Big Blue Marble

“The body is a sacred garment.”

Martha Graham

FAST FACTS ON NAFTA—CHAPTER 11

Excerpted From: http://www.planetagenda.com/nafta%20chapter%2011%20liabilities.htm

• The North American Free Trade Agreement was signed in 1992 and governs trade between the U.S., Canada and Mexico.
• Chapter 11 of the agreement allows private companies to sue federal governments covered under NAFTA over policies that "expropriate" their profits.
• Chapter 11 has two sections: Section A sets out the three countries’ obligations to foreign investors and Section B outlines a dispute resolution system that private investors can initiate if they feel a foreign government violated one of those obligations. The dispute resolution system is known as the "investor-state process."
• Between one-third and one-half of all private investment in developing countries comes from foreign companies, providing much-needed capital. Chapter 11 was designed to help reduce the risk of investing in foreign economies.
• The U.S. government called Chapter 11 an "historic investor-state mechanism" that would liberalize Mexican trade policies and protect U.S. companies that felt Mexico imposed unfavourable constraints on foreign investment. Mexico saw it as a way to attract foreign investment and improve its economy.
• Chapter 11 embodies the strongest rights and remedies ever granted to foreign investors in an international agreement.
• The process allows foreign investors to bypass a country’s domestic court system and use independent arbitrators instead. This gives foreign investors remedies unavailable to domestic investors, but also eliminates the appeals process.
• Each side -- the investor and the government -- chooses one arbitrator and a third arbitrator is negotiated or chosen from a list of arbitrators by a neutral party.
• At least 12 lawsuits have been filed by companies under Chapter 11 provisions since NAFTA was signed in 1992. Seven of those have arisen because of environmental laws. (There may be more than 12 that aren’t known about publicly because of the secrecy of Chapter 11 proceedings.