Arbitration News

NAFTA Investor-State Arbitrations

Chapter Eleven of the North American Free Trade Agreement (the "NAFTA") contains provisions designed to protect cross-border investors and facilitate the settlement of investment disputes. For example, each NAFTA Party must accord investors from the other NAFTA Parties national (i.e. non-discriminatory) treatment and may not expropriate investments of those investors except in accordance with international law. Chapter Eleven permits an investor of one NAFTA Party to seek money damages for measures of one of the other NAFTA Parties that allegedly violate those and other provisions of Chapter Eleven. Investors may initiate an arbitration against the NAFTA Party under the Arbitration Rules of the United Nations Commission on International Trade Law ("UNCITRAL Rules") or the Arbitration (Additional Facility) Rules of the International Centre for Settlement of Investment Disputes ("ICSID Additional Facility Rules").

The Department of State is the lead agency representing the U.S. Government in most of the NAFTA Chapter Eleven cases.  The State Department works closely with other agencies to develop U.S. Government positions in these cases. The Department of Justice is the lead agency in The Loewen Group, Inc., v. United States.

Since the NAFTA's entry into force on January 1, 1994, several cases have been filed against each of the NAFTA Parties.  The links at the left connect to pages describing the cases against each of the State Parties and containing pleadings and certain other documents that are publicly available under the rules and confidentiality agreements applicable in each case.

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	Did You Know?
	There is one drawback to arbitration. There are no guarantees that arbitration will be a fair process. Once a decision is rendered in a binding arbitration, the parties are generally stuck with that decision. Without the right to appeal, there is always the risk of being subject to the whims and prejudices of the arbitrator. Overall, this is probably the biggest drawback to the arbitration process.