INTERNATIONAL CENTRE FOR SETTLEMENT OF INVESTMENT DISPUTES
ICSID CASE No. ARB(AF)/00/1
INVESTOR�S REPLY TO THE RESPONSE OF THE UNITED STATES
on the issue of the
PLACE OF ARBITRATION
(Chapter 11 - Section B - Article 1130 of the NAFTA; Schedule C - Chapter IV - Article 20 and Article 21 of the ICSID Arbitration (Additional Facility) Rules
I. Brief History of The Submissions to Date
II. Seat of Arbitration and Place of Arbitration
III. Suitability of the Law on Arbitral Procedure of the Place of Arbitration.
IV. Location of the Subject Matter in Dispute
VI. Relative Expense.
Signed at Montreal, this 2nd day of April, 2001
Peter E. Kirby
FASKEN MARTINEAU DuMOULIN LLP
Stock Exchange Tower
Counsel for: ADF Group Inc.
ADF International Inc.
"Section 2 Subsection 2 of the Ontario International Commercial Arbitration Act applies the Model Law only "to international commercial arbitration agreements and award.
Chapter Eleven of the NAFTA, however, is not a commercial arbitration agreement, and given the nature of this dispute � a challenge under international law to measures to protect public health and the environment � an award would not easily lend itself to being characterized as being commercial";
"It is unclear that this provision can be construed to deem Chapter Eleven claims as commercial in contexts other than the two conventions specifically identified, and it far from clear that the claims here could be considered "commercial" for other purposes".
"Section 208 Chapter 1: residual application
Chapter 1 applies to actions and proceedings brought under this chapter to the extent that chapter is not in conflict with this Chapter or the Convention as ratified by the United States".
"Like any other mechanism for resolving controversies, international arbitration will only succeed if it is realistically limited to tasks it is capable of performing well � the prompt and inexpensive resolution of essentially contractual disputes between commercial partners. As for matters involving the political passions and the fundamental interests of nations, even the multilateral convention adopted under the auspices of the United Nations recognises that private international arbitration is incapable of obtaining satisfactory results"(footnotes omitted)
"Under the Convention, "Recognition and enforcement of the award may be refused" if Egypt furnishes to this Court "proof that � [t]he award has � been set aside � by a competent authority of the country in which or under the law of which, that award was made".[Footnotes omitted] In the present case, the award was made in Egypt, under the laws of Egypt, and has been nullified by the court designated by Egypt to review arbitral awards. Thus, the court may, at its discretion decline to enforce the award".
"No nation is under an unremitting obligation to enforce foreign interests which are fundamentally prejudicial to those of the domestic forum".
"When a defendant, as alleged here, has through prescribed acts within our territory, brought itself within the ken of federal securities regulation, a fact not disputed here, those laws � including the controlling principles of Wilko � apply whether the defendant is foreign or American, and whether or not there are trans-national elements in the dealings.
The virtue of certainty in international agreements may be important, but Congress has dictated that when there are sufficient contacts for our securities laws to apply, the policies expressed in those laws take precedence".
"Canada makes two threshold arguments that must be addressed at the outset. It urges (at page 5 of its Memorandum of October 2, 1997) that Article 16(1) of the UNCITRAL Rules �permits the Tribunal to take into account certain general, universally applied considerations which usually are found in the doctrine of forum conveniens�, which "provide that the forum in which to try a matter should be the jurisdiction that has the closest connection with the action and the parties
Leaving aside the issue as to whether that municipal law doctrine has a place in international arbitration, the Tribunal is constrained to say that in its view its decision regarding the place of arbitration in this case must be made, as Article 16(1) prescribes, �having regard to the circumstances of the arbitration�, meaning all such circumstances �".
[emphasis in the original]
V. The Convenience of the Parties.
BY TELECOPIER: 202-522-2615
Mr. Alejandro A. Escobar
Secretary of the Tribunal
International Centre for Settlement of Investment Disputes
1818 H. Streeet N.W.
Washington, D.C., USA
BY TELECOPIER: 202-776-8388
United States of America
c/o Mr. Barton Legum
United States Department of State
Office of the Legal Advisor
2430 E Street N.W., Suite 203, South Building
Washington, D. C., USA
Judge Florentino P. Feliciano - President
Professor Armand de Mestral
Ms. Carolyn B. Lamm.