Influences on the Canadian FIPA Model and the US Model BIT: NAFTA Chapter 11 and Beyond

Abstract

SummaryIn recent years, Canada and the United States have modified their model bilateral investment treaties (BITs). If NAFTA Chapter 11 cases have provided the new lens through which investment issues are considered, the solutions to problems experienced in this context have come from different sources. This article explores three influences on the model BITs: the NAFTA Free Trade Commission's interpretation and statements, World Trade Organization law and cases, and US domestic law and principles. A range of interpretation issues is raised, from the effects of changes in wording in successive treaties, to the “transferability” of law across systems (international and domestic), to the use of arbitral awards as precedent. Issues of a systemic nature are also raised, including attempts at limiting the discretion of arbitral tribunals through state interpretations, the possibility of creating an appellate mechanism, and a push for expedited preliminary procedures. The article illustrates the fast-paced evolution of international investment law and highlights the influence of the United States on this evolution.