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?
	Arbitration is different than mediation. Mediation is a method of dispute resolution whereby the disputing parties achieve a mutually-satisfactory resolution with the assistance of a mediator. Unlike arbitration sessions, mediation sessions are not “decided” in favor of one party or another; rather, the mediator simply facilitates the negotiation process between the parties. Mediating parties are not bound to resolve their dispute (although mediated settlements, once reached, can be made binding if the parties decide to draft a contract called a settlement agreement). Arbitrating parties, on the other hand, receive a final decision from the arbitrator, which is either binding or non-binding depending on the terms of the arbitration agreement.