Contract negotiation: Legal analysis of the duty of good faith and role of international arbitration

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Abstract

This paper examines the research problem of how the doctrine of good faith and international arbitration shape negotiation dynamics in international contracting. The purpose of the research is to determine the extent to which these principles provide guidance on the behavior of the contracting parties, protect their expectations, and ensure the enforceability of contracts in different legal systems. Using the comparative doctrinal methodology, the paper contrasts civil law systems, where good faith is a binding obligation throughout the process of negotiations, with the common law systems, where good faith is traditionally circumscribed. The findings suggest that properly formulated good faith clauses and extensive arbitration agreements reduce negotiation failures, enhance contractual certainty, and support efficient dispute avoidance and resolution. The conclusion underlines that integrating both principles into the negotiation process minimizes disputes and strengthens commercial relationships. The contribution of this paper is the connection between the theoretical doctrines of good faith and the practical functions of arbitration, offering insights for more effective and harmonized international trade practices (Cordero-Moss, 2014).

Keywords: Contract Negotiation, Good Faith, International Arbitration, Comparative Law, Dispute Resolution, Enforceability

Authors’ individual contribution: Conceptualization — A.D.; Methodology — A.D. and B.M.; Software — B.M.; Validation — A.D.; Formal analysis — B.M.; Investigation — A.D.; Resources — A.D.; Data Curation — A.D.; Writing — Original Draft — A.D.; Writing — Review & Editing — B.M.; Visualization — A.D.; Supervision — B.M.; Project Administration — B.M.; Funding Acquisition — A.D.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: K12, K33, K41

Received: 10.09.2025
Revised: 21.11.2025; 02.02.2026
Accepted: 11.02.2026
Published online: 13.02.2026

How to cite this paper: Dauti, A., & Murati, B. (2026). Contract negotiation: Legal analysis of the duty of good faith and role of international arbitration. Corporate Law & Governance Review, 8(1), 162–168. https://doi.org/10.22495/clgrv8i1p14