October 20, 2010
October 10, 2010
NAFTA IS SO FRAGMENTED AND FLAWED THAT INVESTOR STATE DISPUTES UNDER CHAPTER 11 IS A EXERCISE IN FUTILITY
By Melvin J. Howard
Not only where we denied the opportunity to present our case (i.e. have our day in court ) I have also have issues with excess of jurisdiction and was the Tribunal appropriately formed? Ok lets forget about the merits of the case we all know by now Canada has a private health care system. They just don’t want American health care companies to participate in that private health care system. No matter how you try to pretty it up with legal jargon bottom line we all know Canada was in breach of the treaty. But here is where they really thought they would pull a fast one. The conflict issue, there was so many of them in my case I would have a better chance for justice in Judge Judy’s or Judge Mathis’s courtroom. I am not the only one who feels NAFTA Chapter 11 needs judicial oversite. As described in a paper by David A. Gantz, University of Arizona, Rogers College of Law http://www.law.arizona.edu/faculty/getprofile.cfm?facultyid=41 Concerns are being raised by the U.S. Congress, NGOs and some foreign governments over the lack of consistency (or serious errors) among the decisions that emanate from the largely ad hoc arbitral panels that are created under the provisions of bilateral investment treaties and the investment provisions of free trade agreements, such as NAFTA, Chapter 11. As a result, it is suggested that anappellate mechanism, perhaps patterned after the generally successful Appellate Body of the World Trade Organization, be created.
During the past few years there has been increasing discussion of a new "appellate body," or to avoid confusion with the World Trade Organization (WTO), an "appellate mechanism," for reviewing arbitral decisions in investor-state disputes. (1) While the current interest in the concept appears to have originated in the debate leading up to the United States' Trade Promotion Authority legislation of 2002, Professor Thomas Walde indicates that the idea dates back at least to 1991. (2) The most recent concrete proposal, subsequently recanted and now in limbo, was offered in an October 2004 International Centre for Settlement of Investment Disputes (ICSID) Secretariat document. (3)
The appellate mechanism issue, however, is no longer simply an academic or theoretical one. Once the United States-Central American-Dominican Republic Free Trade Agreement (CAFTA-DR) (4) enters into force, presumably some time in 2006 for most of the signatories, (5) an annex to CAFTA-DR requires the parties to establish a negotiating group for an "appellate body or similar mechanism" within three months and to prepare a suitable amendment to CAFTA-DR within a year thereafter. (6) It is thus reasonably possible that some sort of more concrete proposal for an appellate mechanism will evolve in the CAFTA-DR context. If the process outlined in CAFTA-DR succeeds, there will be renewed pressure to agree on a similar mechanism on the parties to the North American Free Trade Agreement (NAFTA) (7) (United States, Canada, Mexico) and signatories to other recent U.S. bilateral investment treaties (BITs) and free trade agreements (FTAs) with investment provisions.
Actual implementation of an investment appellate mechanism for CAFTA-DR, NAFTA, or other FTAs or BITs is, of course, another matter entirely. Such a process, which requires an amendment to each of the agreements by each party through its constitutional processes, could take years to complete, or may never reach fruition. The controversial nature of the appellate mechanism and the political sensitivity, after CAFTA-DR, of submitting any trade agreement or amendment thereto to the U.S. Congress or other legislatures, make prompt creation of an appellate mechanism highly problematic, even assuming that the CAFTA-DR negotiating group actually produces a "draft amendment" in a timely manner. This Article http://law.bepress.com/cgi/viewcontent.cgi?article=3890&context=expresso discusses how the investment appellate mechanism concept originated; reviews the current "appeal" process for investor-state arbitral decisions, with particular attention to the three NAFTA Chapter 11 arbitral decisions that have been reviewed to date; sets forth the rationale supporting an appellate mechanism; and considers the key legal issues, standard of review, and other major political, procedural, and legal hurdles. The Article concludes with a few comments and recommendations. Here is my comment pay close attention the conflict heading if you get my drift. One thing I hate to be is a foregone conclusion this is not over not by a long shot I want justice even if it takes me to point out every flaw in the chapter 11 process.