Non-disputing Party Submission under the Nafta

Non-disputing Party Submission Under Chapter 11 of the North American Free Trade Agreement in 2013 (Continuation)

United States views on international law [1] in relation to Non-disputing Party Submission Under Chapter 11 of the North American Free Trade Agreement: 8. The phrase “in like circumstances” ensures that comparisons are made with respect to investors or investments on the basis of characteristics that are relevant for purposes of the comparison. Thus, identifying appropriate domestic comparators for purposes of the “in like circumstances” analysis under Article 1102 is a highly fact-specific inquiry, requiring consideration of more than just the business or economic sector, but also the regulatory framework and policy objectives, among other possible relevant characteristics.

9. Nothing in Article 1102 paragraphs (1) and (2) requires that investors or investments of investors of a Party, regardless of the circumstances, be accorded the best or most favorable treatment given to any domestic investor or investment. The relevant comparison is between the treatment that a Party accords to an investment of an investor of another Party and the best treatment that it accords to the investments of its nationals (or between the treatment that it accords to an investor of another Party and the best treatment that it accords to investors that are its nationals) only if the foreign investment or investor and a domestic investment or investor are in like circumstances. This distinction is important and was intended by the Parties. Thus, a NAFTA Party may adopt measures that draw legitimate distinctions among entities without necessarily violating Article 1102.

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10. The national treatment obligation does not, as a general matter, prohibit a Party from adopting or maintaining measures that apply to or affect only a part of its national territory. The NAFTA Parties did not intend Article 1102 to foreclose the use of location-based regulatory measures. The United States, for example, limits business activities in certain environmentally sensitive areas and imposes additional limitations on emissions from manufacturing operations in areas where air pollution is more serious.

11. For the foregoing reasons, an investor or investment that operates within the territory covered by a location-specific measure may not be in circumstances “like” those of an investor or investment that does not operate within that territory. Therefore, an investor cannot rest its claim under Article 1102 on the fact that a domestic enterprise operating in another part of the country receives a different or greater benefit or is subject to a different or lesser burden unless it is “in like circumstances” with that enterprise.

Development

Article 1116(2) (Limitations Period)

12. All claims under NAFTA Chapter Eleven must be brought within the three-year limitations period set out in Articles 1116(2) and Article 1117(2).15 Although a legally distinct injury can give rise to a separate limitations period under NAFTA Chapter Eleven, a continuing course of conduct does not extend the limitations period under Article 1116(2) or Article 1117(2).

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6 See, e.g., Methanex v. United States, Memorial on Jurisdiction and Admissibility of Respondent United States of America, NAFTA/UNCITRAL (Nov. 13, 2000); ADF Group Inc. v. United States, Post-Hearing Submission of Respondent United States of America on Article 1105(1) and Pope & Talbot, NAFTA/ICSID Case No. ARB(AF)/00/1 (June 27, 2002); Glamis Gold Ltd. v. United States, Counter-Memorial of Respondent United States of America, NAFTA/UNCITRAL (Sept. 19, 2006); Grand River Enters. v. United States, Counter-Memorial of Respondent United States of America, NAFTA/UNCITRAL (Dec. 22, 2008).

7 See, e.g., Glamis Gold, Ltd. v. United States, NAFTA/UNCITRAL, Award ¦¦ 607-08 (June 8, 2009) (concluding that “arbitral decisions that apply an autonomous standard provide no guidance inasmuch as the entire method of reasoning does not bear on an inquiry into custom”); see also Jurisdictional Immunities of the State (Germany v. Italy: Greece intervening) 2012 I.C.J. ¦ 55 (Judgment of Feb. 3) (“While it may be true that States sometimes decide to accord an immunity more extensive than that required by international law, for present purposes, the point is that the grant of immunity in such a case is not accompanied by the requisite opinio juris and therefore sheds no light upon the issue currently under consideration by the Court.”). 10 See Feldman v. Mexico, NAFTA/ICSID Case No. ARB(AF)/99/1, Award ¦ 177 (Dec. 16, 2002) (“[I]t is a generally accepted canon of evidence in civil law, common law, and in fact, most jurisdictions, that the burden of proof rests upon the party, whether complaining or defending, who asserts the affirmative of a claim or defence.”). 11 S.D. Myers v. Canada, NAFTA/UNCITRAL, First Partial Award ¦ 263 (Nov. 13, 2000).

Resources

Notes

1. Non-disputing Party Submission Under Chapter 11 of the North American Free Trade Agreement in the Digest of United States Practice in International Law