply specially to the relations of Belgium and Bulgaria; the declarations were not drawn up with reference to the relations of Belgium and Bulgaria alone, each declaration being made by one of these States with reference to its relations with all other States recognizing the Court's jurisdiction as provided for in Article 36, paragraph 2, of the Statute. Whereas the declarations were of possible and actual interest to many States, the Treaty, though it followed a standard model, concerned only the two signatory States. If it is to be said that the special prevails over the general instrument, or that the more extensive prevails over the less extensive provision, the result here will coincide with the application of the rule that a later will prevail over an earlier text [FN1]. [p126]

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[FN1] On this point, see the discussion by "Gallus" in 8 Revue de Droit international (1931), pp. 392-395
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*

[299] If confirmation is desired of the Parties' intentions that the Treaty should confer on the Court a jurisdiction more extensive than that conferred by the reciprocal declarations and not limited to disputes with regard to situations or facts posterior to March 10th, 1926, it can be found in what may be referred to as the pre-natal history of the Treaty of 1931. Though a reference to this history was made by the Bulgarian Agent, neither of the Parties endeavoured to place the whole record before the Court. The preamble to the Treaty of 1931 recalls a recommendation made by the Assembly of the League of Nations in a resolution of September 26th, 1928; this in itself is a basis for summoning the aid of the Treaty's history.

[300] In 1927, the Eighth Assembly of the League of Nations, "anxious to bring about the political conditions calculated to assure the success of the work of disarmament", recommended "the progressive extension of arbitration by means of special or collective agreements". To this end, it asked the Council to instruct the Preparatory Disarmament Commission to create a committee to consider measures which might be taken "with a view to promoting, generalizing, and coordinating special or collective agreements on arbitration and security" [FN1]. As a result of this resolution, a Committee on Arbitration and Security was created, to which the Swedish Government suggested the idea of a collective agreement based on the Locarno treaties; this Committee prepared various drafts of conventions on pacific settlement, all of which were faithful to the Locarno formulœ in that they contained provisions for excluding from the Court's jurisdiction disputes concerning anterior facts [FN2]. The work of the Committee on Arbitration and Security led to the adoption by the Ninth Assembly of the resolution of September 26th, 1928 [FN3], to which reference is made in the preamble of the Belgian-Bulgarian Treaty of June 23rd, 1931. This resolution invited States to accept obligations concerning pacific settlement "either by becoming parties to the annexed General Act, or by concluding particular conventions with individual States in accordance with the model bilateral conventions annexed hereto". To the resolution were annexed a draft General Act and drafts of three model bilateral conventions, "Convention a", "Convention b", and "Convention c". The annexed General Act contained in Article 39 provision for possible reservations which would "exclude from the procedure" provided for, "disputes arising out [p127] of facts prior" to accession to the Act. The annexed model bilateral "Convention a" contained, between Article 34 and Article 35, the word "Article1"; no number was assigned to this "article" and no text was given, but the footnote to which the figure "1" referred suggested that "States desiring to introduce reservations might insert here an article based on Article 39 of the General Act.... "2. Similar provisions were included in models "b" and "c". Thus, the text of the draft General Act provided expressly for possible reservations excluding disputes arising out of anterior facts, and the texts of the model bilateral conventions carried an unnumbered blank article referring to a footnote which called attention to the possibility of the same reservation.

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[FN1] Records of Eighth Assembly, Plenary, pp. 177-178
[FN2] League of Nations Document, C. 358. M. 112. 1928. IX
[FN3] Records of Ninth Assembly, Plenary, p. 182.

[FN1] League of Nations Document, C. 358. M. 112. 1928. IX
[FN2] This note is to be found with the text of "Convention a" as published in League of Nations Document C. 536. M. 163. 1928. IX; in Records of Ninth Assembly, Plenary, p. 502; and in League of Nations Official Journal. Special Supplement No. 63, p. 31.
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"Convention a", as annnexed to the Assembly resolution of September 26th, 1928, served as the model of the Belgian-Bulgarian Treaty of June 23rd, 1931; in general the text of the Treaty follows almost verbatim that of the draft. Two significant departures are to be noted, however:
(1) The suggestion in the unnumbered, blank article placed between Article 34 and Article 35 of the draft was completely rejected when the Treaty was drafted. For the text of the Treaty contains no reference to the exclusion of disputes with regard to anterior facts, and neither in signing nor in ratifying the Treaty did the Parties make any such reservation. This would seem to be a clear indication of the Parties' intention that disputes with regard to anterior facts should not be excluded from the jurisdiction conferred on the Court by the Treaty of 1931.

[301] (2) Article 2 of "Convention a", following Article 29 of the General Act, contains these provisions:

"1. Disputes for the settlement of which a special procedure is laid down in other conventions in force between the Parties shall be settled in conformity with the provisions of those conventions.
2. The present Convention shall not affect any agreements in force by which conciliation procedure is established between the High Contracting Parties or they are bound by obligations to resort to arbitration or judicial settlement which ensure the settlement of the dispute. If, however, these agreements provide only for a procedure of conciliation, after such procedure has been followed without result, the provisions of the present Convention concerning judicial settlement or arbitration shall be applied. "[p128]

[302] The text of Article 2 of the Treaty of 1931 is quite different, running as follows:

"Disputes for the settlement of which a special procedure is laid down in other conventions in force between the High Contracting Parties shall be settled in conformity with the provisions of such conventions. Nevertheless, should the settlement of the dispute not be achieved by application of this procedure, the provisions of the present Treaty concerning arbitration or judicial settlement shall be applied. "

[303] The Treaty of 1931 thus fails to include the provision in paragraph 2 of Article 2 of the model adopted by the Assembly, which was designed to continue the operation of prior obligations, such as those of reciprocal declarations under Article 36, paragraph 2, of the Statute. This is another indication of the Parties' intention that Article 4 of the Treaty of 1931 was to free them of the limitations established by the reciprocal declarations, so long as the Treaty should remain in force.

*

[304] Further indication of the Parties' intentions as to the scope of the Treaty of 1931 may be sought in the general policy followed by each of the two signatory States in entering into treaties with other States.

[305] Bulgaria's general policy is quite consistently that indicated in the Bulgarian declaration of 1921. Though Bulgaria did not accede to the General Act of 1928, it entered into a number of treaties which follow the model drafts adopted by the Assembly in 1928: with Turkey, March 6th, 1929 [FN1]; with Hungary, July 22nd, 1929 [FN2] ; with Poland, December 31st, 1929[FN3] ; with Spain, June 26th, 1931 [FN4] with Norway, November 26th, 1931[FN5] ; with Denmark, December 7th, 1935 [FN6] ; and with Latvia, May 23rd, 1933. Of these treaties only that with Poland excluded disputes with regard to anterior situations or facts [FN7].

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[FN1] 114 League of Nations Treaty Series, p. 399.
[FN2] 101 idem, p. 41.
[FN3] 113 idem, p. 89.
[FN4] 166 idem, p. 341.
[FN5] 134 idem, p. 27.
[FN6] 182 idem, p. 183.
[FN7] Bulgaria's treaties with the United States of America, of January 21st, 1929 (93 idem, pp. 331, 337), and its treaty with Mexico, of November 5th, 1936 (187 idem, p. 37), follow special forms.
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[306] Belgium seems for a time to have assigned great importance to the exclusion of disputes with regard to anterior situations or facts. Soon after the signature of its declaration of September 25th, 1925, Belgium entered into a treaty with [p129] Germany, initialled at Locarno on October 16th, 1925 [FN1], which (Art. 1) did not apply to "disputes arising out of events prior to the present Convention and belonging to the past". Then followed treaties with Sweden, April 30th, 1926 [FN2]; with Switzerland, February 5th, 1927 [FN3]; with Denmark, March 3rd, 1927 [FN4]; with Finland, March 4th, 1927 [FN5]; with Portugal, July 9th, 1927 [FN6]; and with Poland, October 25th, 1928 [FN7] - all of which expressly excluded either disputes with regard to anterior situations or facts, or disputes arising out of prior events. A treaty with Spain, July 19th, 1927 , did not contain the exclusion, but the final protocol gave a reason for this, viz., that no dispute was then pending between the two States. A treaty with Luxemburg, October 17th, 1927 , on the other hand, provided (Art. 1) for its application to the disputes for the solution of which a method of pacific settlement had been provided by the Economic Convention between the two countries, even when such disputes referred to facts prior to the conclusion of the treaty.

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[FN1] 54 League of Nations Treaty Series, p. 303.
[FN2] 67 idem, p. 91.
[FN3] 68 idem, p. 45.
[FN4] 67 idem, p. 117.
[FN5] 69 idem, p. 361.
[FN6] 74 idem, p. 39.
[FN7] Publications of the Court, Series D, No. 6, p. 308.
[FN8] 80 League of Nations Treaty Series, p. 17.
[FN9] 124 idem, p. 203.
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[307] Following the Assembly's adoption of its resolution of September 26th, 1928, Belgium acceded to the General Act on May 18th, 1929, with a reservation as to disputes arising out of anterior facts [FN10]; but thereafter some change is noticeable in Belgian policy. Belgium's treaties with Czechoslovakia, April 23rd, 1929 [FN11] ; with Greece, June 25th, 1929 [FN12] ; with Lithuania, September 24th, 1930 [FN13] ; and with Bulgaria, June 23rd, 1931, followed the Assembly's model "Convention a", and none of them referred to the exclusion of disputes with regard to anterior situations or facts. A treaty with Yugoslavia, March 25th, 1930 [FN14] , did not apply to "disputes which arose prior to the conclusion of the present Convention" ("différends nés antérieurement à la conclusion de la présente Convention"); while treaties with Roumania, July 8th, 1930 [FN15] , with Turkey, April 18th, 1931 [FN16] , and with Venezuela, August 14th, 1935 [FN17], did not apply [p130] to disputes arising out of anterior facts and belonging to the past [FN1].

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[FN10] 93 idem, p. 344.
[FN11] 110 idem, p. 113.
[FN12] 113 idem, p. 117.
[FN13] 129 idem, p. 399.
[FN14] 106 idem, p. 343.
[FN15] 128 idem, p. 403.
[FN16] Publications of the Court, Series D, No. 6, p. 475.
[FN17] Documents parlementaires (Belgique), 1935-1936, No. 75.
[FN1] Belgium's treaties with the United States of America of March 20th, 1929 (109 League of Nations Treaty Series, pp. 261, 267), and its treaty with Persia of May 26th, 1929 (no idem, p. 369), follow special forms.
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[308] Of course the inclusions and exclusions in a treaty may be due to insistence by either of the parties to the treaty. Yet this record seems to point to the conclusion that the omission of the exclusion from the Belgian-Bulgarian Treaty of 1931 was effected entirely by design, and that it was due to an intention that the provisions of the Treaty should apply to all disputes whether they concerned anterior or posterior situations or facts. While some of the States with which Belgium entered into these treaties were previously bound by declarations under Article 36, paragraph 2, of the Court's Statute, others were not; so that the difference in the texts of the treaties cannot be explained by the previous position of these States with reference to such declarations.

[309] A further point may be mentioned as to the character of the Treaty of 1931. On September 26th, 1928, the Council of the League of Nations instructed the Secretariat to prepare "an introductory note explaining the structure of the treaties", drafts of which had on that date been adopted by the Assembly, and the note was to be communicated to Governments along with the texts [FN2]. On October 15th, 1928, the Secretariat issued a document containing the texts of the General Act and the model bilateral conventions, with an "Introductory Note to the General Act and the model bilateral Conventions a, b, c, for the Pacific Settlement of International Disputes" [FN3]. In this Introductory Note it is said (p. 8) that "the General Act and the three bilateral conventions are in substance the same"; and (on p. 9) it is said that "the conventions had been drafted in such a manner that they in no way affect other conventions of any kind which States may have concluded or may conclude for the pacific settlement of disputes. The new conventions will only be applied subsidiarily and will only settle disputes which do not come within the scope of other conventions. " The importance of this statement is not to be minimized; it is confirmed in the studies of the General Act by the well-informed "Gallus", published in the Revue de Droit international et de Législation compare [FN4] and in the Revue de Droit international [FN5]. "Gallus" stresses the subsidiary character of the General Act, derived from paragraph 2 of Article 29; [p131] and it has been noted above that the model "Convention a" contained a counterpart of that paragraph in its Article 2. The statement quoted from the Introductory Note is applicable to the General Act because of the provision in Article 29, paragraph 2, and to the model bilateral "Convention a" because of the provision in Article 2, paragraph 2. It does not apply to the Treaty of 1931, however, for that Treaty contains no provision corresponding to Article 29, paragraph 2, of the General Act, or to Article 2, paragraph 2, of "Convention a".

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[FN2] League of Nations Official Journal, 1928, p. 1670.
[FN3] Document C. 536. M. 163. 1928. IX.
[FN4] Volume 57 (1930), pp. 190-246, 413-472, 878-925.
[FN5] Volume 8 (1931), pp. 377-424.
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[310] If it had been the intention of the Belgian and Bulgarian Governments that their obligations under the reciprocal declarations should continue unmodified during the period when the Treaty of 1931 was in force, this result could have been accomplished by a simple expedient. The two States might have acted on the Assembly's suggestion in the blank, unnumbered article in Convention "a" and made a reservation as to disputes with regard to anterior facts; or they might have retained in the Treaty a provision corresponding to Article 2, paragraph 2, of "Convention a"; or they might have stated expressly that the Treaty did not in any way modify the effect of the prior declarations. It is not without interest in this connection that this last suggested course was taken by certain other States in concluding similar treaties [FN1], and even by Belgium in concluding the Treaty with Persia of May 23rd, 1929 [FN2].

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[FN1] See the final protocol to the Austrian-Swiss Treaty of October 11th, 1924, 33 League of Nations Treaty Series, p. 432; the additional protocol to the Convention of January 17th, 1925, between Estonia, Finland, Latvia and Poland, 38 idem, p. 368; and the protocol of signature to the Norwegian-Polish. Treaty of December 9th, 1929, 101 idem, p. 340.
[FN2] 110 idem, p. 369.
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*

[311] To summarize what has been said, first of all the reciprocal declarations are not applicable in this case because it is a case for which, to employ the concluding phrase of the Belgian declaration, the Parties have agreed "to have recourse to another method of pacific settlement", the method of the Treaty of 1931. Even if this view be rejected, however, as the text of the Treaty is inconsistent with the texts of the reciprocal declarations and as it is later in point of time, the Treaty must prevail over the declarations during the period when the Treaty is in force. The history of the Treaty shows that the Parties intended for a period to free themselves of the reserve in the Belgian declaration, and to include in the [p132] jurisdiction conferred on the Court disputes with regard to anterior situations or facts. This is borne out, also, by the policy followed both by Bulgaria and by Belgium in concluding treaties with other States. Two essential differences existing between the Treaty of 1931 and "Convention a" of 1928 make it impossible to attribute to the former the subsidiary character which may be attributed to the latter.

[312] The conclusion to be drawn is that on January 26th, 1938, while the Treaty of 1931 was in force, the relations between Belgium and Bulgaria with respect to the jurisdiction of the Court were governed by the Treaty of 1931 and not by the reciprocal declarations made under Article 36, paragraph 2, of the Statute. Hence, the Treaty of 1931 is the sole possible source of the Court's jurisdiction to deal with this case.

***

[313] The conclusion that the Court's jurisdiction to deal with this case must be derived, if at all, from the Treaty of 1931 makes it unnecessary to enquire whether the condition set by the Belgian declaration, that the dispute must be with regard to situations or facts posterior to March 10th, 1926, has been fulfilled in this case. The conclusion makes it necessary, however, to enquire as to the fulfilment in this case of the two conditions set by the Treaty of 1931, (1) the requirement of Article 1 that the dispute must be one "which it may not have been possible to settle by diplomacy", and (2) the requirement that on the hypotheses set out in Article 3 a definitive decision must have been pronounced by a competent local authority. Both of these questions have been raised in connection with the Bulgarian preliminary exception.

*

[314] The provision in Article 1 of the Treaty, that the dispute must be one which it may not have been possible to settle by diplomacy, is not a meaningless formality. In the past the Court has drawn attention to the importance of prior negotiations [FN1], and where the requirement is expressly laid down in a treaty it cannot be disregarded. What is essential is that prior to the filing of an application by one party bringing the dispute before the Court, the other party must have been given the opportunity to formulate and to express its views on the subject of the dispute. Only diplomatic negotiations will have afforded such an opportunity. The precise point at which it may properly be said that the negotiations instituted cannot [p133] result in a settlement of the dispute may have to depend, as the Court has also recognized [FN1] upon "the views of the States concerned".

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[FN1] In the Mavrommatis case, Series A, No. 2, p. 15.
[FN1] Series A, No. 2, p. 15.
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[315] The submissions of the Belgian Government, as stated in its Application and in its Memorial, relate to the alleged failure of Bulgaria in its international obligations (1) by reason of the tariff put into force in 1934 by the State Administration of Mines, to enable the Municipality of Sofia to distort the application of the decisions given by the Mixed Arbitral Tribunal in 1923 and 1925 [FN2]; (2) by reason of the judgments of Bulgarian courts which deprived the Electricity Company of Sofia and Bulgaria of the benefit of the decisions of the Mixed Arbitral Tribunal; and (3) by reason of the promulgation of the law of February 3rd, 1936, establishing a tax on the distribution of electric power purchased from concerns not subject to tax. In so far as Belgium's claims are based on grounds (1) and (2), they were the subject of diplomatic negotiations prior to the filing of the Belgian Application on January 26th, 1938. It may therefore be said that the dispute with respect to these claims was one which, in the language of Article 1 of the Treaty of 1931, it was not "possible to settle by diplomacy".

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[FN2] These decisions are reported in 3 Recueil des LLLDecisions des Tribunaux arbitraux mixies, p 308 and 5 idem, pp 758, 770
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[316] With respect to the claim based on ground (3), i. e. on the promulgation of the Bulgarian law of February 3rd, 1936, the situation is different. This law was not referred to in the previous diplomatic correspondence put before the Court; indeed, in the Additional Memorial of the Belgian Government (p. 16), it was said that the Belgian Government had judged it useless to engage in special negotiations relating to this part of its claim. Though this statement was somewhat modified by the Belgian Agent in the course of the oral proceedings, no proof was furnished of any diplomatic negotiations relating to the law of 1936 which may have taken place prior to the filing of the Belgian Application. It seems clear, therefore, that the condition set by Article 1 of the Treaty was not met with regard to the Belgian claims based upon the promulgation of the Bulgarian law of February 3rd, 1936. Hence the Court lacks jurisdiction to deal with this part of the Belgian claim.

*

[317] It remains to enquire whether the condition set by Article 3 of the Treaty has been met with reference to that part of the Belgian claims which relates to (1) the tariff put into force in 1934 by the State Administration of Mines, and (2) [p134] the judgments of the Bulgarian courts, i. e. the action taken by administrative and judicial authorities in Bulgaria in connection with the application of the price formula fixed by the Mixed Arbitral Tribunal in 1925.

[318] The first paragraph of Article 3 of the Treaty reads as follows:

"In the case of a dispute the occasion (Fr. Objet) of which, according to the municipal law of one of the High Contracting Parties, falls within the competence of its judicial or administrative authorities, the Party in question may object to the matter in dispute being submitted for settlement by the different methods laid down in the present Treaty until a decision with final effect has been pronounced within a reasonable time by the competent authority. "

[319] The provision has some resemblance to, but should not be confused with, the common-law rule concerning the exhaustion of local remedies, which was recently applied by the Court in the case of the Panevezys-Saldutiskis Railway [FN1]. Provisions of similar import are to be found in a large number of recent treaties.

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[FN1] Series A/B, No. 76.
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[320] It was not seriously contested in this case that under Bulgarian law the application of the price formula fixed by the Mixed Arbitral Tribunal in 1925 is a subject (Fr. objet) which, in the first instance at any rate, falls within the competence of the Bulgarian authorities. The exclusive competence of the Bulgarian courts over disputes on this subject was asserted by the Bulgarian Minister for Foreign Affairs in his letter of August 3rd, 1937, addressed to the Belgian Minister; but it was also stated in that letter that, par application de l'article 3 du même traité (i. e., the Treaty of 1931), le Gouvernement bulgare revendique, en I'occurrence, la compétence de ses propres tribunaux, et il ne saurait consentir à ce que le différend soit soumis aux diverses procédures prévues par ledit traité. It would seem to be possible to conclude that for the purpose of applying Article 3 of the Treaty of 1931 the necessary hypotheses exist in this case. The dispute here is one the subject (Fr. objet) of which, according to Bulgarian law, falls within the competence of the judicial or administrative authorities of Bulgaria; and by the letter of August 3rd, 1937, Bulgaria did object to this dispute's being submitted for settlement by a method laid down in the Treaty. That objection is a bar to an exercise of the jurisdiction conferred on the Court "until a decision with final effect has been pronounced within a reasonable time by the competent authority".

[321] In 1936, the Municipality of Sofia instituted an action in the Regional Tribunal of Sofia against the Compagnie d'Électricité [p135] de Sofia et de Bulgarie, seeking a determination of its rights and obligations with reference to the sale-price of electricity at Sofia. The Compagnie defended this action, contending inter alia that the Tribunal lacked jurisdiction. Judgments were rendered in this action by the Regional Tribunal of Sofia on April 30th, 1936, May 26th, 1936, and October 24th, 1936. The Compagnie, and later the Municipality, appealed to the Court of Appeal, which gave its judgment on March 27th, 1937. An appeal (pourvoi) taken to the Cour de cassation by the Compagnie on June 23rd, 1937, was rejected on March 16th, 1938. It is not contended that the interval between June 23rd, 1937, and March 16th, 1938, was more than a reasonable period within the requirement of Article 3 of the Treaty of 1931. This being the case, the facts seem to show quite clearly that when the Belgian Application was filed on January 26th, 1938, the décision définitive required by Article 3 had not yet been pronounced by the competent authority.

[322] The conclusion follows that Article 3 of the Treaty of 1931 prevents the Court from exercising the jurisdiction referred to in Article 4 of that Treaty, with respect to the Belgian claim based upon the action taken by the State Administration of Mines in 1934 and the judgments of the Bulgarian courts in connection with the application of the price formula fixed by the Mixed Arbitral Tribunal in 1925.

***

[323] I am therefore of the opinion that the Court's jurisdiction in this case must be derived, if at all, from the Belgian-Bulgarian Treaty of June 23rd, 1931; that under Article 1 of that Treaty the Court has no jurisdiction to deal with the Belgian claim relating to the promulgation of the Bulgarian law of February 3rd, 1936; and that under Article 3 of that Treaty the Court is precluded from exercising the jurisdiction which would have been conferred by Article 4 of the Treaty with respect to the Belgian claim based upon the action taken in 1934 by the State Administration of Mines and upon the judgments of the Bulgarian courts in connection with the application of the price formula fixed by the Mixed Arbitral Tribunal in 1925.

[324] On this view it is unnecessary to consider other questions which have been discussed before the Court.

[325] For these reasons, I think the preliminary objection advanced by the Bulgarian Government ought to be upheld.

(Signed) Manley O. Hudson. [p136]

Separate Opinion by M. De Visscher.

[Translation]

[326] Although concurring in the operative part of the judgment, I regret I am unable to accept some of its grounds, particularly in regard to two questions which are of considerable importance whether from a general point of view or from the point of view of the present case.

[327] 1.— The first point with which I disagree concerns the relations between the two diplomatic instruments upon which the Parties have relied. The judgment regards the Belgo-Bulgarian declarations accepting the Court's compulsory jurisdiction and the Treaty of June 23rd, 1931, as two separate and independent sources of jurisdiction. In my opinion they are two coordinated instruments; their respective provisions settle different questions ; they are on that account fully consistent one with the other and should be applied not as alternatives, but concurrently.

[328] Although, like the judgment and in conformity with the views of both Parties, I admit that the declarations accepting the compulsory jurisdiction of the Court remained in force during the current period of the 1931 Treaty, I do so because I believe that, when they signed that Treaty, the two States did not intend to establish a new source of jurisdiction. Bound in their mutual relations, as from March 10th, 1926, by an obligation to accept the Court's jurisdiction — an obligation with a longer term of application than that of the Treaty — why should they have suspended it for the pre-arranged term of five years assigned to the application of the Treaty and have substituted during that period a new source of jurisdiction for the pre-existing source, reverting by law to the latter on the expiry of the Treaty ? The argument based upon the Treaty's later date would be decisive in favour of the creation of a new source of jurisdiction only if it were clearly proved that the subject-matter of the undertaking resulting from its Article 4 was really wider in scope than that of the undertaking arising out of the declarations accepting the compulsory jurisdiction of the Court. But, although it is true that Article 4 — like the corresponding clause in the General Act of Geneva (Art. 17), which it reproduces — substituted for the definition of justiciable disputes contained in Article 36 of the Court's Statute the definition of those given in the arbitration conventions annexed to the Locarno Agreements (Oct. 16th, 1925), it cannot be said with certainty that the latter definition is [p137] really any wider than that contained in the above-mentioned Article of the Statute. The definition in Article 36 is drafted in terms of objective law; that of the Locarno arbitration conventions in terms of subjective law. That difference does not allow us to assume any appreciable extension to the field of justiciable disputes. As for the clause in paragraph 2 of Article 4 (Art. 17 of the General Act, second sentence) : "It is understood that the disputes referred to above include in particular those mentioned in Article 36 of the Statute of the Permanent Court of International Justice", the work preparatory to the General Act makes it clear that this clause was only included in the Act because the Locarno definition had been thought by some to be in fact more restrictive in certain respects than the definition in the Court's Statute.

[329] The two other provisions of the 1931 Treaty upon which the Bulgarian Government bases its objection: Article 1, which prescribes diplomatic negotiations, and Article 3 concerning previous exhaustion of internal remedies, are in my opinion of quite another character. They do not strictly concern the jurisdiction of the Court. These provisions appear in Chapter 1 of the Treaty, entitled : "Pacific Settlement in general". They lay down two conditions which the Treaty regards as preliminary to any international procedure falling within the methods in question, namely, conciliation, arbitration and judicial settlement. The reference is no longer to the Court's jurisdiction, but to conditions upon which the Parties have agreed to allow recourse to that jurisdiction to depend.

[330] The two conditions are applicable to the Belgian Government's Application; but, since the general spirit of the Treaty of June 23rd, 1931, is obviously in favour of extending methods of peaceful settlement in general, it is impossible to imagine that, when the contracting Parties embodied in treaty form the rules upon which these conditions were to rest, they intended to make them more binding in their effects than they are under ordinary international law. This remark applies especially to the local redress rule, which is formulated in Article 3 of the Treaty in the same terms as in Article 31 of the General Act of Geneva. The preparatory work of the Ninth Assembly (1928) of the League of Nations shows that the authors of the General Act intended, in this matter as in others, merely to unify the terms of the many previous arbitration conventions, which themselves had only given expression to a rule long sanctioned by international usage. This rule is in fact inscribed in Article 3 of the Treaty of June 23rd, 1931, in terms almost identical with those of Article 3 of the Treaty of arbitration and conciliation between Germany and Switzerland, dated December 3rd, 1921, the prototype of these conventions. [p138]

[331] Finally, the conclusion to be drawn from a study of the various agreements mentioned above is that, in accordance, moreover, with the views of its most authoritative commentators, the General Act, in those of its provisions which apply to judicial settlement and which are reproduced in the 1931 Treaty, made little change in the system established by Article 36 of the Statute of the Court.

[332] Understood in this sense, the combined application of the declarations accepting the Court's compulsory jurisdiction and of the 1931 Treaty cannot involve any contradiction, the jurisdiction of the Court continuing to be based upon the declarations, and the two conditions governing admissibility contained in Articles 1 and 3 of the Treaty being therein fixed in accord-dance with ordinary international law.

[333] 2. — The judgment appears to me to have interpreted Article 3 of the 1931 Treaty relating to the need of exhausting local remedies with a strictness which seems to be in keeping neither with ordinary international law, of which in my view this Article is the mere expression, nor with the general spirit of the Treaty. My observations shall be brief.

[334] It is admitted that the rule requiring previous exhaustion of internal remedies shall be applied, not automatically, but having regard to the circumstances of the case and, more particularly, to any limitations which those circumstances may impose upon the effective nature of the remedy. The very text of the judgment delivered on March 16th, 1938, by the Bulgarian Court of Cassation shows that, in the view of that supreme tribunal, a number of apparently substantial grievances of the Belgian Company constituted grievances of fact which lay outside the Court's jurisdiction. In those circumstances it could only record the sovereign character in regard to them of the judgment given by the Sofia Court of Appeal.

[335] A second circumstance is the attitude of the Bulgarian authorities immediately following the birth of the dispute. In his letter of August 3rd, 1937, to the Belgian Minister in Sofia, the Bulgarian Prime Minister and Minister for Foreign Affairs and Public Worship declared that "the matters in dispute between the Municipality of Sofia and the Belgian Electricity Company .... fall within the exclusive jurisdiction of the Bulgarian courts, which have already given their decision upon them". In the same letter the Bulgarian Government justified its decision to denounce the Treaty of June 23rd, 1931, on the ground that the Belgian Government intended to submit to the Permanent Court of International Justice "a dispute which falls within the competence of the Bulgarian courts". [p139]

[336] Finally, it is established that the Belgian Company, being bound to exhaust the local remedies, did all that lay in its power to this end by having recourse, on June 23rd, 1937, to the exceptional means of an appeal to the Court of Cassation, and it is further agreed that the filing of the Belgian Application on January 26th, 1938, was determined by the imminent expiry of the Treaty which had been denounced by the Bulgarian Government and the benefit of which the Belgian Government was attempting to preserve. In these circumstances, was it necessary, on the basis of the Treaty, to declare the Belgian Government's Application irregular, because it preceded the judgment of the Bulgarian Court of Cassation ? In my opinion, the circumstances briefly outlined above and the general spirit of the Treaty justified a less formal attitude towards a procedure whose only fault lay in its having been precipitated by the denunciation of the Treaty, while that denunciation, taking effect on February 4th following, deprived the Belgian Government, in advance, of the benefit of the appeal lodged by its national with the Court of Cassation and which alone, according to the argument of the Court's judgment, could lead to the "decision with final effect" required by Article 3 of the Treaty of June 23rd, 1931.

(Signed) De Visscher. [p140]

Separate Opinion of M. Erich.

[Translation.]
[337] Although I agree with the operative part of the Court's judgment, I regret that I have been unable to concur on every point in its arguments. I think therefore I ought briefly to state my dissenting opinion..

[338] The two sources invoked by the Parties as binding upon them, namely their declarations accepting the compulsory jurisdiction of the Court and the Treaty of 1931 for as long as it continued in force, indicated between them the extent of the mutual obligation of both Parties to submit their disputes to the Permanent Court of International Justice. There is no doubt that this mutual obligation based upon the declarations was in a certain measure extended by the conclusion of the Treaty.

[339] Disregarding for the moment the argument ratione materiœ invoked by the Bulgarian Government in a very general and even rather diffuse form, which argument the judgment has rightly held not to be a preliminary objection, I find that the Bulgarian Government, while disputing the justice of the Belgian Government's arguments in favour of the Court's jurisdiction, asks the latter "to declare that it has no jurisdiction to entertain the Application filed" and further declares "that the Application submitted by Belgium to the Permanent Court of International Justice cannot be entertained".

[340] The question whether the Bulgarian Memorial, when it speaks either of "questions of jurisdiction and admissibility" or of "the question of jurisdiction and admissibility", intended to raise a single objection implying two objections, or two different objections, is of no decisive importance.

[341] Bulgaria disputed the treaty bases of the Court's jurisdiction, alleging generally the absence of any international element in the present dispute and advancing, in the second place, with regard to the declarations, the objection ratione temporis. The objection based upon Article 3 of the 1931 Treaty and disputing the admissibility of the Application, is of a different character. A party who argues that an application cannot be entertained is not maintaining thereby that the subject of the dispute does not fall within the competence of the court in question; it is adducing a certain circumstance which in its opinion constitutes an obstacle to proceedings. The same is true when the party invokes the non-exhaustion of local [p141] remedies or the absence of diplomatic negotiations, both cases creating a gap which does not affect the jurisdiction of the Court as recognized by the parties in question.

[342] An objection to jurisdiction and an objection to admissibility are not therefore mutually exclusive. They may co-exist and should be examined separately, even when the same party has impugned both jurisdiction and admissibility. The fact that the party raising the objections has apparently confused them is of no importance, provided that the distinction emerges in fact from its claims.

[343] The objection to jurisdiction is obviously a preliminary objection in relation to the objection to admissibility. If the Court finds that it has no jurisdiction, the objection to admissibility lapses, having lost its raison d'être ; if, on the other hand, the Court declares in favour of its jurisdiction, it has not thereby affirmed that the application can be entertained.

[344] Accordingly, if we are confronted with an objection to jurisdiction and an objection to admissibility, we should begin by examining the question of jurisdiction proper. If jurisdiction is not admitted, the whole case falls to the ground and the objection to admissibility ceases to have any relevance. In the opposite case the force of the objection to admissibility is unimpaired and remains to be examined separately. The same is obviously true when it is found that an objection to the jurisdiction of the Court is closely bound up with the merits of the dispute ; the jurisdiction is here too preserved, at least for the time being.

[345] The objection relating to exhaustion of internal remedies is indivisible. The Party who advances this objection does not mean that, from the point of view of the Treaty, these remedies are not exhausted, but that, from another point of view, that of the declarations, the objection based on exhaustion does not operate. The remedies are either exhausted or they are not. Once the objection based on alleged non-exhaustion is found to be just, it is impossible to cancel the effects of that finding by admitting also that the jurisdiction of the Court is established. The establishment of jurisdiction does not of itself suffice to rule out the objection to the application being entertained.

***

[346] The argument ratione materiœ, that is to say the general and somewhat diffuse objection whereby the Bulgarian Government seeks to exclude the Court's jurisdiction, was rightly denied to be a preliminary objection and was reserved for [p142] examination with the merits. The objection ratione temporis, which likewise challenges the jurisdiction of the Court, is logically subordinate to the objection ratione materiœ in the sense that, should the latter be subsequently approved by the Court, the argument ratione temporis would lose its raison d'être and become inoperative. If we find that the case is not a dispute in the international sense, the question of priority, or otherwise, of date would no longer arise.

[347] But since the Court has already examined the argument ratione temporis, I should like to offer a few observations on this subject.

[348] The reservation ratione temporis inserted in many international undertakings appears in different terms. When we exclude "disputes which have their origin in facts prior to the present Convention", that expression appears perhaps more restricted than the words used in the Belgian declaration : "disputes arising after the ratification of the present declaration with regard to situations or facts subsequent to this ratification" ; fundamentally there is little difference between the intentions of the contracting States. Any dispute caused by facts or measures of a legal character prior to a certain decisive and crucial date are excluded from the application of the rule. Such formulae may be criticised as inexact and likely to cause confusion, but they must be given the meaning which the contracting Parties had in mind.

[349] During the first stage of the present dispute, both Parties apparently considered the origin of their dispute to lie in the formula contained in the award of the Mixed Arbitral Tribunal of 1925. The Belgian Application (p. 4), in telling the story of past events, speaks of the tariff formula fixed by the Arbitral Tribunal. Until 1934 the application of this formula gave rise to no difficulties, but disagreement arose for the first time in the last quarter of that year. The compromise arranged for !935 was not prolonged, "and the dispute again arose with regard to calculating the tariff for the first quarter of 1936". In its Additional Memorial (p. 8) the Belgian Government indicates as follows what it regards as the criterion in order that the reservation in the Belgian declaration may apply: ".... it is not enough that the dispute arising subsequently to this declaration should have some relation with a situation in law or of fact prior thereto; the dispute must arise with actual regard to that situation". The same phrase "with regard to" is therefore found both in this general and abstract formulation of the rule and in the above-mentioned sentence in the Application which deals with the tariff formula fixed by the Arbitral Tribunal. In the Belgian Government's Memorial (p. 14) the formula fixed by this Tribunal is called "the disputed formula". [p143] From these expressions and from several others it would appear that the Belgian Government in the first stage of the dispute regarded certain alleged acts by the Bulgarian authorities to be the subject-matter of the dispute, but held the formula to be the source of it, in other words, the situation with regard to which the dispute arose.

[350] If the Mixed Arbitral Tribunal had complied with the Company's request when asked to give an interpretation of the arbitral award of May 27th, 1925, the dispute submitted to this Tribunal would obviously have been a dispute directly with regard to the arbitral award,. And the same is true when the Bulgarian courts were required to adjudicate upon the matter. The salient point upon which their discussions turned was precisely "the disputed award" of 1925. As the decisions by the courts failed to satisfy the Company, the protecting State, Belgium, applied to the Court. It is certainly not "the disputed formula" as such which was submitted to the examination of the Court. If it were so, this formula would have to be regarded as the actual subject of the dispute. The Belgian complaints are directed against certain acts of the Bulgarian authorities, and it is these acts which constitute the subject of the dispute ; it was they which occasioned it. Essentially, however, they obviously assume the existence of prior situations or facts (cf. the Court's judgment in the case of the Moroccan Phosphates, p. 24). The dispute derives from facts prior to March 10th, 1926. The disputed award constitutes a situation prior to the crucial date. That prior situation gave birth to differences of opinion that arose subsequently to that date.

[351] If taken in a very limited sense, the ratione temporis reservation, emphasized by many countries in their declarations, might become almost void of substance. Alleged damage suffered before the entry into force of the undertaking could be resuscitated by a claim submitted to some national judicial or administrative authority subsequently to the crucial date. The final dismissal of the claim could then be alleged as an unlawful act and as the element giving birth to the dispute. In this way the interested party would be enabled to revive a dispute to which, under the reservation, the convention ought not to apply.

[352] For the reasons given above, I am inclined to regard the present dispute as having arisen with regard to a situation prior to ratification of the declaration. But the ratione temporis reservation operates only within the limits of that declaration ; it was not inserted in the 1931 Treaty, which was still in force at the time when the case was submitted to the [p144] Court. Since the Court has adjudicated upon the ratione temporis objection before giving any decision in regard to the preliminary ratione materiœ objection, I must declare at this stage that the distinction according to whether the dispute is prior or subsequent to a certain date does not apply in so far as concerns the 1931 Treaty.

***

[353] The Court has admitted the justice of the Bulgarian objection based on failure to exhaust internal remedies. The Application must therefore be regarded as inadmissible. According, however, to the view that prevailed, the force of this finding is invalidated by the fact that the Court's jurisdiction is accepted on the basis of the declarations of adherence to the optional clause. Even if the contrary conclusion had prevailed, the admission of the dispute as having arisen with regard to a situation subsequent to ratification would have meant that Belgium would still have the right to submit to the Court a fresh application on the basis of the mutual declarations.

[354] In these circumstances, I can be brief on the question of exhaustion. I would only say that the conditions required under Article 3 of the 1931 Treaty were not fulfilled at the time when the Belgian Government applied to the Court. At the same time, the local redress rule, even if established in a treaty clause, is not incompatible with certain departures from it, although these, unlike the rule itself, are not laid down in a written text. There are reasons for weighing the merits of an alleged departure from the rule and for taking account of what appears reasonable in a particular case. The Treaty of 1931, which requires that pacific methods of settling international disputes shall be followed as far as is possible, was denounced by one of the Parties at the moment when the Treaty was about to be applied, and was denounced in order to prevent any examination of the dispute by an international body. Belgium, who was probably not sure of being able to approach the Court on the basis of the declaration, the latter being subject to the ratione temporis reservation, was faced with a real periculum in mora ; the action she took is explained by the abnormal situation created by the denunciation of the Treaty. Furthermore, since the Court of Cassation in Bulgaria delivered its judgment, the internal remedies have in fact been exhausted. [p145]

[355] Although I hold that this objection to admissibility should have been treated separately and independently of the question concerning the extent of the Court's compulsory jurisdiction, I consider that a departure from the local redress rule was in this case justified. On that account, and notwithstanding differences of opinion on certain points, I have been able to concur in the operative part of the judgment.

(Signed) R. Erich. [p146]

Dissenting Opinion by M. Papazoff.

[Translation.]

[356] Being unable to concur in the judgment affirming the jurisdiction of the Court under the declarations of Belgium and Bulgaria accepting the compulsory jurisdiction of the Court, I feel that I must briefly record my separate opinion.

[357] Under Article 36, paragraph 2, of the Statute of the Court, Belgium and Bulgaria have undertaken to recognize the compulsory jurisdiction of the Court under the conditions laid down in their declarations of adherence.

[358] Bulgaria's declaration, which was ratified on August 12th, 1921, is as follows : "On behalf of the Government of the Kingdom of Bulgaria, I recognize, in relation to any other Member or State which accepts the same obligation, the jurisdiction of the Permanent Court of International Justice .... unconditionally."

[359] Belgium's declaration is as follows : "On behalf of the Belgian Government, I recognize as compulsory, ipso facto and without special agreement, in relations to any other Member or State accepting the same obligation, the jurisdiction of the Court in conformity with Article 36, paragraph 2, of the Statute of the Court for a period of fifteen years, in any disputes arising after the ratification of the present declaration with regard to situations or facts subsequent to this ratification, except in cases where the Parties have agreed or shall agree to have recourse to another method of pacific settlement."

[360] This declaration was ratified and came into effect on March 10th, 1926.

[361] The Bulgarian declaration makes one condition only, that of reciprocity.

[362] It is however recognized that the limitation embodied in the Belgian declaration applies as between the Parties, in consequence of the condition of reciprocity made in paragraph 2 of Article 36 of the Court's Statute, which is moreover repeated in the Bulgarian declaration.

[363] Accordingly, it is necessary to determine the meaning and scope of the limitation embodied in the declaration of the Belgian Government. This limitation comprises two conditions: (1) the dispute must have arisen after the ratification of the declaration, and (2) the dispute must have arisen with regard to situations or facts subsequent to this ratification.

[364] The Belgian declaration having been ratified on March 10th, 1926, it is that date, which may be called the "material date", which must be taken into account. [p147]

[365] The Belgian declaration is drafted in such a way as to preclude any possibility of retrospective effect. The Court's compulsory jurisdiction is only accepted for the future. In no case can the past be called in question. That is why the condition that the dispute must have arisen after the ratification of the declaration is not enough ; a further condition is necessary, namely that it must not have arisen with regard to situations or facts dating from before such ratification. In the present case, the two Parties agree that the dispute arose after the material date (i.e., after March 10th, 1926).

[366] The Bulgarian Government, however, which has raised an objection to the jurisdiction ratione temporis, maintains that the second condition is not fulfilled, because the present dispute has arisen in regard to situations or facts dating from before March 10th, 1926. This objection is, in my opinion, fully established by the particulars furnished in the written proceedings. For the letter of the Belgian Minister of June 24th, 1937, in which he expresses the intention of the Belgian Government to refer the case to the Permanent Court of International Justice, contains the following passage: "After a review of the previous facts, a careful study of the judgment given by the Court of Appeal of Sofia on March 27th last has convinced the Belgian Government that the judicial decision rendered disregarded, notably on two points of fundamental importance, the rights of the Company as defined by the Belgo-Bulgarian Mixed Arbitral Tribunal set up under the Treaty of Neuilly, in its awards of July 5th, 1923, and May 27th, 1925, the strict application of which the Bulgarian Government was bound to ensure under the express terms of an international agreement, namely Article 188 of the Treaty of Neuilly." This letter makes it plain that the dispute arises from the situation established by the Belgo-Bulgarian Mixed Arbitral Tribunal's awards of July 5th, 1923, and May 27th, 1925.

[367] The Belgian Memorial shows no less clearly that the present dispute arose with regard to the situation created by these awards. On page 12 of this Memorial we read : "In view of the disputes which arose with regard to the application of the formula contained in the Mixed Arbitral Tribunal's awards", etc. ; and on page 14: "the experts responsible for the disputed formula" ; on page 22 : "the Belgian Government regards as a misapplication of the Mixed Arbitral Tribunal's award", etc. ; and on page 33 : "The Bulgarian High Courts have upset the very foundations of the whole system worked out by the Mixed Arbitral Tribunal."

[368] This "system worked out" is certainly the "situation" created by the awards of the Mixed Arbitral Tribunal of 1923 and 1925 with regard to which the dispute arose. Without [p148] the "formula" established by the Mixed Arbitral Tribunal there could have been no dispute.

[369] In my opinion, this "situation" and the dispute which arose in 1937 stand in the relation of cause and effect. The Company could not have contended that its rights had been infringed, if the situation created by the awards of 1923 and 1925 had not existed. But this situation dates from before March 10th, 1926, and I think that that suffices. In my view it is unnecessary that the situation should itself have given rise to the dispute and that it should itself form the subject of a difference of opinion.

[370] No such condition is made in the Belgian declaration. What is laid down is that the dispute must arise, that is to say must be born, after the ratification of the declaration. Furthermore, in order to prevent the declaration from having any retrospective effect, the dispute must have no connection with earlier situations or facts. This condition is contained in the words "with regard to". The essential point is that the past must not be called in question in any way, since the declaration of adherence is only to operate for the future.

[371] I find this interpretation of the words "with regard to" confirmed by the fact that, whenever it was desired to take account of the origin of disputes in earlier facts, this was expressly stated. In the many treaties of conciliation, arbitration and judicial settlement concluded between Belgium and other countries, two different formulae were used to fix the non-retrospective condition. Thus in the treaties concluded between Belgium and Germany, Turkey and Roumania we read: "disputes arising out of events prior to the present Convention and belonging to the past".

[372] On the other hand, the treaties concluded by Belgium with Sweden, Switzerland, Finland, Portugal, Poland and Denmark contain the same expressions as those used in the Belgian declaration accepting the Court's compulsory jurisdiction and specify that the treaty shall only apply to disputes that may arise after the exchange of ratifications with regard to situations or facts prior to that date. In these treaties there is no longer any question of disputes "arising out of" prior events, nor any such words as "dispute arising out of a prior situation".

[373] The fact that the present dispute goes back to a date prior to March 10th, 1926, is also clear from the submissions in the Belgian Memorial, which, in enumerating the damage sustained by the Electricity Company, says : "As the result of the judicial decisions rendered, the Company was required to pay to the Municipality of Sofia or to the Bulgarian Treasury : (a) as refund of excise alleged to have been collected under unlawful [p149] conditions from 1925 to 1937", etc. Thus the dispute is concerned with sums received as long ago as 1925.

[374] For the reasons given, I have come to the conclusion that the present dispute, although it arose after the material date of March 10th, 1926, arose with regard to a prior situation created by the awards of the Mixed Arbitral Tribunal given in 1923 and 1925.

[375] I therefore hold that this dispute, by reason of the limitation ratione temporis contained in the Belgian declaration, does not fall within the jurisdiction of the Court.

(Signed) Papazoff. [p152]

Annex.

Documents Submitted To The Court.

I. - Documents Filed on Behalf of the Belgian Government

In the course of the written proceedings :

1. Award of the Mixed Arbitral Tribunal of July 5th, 1923.
2. Award of the Mixed Arbitral Tribunal of May 27th, 1925.
3. Award of the Mixed Arbitral Tribunal of October 30th, 1925.
4. Cahier des charges (extracts).
5. Tariff of the Pernik Mines, February 13th, 1924.
6. Tariff of the Pernik Mines, February 14th, 1925.
7. Tariff of the Pernik Mines, June 12th, 1925.
8. Letter of the Electricity Company of Sofia and Bulgaria to the Pernik Mines, No. 707, May 8th, 1929.
9. Letter of the Pernik Mines to the Electricity Company, No. 5734, May 10th, 1929.
10. Letter of the Pernik Mines to the Electricity Company, No. 6627, May 29th, 1929.
11. Letter of the Municipality of Sofia to the Electricity Company, No. 6786, August 10th, 1931.
12. Letter of the Electricity Company to the Municipality of Sofia, No. 1286, October 6th, 1934:
13. Letter of the Municipality of Sofia to the Electricity Company, No. 7584, October 23rd, 1934.
14. Certificate issued by the Pernik Mines, October 24th, 1934.
15. Letter of the Electricity Company to the Municipality of Sofia, No. 1482, November 15th, 1934.
16. Letter of the Pernik Mines to the Municipality of Sofia, No. 28942, November 15th, 1934.
17. Letter of the Municipality of Sofia to the Electricity Company, No. 8599, November 20th., 1934.
18. Letter of the Electricity Company to the Municipality of Sofia, No. 1531, November 26th, 1934.
19. Letter of the Pernik Mines to the Electricity Company, No. 30460, November 26th, 1934.
20. Tariff of the Pernik Mines, December 3rd, 1934.
21. Note presented at a plenary meeting of the Municipality of Sofia, November 30th, 1934.
22. Letter of the Electricity Company to the Municipality of Sofia, No. 1599, December 10th, 1934.
23. Convention of December 1934 fixing the tariff for the year 1935.
24. Letter of the Electricity. Company to the Municipality of Sofia, No. 1659, October 29th, 1935.
25. Letter of the Municipality of Sofia to the Electricity Company, No. 12651, December 13th, 1935.
26. Letter of the Electricity Company to the Municipality of Sofia, No. 1958, December 30th, 1935.
27. Letter of the Electricity Company to the Municipality of Sofia, No. 80, January 27th, 1936. [p153]
28. Letter of the Municipality of Sofia to the Electricity Company, No. 824, January 31st, 1936.
29. Letter of the Municipality of Sofia to the Electricity Company, No. 37, January 20th, 1936.
30. Letter of the Electricity Company to the Municipality of Sofia, No. 91, February 1st, 1936.
31. Letter of the Municipality of Sofia to the Electricity Company, No. 130, February 3rd, 1936. '
32. Note verbale No. 840/1456, October 26th, 1935, from the Belgian Minister in Sofia to the Ministry for Foreign Affairs and Public Worship. .
33. Aide-memoire No. 840/1457, October 27th, 1935, annexed to the note verbale No. 840/1456.
34. Note verbale No. 840/117, January 27th, 1936, from the Belgian Legation in Sofia to the Ministry for Foreign Affairs and. Public Worship.
35. Note verbale No. 840/125, January 28th, 1936, from the Belgian Legation at Sofia to the Ministry for Foreign Affairs and Public Worship.
36. Note verbale No. 840/141, February 6th, 1936, from the Belgian Legation in Sofia to the Ministry for Foreign Affairs and Public Worship.
37. Note verbale No. 4714-49-II, February 18th, 1936, from the Ministry for Foreign Affairs and Public Worship to the Belgian Legation in Sofia.
38. Note verbale No. 12438-23-II, May 14th, 1936, from the Ministry for Foreign Affairs and Public Worship to the Belgian Legation in Sofia.
39. Award of the Mixed Arbitral Tribunal of December 29th, 1936.
40. Claim of the Municipality of Sofia against the Electricity Company brought before the Regional Court of Sofia.
41. Answer of the Electricity Company, March 14th, 1936.
42. Decision of the Regional Court concerning the admission of evidence.
43. Judgment of the Regional Court of Sofia upon the objection to the jurisdiction, May 26th, 1936.
44. Judgment of the Regional Court of Sofia of October 24th, 1936.
45. Appeal of the Electricity Company, January 2nd, 1937.
46. Judgment of the Court of Appeal of Sofia, March 27th, 1937.
47. Communique issued by the Mayor (March 28th, 1937) and published in the Sofia daily papers the day following the delivery of the Court of Appeal's judgment and on the eve of the elections.
48. Letter of the Electricity Company to the Municipality of Sofia, No. 475, April 28th, 1937.
49. Certificate drawn up by the officials of the Electricity Company and of the Municipality respecting the restoration of the supply of current to customers (April 29th, 1937).
50. Letter of the Municipality of Sofia to the Electricity Company, No. 2811, April 29th, 1937.
51. Letter of the Electricity Company to the Municipality of Sofia, No. 493, May 5th, 1937.
52. Law regarding income tax of February 3rd, 1936 (extracts).
53. Circular No. 3800 of February 28th, 1936, of the Ministry of Finance.
54. Law amending and supplementing the law of February 3rd, 1936, regarding income tax.
55. Letter of the Electricity Company to the Minister of Finance, May 18th,. 1936.
56. Letter of the Belgian Minister in Sofia to M. Kiosseivanofi, President of the Council, No. 840/961, June 24th, 1937.
57. Letter of the Belgian Minister in Sofia to M. Kiosseivanoff, President of the Council, No. 1144, July 30th, 1937.
58. Letter of the Minister for Foreign Affairs and Public Worship to the Belgian Minister in Sofia, No. 19179-46-II, August 3rd, 1937.
59. Letter of the Belgian Minister in Sofia to M. Kiosseivanoff, President of the Council, No. 1163, August 3rd, 1937.
60. Appeal of the Electricity Company to the Court of Cassation, June 23rd, 1937. [p154]
61. Judgment of the High Court of Cassation of Sofia, March 16th, 1938.
62. Decree Law of March 13th, 1938, .respecting the regulation of relations between consumers of electric current and the Electricity Company.
63. Certificate issued by the Pernik Mines, June nth, 1936.
64. Certificate issued by the Pernik Mines, March 17th, 1937.
65. Regulations concerning the creation of Compensation Offices attached to Chambers of Commerce.
66. Bulletin No. 891 (Dec. 25th, 1936) of the Sofia Chamber of Commerce and Industry.
67. Letter of the National Bank of Bulgaria, No. 28900, November 26th, 1936.
68. Letter of the National Bank of Bulgaria, No. 33327, January 4th, 1937.
69. Judgment No. 133, February 5th, 1937, of the High Administrative Court.
70. Various laws concerning excise duties.
71. Regulations concerning the method of assessment and collection of excise duty on electric current used for lighting (Sept. 16th, 1914).
72. Letter of the Municipality of Sofia to the Electricity Company, No. 2044, May 26th, 1928.
73. Letter of the Electricity Company to the Municipality of Sofia, No. 1197, May 29th, 1928.
74. Letter of the Municipality of Sofia to the Electricity Company, No. 2110, June 1st, 1928.
75. Letter of the Electricity Company to the Municipality of Sofia, No. 1300, June 8th, 1928.
76. Letter of the Electricity Company to the Municipality of Sofia, No. 1616, July 18th, 1928.
77. Letter of the Municipality of Sofia to the Electricity Company, No. 3536, July 24th, 1928.
78. Letter of the Municipality of Sofia to the Electricity Company, No. 10652, November 2nd, 1935.
79. Extract from the Judgment of the Court of Cassation, No. 283, of March 25th, 1926, concerning the Rodopi Company.

II. - Documents Filed on Behalf of the Bulgarian Government.

A. - In the course of the written proceedings :

1. Judgment No. 653, October 24th, 1936, of the Regional Court of Sofia.
2. Judgment No. 70, March 27th, 1937, of "the Court of Appeal of Sofia.
3. Judgment No. 177, March 16th, 1938, of the High Court of Cassation of Sofia.
4. Minute of the Bulgaro-Belgian Mixed Arbitral Tribunal, October 30th, 1930.
5. Award of the Bulgaro-Belgian Mixed Arbitral Tribunal, December 29th, 1936.
6. Letter No. 840/568, April 22nd, 1937, from M. Motte, Belgian Minister in Sofia, to M. Kiosseivanoff, President of the Council of Ministers, Minister for Foreign Affairs and Public Worship of Bulgaria.
7. Certificate No. 3875, June 7th, 1938, of the Bulgarian Ministry of Justice.
8. Bulgarian and Belgian declarations adhering to the optional clause concerning the compulsory jurisdiction of the Permanent Court of International Justice.
9. Treaty of conciliation, arbitration and judicial settlement of June 23rd, 1931, between Bulgaria and Belgium.
10. Letter No. 19179-46-II, August 3rd, 1937, from M. Kiosseivanoff, President of the Council of Ministers, Minister for Foreign Affairs and Public Worship of Bulgaria, to M. Motte, Belgian Minister in Sofia. [p155]
11. Letter No. 593, August 3rd, 1937, from M. Miankofi, Bulgarian Charge d'affaires ad interim in Brussels, to M. Spaak, Belgian Minister for Foreign Affairs and Foreign Trade.
12. Letter No. 452/1-438/5406, August 3rd, 1937, from the Belgian Ministry for Foreign Affairs and Foreign Trade to M. Miankoff, Bulgarian Charge d'affaires ad interim in Brussels.

B. - In the course of the oral proceedings :

- Collection of contracts between the Municipality of Sofia and the concessionaires for the supply of electric power and for the Sofia tramways. (Bulgarian and French texts. Sofia, 1930.)



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