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Scientific
Information: Cater, Stephen R., (2000). Reducing the Threat of MTBE-Contaminated Groundwater. Pollution Engineering, May, pages 37-39. Erdal, Serap and Bernard D. Goldstein, (2000). Methyl tert-butyl Ether as a Gasoline Oxygenate: Lessons for Environmental Policy. Annual Review Energy & The Environment 2000. 25: 765-802. Gullick, Richard W. and Mark W. LeChevallier, (1999). Occurrence of MTBE in Drinking Water Sources. American Water Works Company, Inc. Submitted to Journal American Water Works Association, New Jersey. Melin, Gina, ed. (2000). Treatment Technologies for Removal of MTBE from Drinking Water. A Report written for the California MTBE Research Partnership. University of California at Davis, (1998). Health and Environmental Assessment of MTBE; Report to the Governor and the Legislature of the State of California. (Nov 12). Summary and complete report available at http://tsrtp.ucdavis.edu/mtberpt Annex 1:
(Selected) Text of NAFTA Chapter 11 North
American Free Trade Agreement PART FIVE: INVESTMENT, SERVICES AND RELATED MATTERS Chapter Eleven: Investment Section
A - Investment Article
1101: Scope and Coverage (The following sections
not included here due to space considerations, but are available at http://www.nafta-sec-alena.org/
) Section B - Settlement of Disputes between a Party and an Investor of Another Party Article 1115:
Purpose Section C - Definitions
Section A -
Investment Article 1101: Scope and Coverage 1. This Chapter applies to
measures adopted or maintained by a Party relating to: 2. A Party has the right
to perform exclusively the economic activities set out in Annex III and
to refuse to permit the establishment of investment in such activities. 3. This Chapter does not
apply to measures adopted or maintained by a Party to the extent that
they are covered by Chapter Fourteen (Financial Services). 4. Nothing in this Chapter shall be construed to prevent a Party from providing a service or performing a function such as law enforcement, correctional services, income security or insurance, social security or insurance, social welfare, public education, public training, health, and child care, in a manner that is not inconsistent with this Chapter. Article 1102: National Treatment 1. Each Party shall accord
to investors of another Party treatment no less favorable than that it
accords, in like circumstances, to its own investors with respect to the
establishment, acquisition, expansion, management, conduct, operation,
and sale or other disposition of investments. 2. Each Party shall accord
to investments of investors of another Party treatment no less favorable
than that it accords, in like circumstances, to investments of its own
investors with respect to the establishment, acquisition, expansion,
management, conduct, operation, and sale or other disposition of
investments. 3. The treatment accorded
by a Party under paragraphs 1 and 2 means, with respect to a state or
province, treatment no less favorable than the most favorable treatment
accorded, in like circumstances, by that state or province to investors,
and to investments of investors, of the Party of which it forms a part. 4. For greater certainty, no Party may: (a) impose on an investor of another Party a requirement that a minimum level of equity in an enterprise in the territory of the Party be held by its nationals, other than nominal qualifying shares for directors or incorporators of corporations; or (b) require an investor of another Party, by reason of its nationality, to sell or otherwise dispose of an investment in the territory of the Party. Article 1103: Most-Favored-Nation Treatment 1. Each Party shall accord
to investors of another Party treatment no less favorable than that it
accords, in like circumstances, to investors of any other Party or of a
non-Party with respect to the establishment, acquisition, expansion,
management, conduct, operation, and sale or other disposition of
investments. 2. Each Party shall accord to investments of investors of another Party treatment no less favorable than that it accords, in like circumstances, to investments of investors of any other Party or of a non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments. Article 1104: Standard of Treatment Each Party shall accord to investors of another Party and to investments of investors of another Party the better of the treatment required by Articles 1102 and 1103. Article 1105: Minimum Standard of Treatment 1. Each Party shall accord to investments of investors of another Party treatment in accordance with international law, including fair and equitable treatment and full protection and security. 2. Without prejudice to paragraph 1 and notwithstanding Article 1108(7)(b), each Party shall accord to investors of another Party, and to investments of investors of another Party, non-discriminatory treatment with respect to measures it adopts or maintains relating to losses suffered by investments in its territory owing to armed conflict or civil strife. 3. Paragraph 2 does not apply to existing measures relating to subsidies or grants that would be inconsistent with Article 1102 but for Article 1108(7)(b). Article
1106: Performance Requirements 1. No Party may impose or enforce any of the following requirements, or enforce any commitment or undertaking, in connection with the establishment, acquisition, expansion, management, conduct or operation of an investment of an investor of a Party or of a non-Party in its territory: (a) to export a given level or percentage of goods or services; (b) to achieve a given level or percentage of domestic content; (c) to purchase, use or accord a preference to goods produced or services provided in its territory, or to purchase goods or services from persons in its territory; (d) to relate in any way the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with such investment; (e) to restrict sales of goods or services in its territory that such investment produces or provides by relating such sales in any way to the volume or value of its exports or foreign exchange earnings; (f) to transfer technology, a production process or other proprietary knowledge to a person in its territory, except when the requirement is imposed or the commitment or undertaking is enforced by a court, administrative tribunal or competition authority to remedy an alleged violation of competition laws or to act in a manner not inconsistent with other provisions of this Agreement; or (g) to act as the exclusive supplier of the
goods it produces or services it provides to a specific region or world
market. 2. A measure that requires
an investment to use a technology to meet generally applicable health,
safety or environmental requirements shall not be construed to be
inconsistent with paragraph 1(f). For greater certainty, Articles 1102
and 1103 apply to the measure. 3. No Party may condition the receipt or continued receipt of an advantage, in connection with an investment in its territory of an investor of a Party or of a non-Party, on compliance with any of the following requirements: (a) to achieve a given level or percentage of domestic content; (b) to purchase, use or accord a preference to goods produced in its territory, or to purchase goods from producers in its territory; (c) to relate in any way the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with such investment; or (d) to restrict sales of goods or services
in its territory that such investment produces or provides by relating
such sales in any way to the volume or value of its exports or foreign
exchange earnings. 4. Nothing in paragraph 3
shall be construed to prevent a Party from conditioning the receipt or
continued receipt of an advantage, in connection with an investment in
its territory of an investor of a Party or of a non-Party, on compliance
with a requirement to locate production, provide a service, train or
employ workers, construct or expand particular facilities, or carry out
research and development, in its territory. 5. Paragraphs 1 and 3 do not apply to any requirement other than the requirements set out in those paragraphs. 6. Provided that such measures are not applied in an arbitrary or unjustifiable manner, or do not constitute a disguised restriction on international trade or investment, nothing in paragraph 1(b) or (c) or 3(a) or (b) shall be construed to prevent any Party from adopting or maintaining measures, including environmental measures: (a) necessary to secure compliance with laws and regulations that are not inconsistent with the provisions of this Agreement; (b) necessary to protect human, animal or plant life or health; or (c) necessary for the conservation of living or non-living exhaustible natural resources. Article
1107: Senior Management and Boards of Directors 1. No Party may require
that an enterprise of that Party that is an investment of an investor of
another Party appoint to senior management positions individuals of any
particular nationality. 2. A Party may require that a majority of the board of directors, or any committee thereof, of an enterprise of that Party that is an investment of an investor of another Party, be of a particular nationality, or resident in the territory of the Party, provided that the requirement does not materially impair the ability of the investor to exercise control over its investment. Article
1108: Reservations and Exceptions 1. Articles 1102, 1103, 1106 and 1107 do not apply to: (a) any existing non-conforming measure that is maintained by (i) a Party at the federal level, as set out in its Schedule to Annex I or III, (ii) a state or province, for two years after the date of entry into force of this Agreement, and thereafter as set out by a Party in its Schedule to Annex I in accordance with paragraph 2, or (iii) a local government; (b) the continuation or prompt renewal of any non-conforming measure referred to in subparagraph (a); or (c) an amendment to any non-conforming
measure referred to in subparagraph (a) to the extent that the amendment
does not decrease the conformity of the measure, as it existed
immediately before the amendment, with Articles 1102, 1103, 1106 and
1107. 2. Each Party may set out
in its Schedule to Annex I, within two years of the date of entry into
force of this Agreement, any existing nonconforming measure maintained
by a state or province, not including a local government. 3. Articles 1102, 1103,
1106 and 1107 do not apply to any measure that a Party adopts or
maintains with respect to sectors, subsectors or activities, as set out
in its Schedule to Annex II. 4. No Party may, under any measure adopted after the date of entry into force of this Agreement and covered by its Schedule to Annex II, require an investor of another Party, by reason of its nationality, to sell or otherwise dispose of an investment existing at the time the measure becomes effective. 5. Articles 1102 and 1103
do not apply to any measure that is an exception to, or derogation from,
the obligations under Article 1703 (Intellectual Property National
Treatment) as specifically provided for in that Article. 6. Article 1103 does not
apply to treatment accorded by a Party pursuant to agreements, or with
respect to sectors, set out in its Schedule to Annex IV. 7. Articles 1102, 1103 and 1107 do not apply to: (a) procurement by a Party or a state enterprise; or (b) subsidies or grants provided by a Party
or a state enterprise, including government supported loans, guarantees
and insurance. 8. The provisions of: (a) Article 1106(1)(a), (b) and (c), and (3)(a) and (b) do not apply to qualification requirements for goods or services with respect to export promotion and foreign aid programs; (b) Article 1106(1)(b), (c), (f) and (g), and (3)(a) and (b) do not apply to procurement by a Party or a state enterprise; and (c) Article 1106(3)(a) and (b) do not apply to requirements imposed by an importing Party relating to the content of goods necessary to qualify for preferential tariffs or preferential quotas. Article 1109: Transfers 1. Each Party shall permit all transfers relating to an investment of an investor of another Party in the territory of the Party to be made freely and without delay. Such transfers include: (a) profits, dividends, interest, capital gains, royalty payments, management fees, technical assistance and other fees, returns in kind and other amounts derived from the investment; (b) proceeds from the sale of all or any part of the investment or from the partial or complete liquidation of the investment; (c) payments made under a contract entered into by the investor, or its investment, including payments made pursuant to a loan agreement; (d) payments made pursuant to Article 1110; and (e) payments arising under Section B. 2. Each Party shall permit
transfers to be made in a freely usable currency at the market rate of
exchange prevailing on the date of transfer with respect to spot
transactions in the currency to be transferred. 3. No Party may require
its investors to transfer, or penalize its investors that fail to
transfer, the income, earnings, profits or other amounts derived from,
or attributable to, investments in the territory of another Party. 4. Notwithstanding paragraphs 1 and 2, a Party may prevent a transfer through the equitable, non-discriminatory and good faith application of its laws relating to: (a) bankruptcy, insolvency or the protection of the rights of creditors; (b) issuing, trading or dealing in securities; (c) criminal or penal offenses; (d) reports of transfers of currency or other monetary instruments; or (e) ensuring the satisfaction of judgments in adjudicatory proceedings. 5. Paragraph 3 shall not
be construed to prevent a Party from imposing any measure through the
equitable, non-discriminatory and good faith application of its laws
relating to the matters set out in subparagraphs (a)through (e) of
paragraph 4. 6. Notwithstanding paragraph 1, a Party may restrict transfers of returns in kind in circumstances where it could otherwise restrict such transfers under this Agreement, including as set out in paragraph 4. Article
1110: Expropriation and Compensation 1. No Party may directly or indirectly nationalize or expropriate an investment of an investor of another Party in its territory or take a measure tantamount to nationalization or expropriation of such an investment ("expropriation"), except: (a) for a public purpose; (b) on a non-discriminatory basis; (c) in accordance with due process of law and Article 1105(1); and (d) on payment of compensation in
accordance with paragraphs 2 through 6. 2. Compensation shall be
equivalent to the fair market value of the expropriated investment
immediately before the expropriation took place ("date of
expropriation"), and shall not reflect any change in value
occurring because the intended expropriation had become known earlier.
Valuation criteria shall include going concern value, asset value
including declared tax value of tangible property, and other criteria,
as appropriate, to determine fair market value. 3. Compensation shall be
paid without delay and be fully realizable. 4. If payment is made in a
G7 currency, compensation shall include interest at a commercially
reasonable rate for that currency from the date of expropriation until
the date of actual payment. 5. If a Party elects to
pay in a currency other than a G7 currency, the amount paid on the date
of payment, if converted into a G7 currency at the market rate of
exchange prevailing on that date, shall be no less than if the amount of
compensation owed on the date of expropriation had been converted into
that G7 currency at the market rate of exchange prevailing on that date,
and interest had accrued at a commercially reasonable rate for that G7
currency from the date of expropriation until the date of payment. 6. On payment,
compensation shall be freely transferable as provided in Article 1109. 7. This Article does not
apply to the issuance of compulsory licenses granted in relation to
intellectual property rights, or to the revocation, limitation or
creation of intellectual property rights, to the extent that such
issuance, revocation, limitation or creation is consistent with Chapter
Seventeen (Intellectual Property). 8. For purposes of this Article and for greater certainty, a non-discriminatory measure of general application shall not be considered a measure tantamount to an expropriation of a debt security or loan covered by this Chapter solely on the ground that the measure imposes costs on the debtor that cause it to default on the debt. Article 1111: Special Formalities and Information Requirements 1. Nothing in Article 1102 shall be construed to prevent a Party from adopting or maintaining a measure that prescribes special formalities in connection with the establishment of investments by investors of another Party, such as a requirement that investors be residents of the Party or that investments be legally constituted under the laws or regulations of
the Party, provided that such formalities do not materially impair the
protections afforded by a Party to investors of another Party and
investments of investors of another Party pursuant to this Chapter. 2. Notwithstanding Articles 1102 or 1103, a Party may require an investor of another Party, or its investment in its territory, to provide routine information concerning that investment solely for informational or statistical purposes. The Party shall protect such business information that is confidential from any disclosure that would prejudice the competitive position of the investor or the investment. Nothing in this paragraph shall be construed to prevent a Party from otherwise obtaining or disclosing information in connection with the equitable and good faith application of its law. Article
1112: Relation to Other Chapters 1. In the event of any
inconsistency between this Chapter and another Chapter, the other
Chapter shall prevail to the extent of the inconsistency. 2. A requirement by a Party that a service provider of another Party post a bond or other form of financial security as a condition of providing a service into its territory does not of itself make this Chapter applicable to the provision of that crossborder service. This Chapter applies to that Party's treatment of the posted bond or financial security. Article
1113: Denial of Benefits 1. A Party may deny the benefits of this Chapter to an investor of another Party that is an enterprise of such Party and to investments of such investor if investors of a non-Party own or control the enterprise and the denying Party: (a) does not maintain diplomatic relations with the non-Party; or (b) adopts or maintains measures with
respect to the non-Party that prohibit transactions with the enterprise
or that would be violated or circumvented if the benefits of this
Chapter were accorded to the enterprise or to its investments. 2. Subject to prior notification and consultation in accordance with Articles 1803 (Notification and Provision of Information) and 2006 (Consultations), a Party may deny the benefits of this Chapter to an investor of another Party that is an enterprise of such Party and to investments of such investors if investors of a non-Party own or control the enterprise and the enterprise has no substantial business activities in the territory of the Party under whose law it is constituted or organized. Article
1114: Environmental Measures 1. Nothing in this Chapter
shall be construed to prevent a Party from adopting, maintaining or
enforcing any measure otherwise consistent with this Chapter that it
considers appropriate to ensure that investment activity in its
territory is undertaken in a manner sensitive to environmental concerns. 2. The Parties recognize
that it is inappropriate to encourage investment by relaxing domestic
health, safety or environmental measures. Accordingly, a Party should
not waive or otherwise derogate from, or offer to waive or otherwise
derogate from, such measures as an encouragement for the establishment,
acquisition, expansion or retention in its territory of an investment of
an investor. If a Party considers that another Party has offered such an
encouragement, it may request consultations with the other Party and the
two Parties shall consult with a view to avoiding any such
encouragement. |