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 are many advantages to arbitration. Parties often seek to resolve their disputes through arbitration because of a number of perceived potential advantages over judicial proceedings. Some advantages include, but are not limited to: (1) when the subject matter of the dispute is highly technical, arbitrators with an appropriate degree of expertise can be appointed, (2) arbitration is often faster and cheaper than litigation in court, (3) arbitral process enjoys a greater degree of flexibility than courts, and (4) arbitration awards are generally easier to enforce abroad than court judgments.