Article 1121: Conditions Precedent to Submission of a Claim
to Arbitration
1. A disputing investor may submit a claim under Article 1116 to arbitration only if:
(b) the investor and, where the claim is for loss or damage to an interest in an enterprise of another Party that is a juridical person that the investor owns or controls directly or indirectly, the enterprise, waive their right to initiate or continue before any administrative tribunal or court under the law of any Party, or other dispute settlement procedures, any proceedings with respect to the measure of the disputing Party that is alleged to be a breach referred to in Article 1116, except for proceedings for injunctive, declaratory or other extraordinary relief, not involving the payment of damages, before an administrative tribunal or court under the law of the disputing Party.
2. A disputing investor may submit a claim under Article 1117 to arbitration only if both the investor and the enterprise:
(b) waive their right to initiate or continue before any administrative tribunal or court under the law of any Party, or other dispute settlement procedures, any proceedings with respect to the measure of the disputing Party that is alleged to be a breach referred to in Article 1117, except for proceedings for injunctive, declaratory or other extraordinary relief, not involving the payment of damages, before an administrative tribunal or court under the law of the disputing Party.
3. A consent and waiver required by this Article shall be in writing, shall be delivered to the disputing Party and shall be included in the submission of a claim to arbitration.
4. Only where a disputing Party has deprived a disputing investor of control of an enterprise:
(b) Annex 1120.1(b) shall not apply.
1. Each Party consents to the submission of a claim to arbitration
in accordance with the procedures set out in this Agreement.
2. The consent given by paragraph 1 and the submission by a disputing
investor of a claim to arbitration shall satisfy the requirement
of:
(b) Article II of the New York Convention for an agreement in
writing; and
(c) Article I of the InterAmerican Convention for an agreement.
Except in respect of a Tribunal established under Article 1126,
and unless the disputing parties otherwise agree, the Tribunal
shall comprise three arbitrators, one arbitrator appointed by
each of the disputing parties and the third, who shall be the
presiding arbitrator, appointed by agreement of the disputing
parties.
1. The Secretary-General shall serve as appointing authority for
an arbitration under this Section.
2. If a Tribunal, other than a Tribunal established under Article
1126, has not been constituted within 90 days from the date that
a claim is submitted to arbitration, the Secretary-General, on
the request of either disputing party, shall appoint, in his discretion,
the arbitrator or arbitrators not yet appointed, except that the
presiding arbitrator shall be appointed in accordance with paragraph
3.
3. The Secretary-General shall appoint the presiding arbitrator
from the roster of presiding arbitrators referred to in paragraph
4, provided that the presiding arbitrator shall not be a national
of the disputing Party or a national of the Party of the disputing
investor. In the event that no such presiding arbitrator is available
to serve, the Secretary-General shall appoint, from the ICSID Panel
of Arbitrators, a presiding arbitrator who is not a national of
any of the Parties.
4. On the date of entry into force of this Agreement, the Parties
shall establish, and thereafter maintain, a roster of 45 presiding
arbitrators meeting the qualifications of the Convention and rules
referred to in Article 1120 and experienced in international law
and investment matters. The roster members shall be appointed
by consensus and without regard to nationality.
For purposes of Article 39 of the ICSID Convention and Article
7 of Schedule C to the ICSID Additional Facility Rules, and without
prejudice to an objection to an arbitrator based on Article 1124(3)
or on a ground other than nationality:
(b) a disputing investor referred to in Article 1116 may submit
a claim to arbitration, or continue a claim, under the ICSID Convention
or the ICSID Additional Facility Rules, only on condition that
the disputing investor agrees in writing to the appointment of
each individual member of the Tribunal; and
(c) a disputing investor referred to in Article 1117(1) may submit
a claim to arbitration, or continue a claim, under the ICSID Convention
or the ICSID Additional Facility Rules, only on condition that
the disputing investor and the enterprise agree in writing to
the appointment of each individual member of the Tribunal.
1. A Tribunal established under this Article shall be established
under the UNCITRAL Arbitration Rules and shall conduct its proceedings
in accordance with those Rules, except as modified by this Section.
2. Where a Tribunal established under this Article is satisfied
that claims have been submitted to arbitration under Article 1120
that have a question of law or fact in common, the Tribunal may,
in the interests of fair and efficient resolution of the claims,
and after hearing the disputing parties, by order:
(b) assume jurisdiction over, and hear and determine one or more
of the claims, the determination of which it believes would assist
in the resolution of the others.
3. A disputing party that seeks an order under paragraph 2 shall
request the Secretary-General to establish a Tribunal and shall
specify in the request:
(b) the nature of the order sought; and
(c) the grounds on which the order is sought.
4. The disputing party shall deliver to the disputing Party or
disputing investors against which the order is sought a copy of
the request.
5. Within 60 days of receipt of the request, the Secretary-General
shall establish a Tribunal comprising three arbitrators. The Secretary-General
shall appoint the presiding arbitrator from the roster referred
to in Article 1124(4). In the event that no such presiding arbitrator
is available to serve, the Secretary-General shall appoint, from
the ICSID Panel of Arbitrators, a presiding arbitrator who is
not a national of any of the Parties. The Secretary-General shall
appoint the two other members from the roster referred to in Article
1124(4), and to the extent not available from that roster, from
the ICSID Panel of Arbitrators, and to the extent not available
from that Panel, in the discretion of the Secretary-General. One
member shall be a national of the disputing Party and one member
shall be a national of a Party of the disputing investors.
6. Where a Tribunal has been established under this Article, a
disputing investor that has submitted a claim to arbitration under
Article 1116 or 1117 and that has not been named in a request
made under paragraph 3 may make a written request to the Tribunal
that it be included in an order made under paragraph 2, and shall
specify in the request:
(b) the nature of the order sought; and
(c) the grounds on which the order is sought.
7. A disputing investor referred to in paragraph 6 shall deliver
a copy of its request to the disputing parties named in a request
made under paragraph 3.
8. A Tribunal established under Article 1120 shall not have jurisdiction
to decide a claim, or a part of a claim, over which a Tribunal
established under this Article has assumed jurisdiction.
9. On application of a disputing party, a Tribunal established
under this Article, pending its decision under paragraph 2, may
order that the proceedings of a Tribunal established under Article
1120 be stayed, unless the latter Tribunal has already adjourned
its proceedings.
10. A disputing Party shall deliver to the Secretariat, within
15 days of receipt by the disputing Party, a copy of:
(b) a notice of arbitration made under Article 2 of Schedule C
of the ICSID Additional Facility Rules; or
(c) a notice of arbitration given under the UNCITRAL Arbitration
Rules.
11. A disputing Party shall deliver to the Secretariat a copy
of a request made under paragraph 3:
(b) within 15 days of making the request, in the case of a request
made by the disputing Party.
13. The Secretariat shall maintain a public register of the documents
referred to in paragraphs 10, 11 and 12.
A disputing Party shall deliver to the other Parties:
(b) copies of all pleadings filed in the arbitration.
On written notice to the disputing parties, a Party may make submissions
to a Tribunal on a question of interpretation of this Agreement.
1. A Party shall be entitled to receive from the disputing Party,
at the cost of the requesting Party a copy of:
(b) the written argument of the disputing parties.
2. A Party receiving information pursuant to paragraph 1 shall
treat the information as if it were a disputing Party.
Unless the disputing parties agree otherwise, a Tribunal shall
hold an arbitration in the territory of a Party that is a party
to the New York Convention, selected in accordance with:
(b) the UNCITRAL Arbitration Rules if the arbitration is under
those Rules.
1. A Tribunal established under this Section shall decide the
issues in dispute in accordance with this Agreement and applicable
rules of international law.
2. An interpretation by the Commission of a provision of this
Agreement shall be binding on a Tribunal established under this
Section.
1. Where a disputing Party asserts as a defense that the measure
alleged to be a breach is within the scope of a reservation or
exception set out in Annex I, Annex II, Annex III or Annex IV,
on request of the disputing Party, the Tribunal shall request
the interpretation of the Commission on the issue. The Commission,
within 60 days of delivery of the request, shall submit in writing
its interpretation to the Tribunal.
2. Further to Article 1131(2), a Commission interpretation submitted
under paragraph 1 shall be binding on the Tribunal. If the Commission
fails to submit an interpretation within 60 days, the Tribunal
shall decide the issue.
Without prejudice to the appointment of other kinds of experts
where authorized by the applicable arbitration rules, a Tribunal,
at the request of a disputing party or, unless the disputing parties
disapprove, on its own initiative, may appoint one or more experts
to report to it in writing on any factual issue concerning environmental,
health, safety or other scientific matters raised by a disputing
party in a proceeding, subject to such terms and conditions as
the disputing parties may agree.
A Tribunal may order an interim measure of protection to preserve
the rights of a disputing party, or to ensure that the Tribunal's
jurisdiction is made fully effective, including an order to preserve
evidence in the possession or control of a disputing party or
to protect the Tribunal's jurisdiction. A Tribunal may not order
attachment or enjoin the application of the measure alleged to
constitute a breach referred to in Article 1116 or 1117. For purposes
of this paragraph, an order includes a recommendation.
1. Where a Tribunal makes a final award against a Party, the Tribunal
may award, separately or in combination, only:
(b) restitution of property, in which case the award shall provide
that the disputing Party may pay monetary damages and any applicable
interest in lieu of restitution.
A tribunal may also award costs in accordance with the applicable
arbitration rules.
2. Subject to paragraph 1, where a claim is made under Article
1117(1):
(b) an award of monetary damages and any applicable interest shall
provide that the sum be paid to the enterprise; and
(c) the award shall provide that it is made without prejudice
to any right that any person may have in the relief under applicable
domestic law.
3. A Tribunal may not order a Party to pay punitive damages.
1. An award made by a Tribunal shall have no binding force except
between the disputing parties and in respect of the particular
case.
2. Subject to paragraph 3 and the applicable review procedure
for an interim award, a disputing party shall abide by and comply
with an award without delay.
3. A disputing party may not seek enforcement of a final award
until:
(ii) revision or annulment proceedings have been completed; and
(b) in the case of a final award under the ICSID Additional Facility
Rules or the UNCITRAL Arbitration Rules
(ii) a court has dismissed or allowed an application to revise,
set aside or annul the award and there is no further appeal.
4. Each Party shall provide for the enforcement of an award in
its territory.
5. If a disputing Party fails to abide by or comply with a final
award, the Commission, on delivery of a request by a Party whose
investor was a party to the arbitration, shall establish a panel
under Article 2008 (Request for an Arbitral Panel). The requesting
Party may seek in such proceedings:
(b) a recommendation that the Party abide by or comply with the
final award.
6. A disputing investor may seek enforcement of an arbitration
award under the ICSID Convention, the New York Convention or the
InterAmerican Convention regardless of whether proceedings have
been taken under paragraph 5.
7. A claim that is submitted to arbitration under this Section
shall be considered to arise out of a commercial relationship
or transaction for purposes of Article I of the New York Convention
and Article I of the InterAmerican Convention.
Time when a Claim is Submitted to Arbitration
1. A claim is submitted to arbitration under this Section when:
(b) the notice of arbitration under Article 2 of Schedule C of
the ICSID Additional Facility Rules has been received by the Secretary-General;
or
(c) the notice of arbitration given under the UNCITRAL Arbitration
Rules is received by the disputing Party.
Service of Documents
2. Delivery of notice and other documents on a Party shall be
made to the place named for that Party in Annex 1137.2.
Receipts under Insurance or Guarantee Contracts
3. In an arbitration under this Section, a Party shall not assert,
as a defense, counterclaim, right of setoff or otherwise, that
the disputing investor has received or will receive, pursuant
to an insurance or guarantee contract, indemnification or other
compensation for all or part of its alleged damages.
Publication of an Award
4. Annex 1137.4 applies to the Parties specified in that Annex
with respect to publication of an award.
1. Without prejudice to the applicability or non-applicability
of the dispute settlement provisions of this Section or of Chapter
Twenty (Institutional Arrangements and Dispute Settlement Procedures)
to other actions taken by a Party pursuant to Article 2102 (National
Security), a decision by a Party to prohibit or restrict the acquisition
of an investment in its territory by an investor of another Party,
or its investment, pursuant to that Article shall not be subject
to such provisions.
2. The dispute settlement provisions of this Section and of Chapter
Twenty shall not apply to the matters referred to in Annex 1138.2.
For purposes of this Chapter:
disputing investor means an investor that makes a claim
under Section B;
disputing parties means the disputing investor and the
disputing Party;
disputing party means the disputing investor or the disputing
Party;
disputing Party means a Party against which a claim is
made under Section B;
enterprise means an "enterprise" as defined in
Article 201 (Definitions of General Application), and a branch
of an enterprise;
enterprise of a Party means an enterprise constituted or
organized under the law of a Party, and a branch located in the
territory of a Party and carrying out business activities there.
equity or debt securities includes voting and non-voting
shares, bonds, convertible debentures, stock options and warrants;
G7 Currency means the currency of Canada, France, Germany,
Italy, Japan, the United Kingdom of Great Britain and Northern
Ireland or the United States;
ICSID means the International Centre for Settlement of
Investment Disputes;
ICSID Convention means the Convention on the Settlement
of Investment Disputes between States and Nationals of other States,
done at Washington, March 18, 1965;
InterAmerican Convention means the InterAmerican Convention
on International Commercial Arbitration, done at Panama, January
30, 1975;
investment means:
(b) an equity security of an enterprise;
(c) a debt security of an enterprise
(ii) where the original maturity of the debt security is at least
three years,
but does not include a debt security, regardless
of original maturity, of a state enterprise;
(d) a loan to an enterprise
(ii) where the original maturity of the loan is at least three
years,
but does not include a loan, regardless of original maturity,
to a state enterprise;
(e) an interest in an enterprise that entitles the owner to share
in income or profits of the enterprise;
(f) an interest in an enterprise that entitles the owner to share
in the assets of that enterprise on dissolution, other than a
debt security or a loan excluded from subparagraph (c) or (d);
(g) real estate or other property, tangible or intangible, acquired
in the expectation or used for the purpose of economic benefit
or other business purposes; and
(h) interests arising from the commitment of capital or other
resources in the territory of a Party to economic activity in
such territory, such as under
(ii) contracts where remuneration depends substantially on the
production, revenues or profits of an enterprise;
but investment does not mean,
(ii) the extension of credit in connection with a commercial transaction,
such as trade financing, other than a loan covered by subparagraph
(d); or
(j) any other claims to money,
that do not involve the kinds of interests set out in subparagraphs
(a) through (h);
investment of an investor of a Party means an investment
owned or controlled directly or indirectly by an investor of such
Party;
investor of a Party means a Party or state enterprise thereof,
or a national or an enterprise of such Party, that seeks to make,
is making or has made an investment;
investor of a non-Party means an investor other than an
investor of a Party, that seeks to make, is making or has made
an investment;
New York Convention means the United Nations Convention
on the Recognition and Enforcement of Foreign Arbitral Awards,
done at New York, June 10, 1958;
Secretary-General means the Secretary-General of ICSID;
transfers means transfers and international payments;
Tribunal means an arbitration tribunal established under
Article 1120 or 1126; and
UNCITRAL Arbitration Rules means the arbitration rules
of the United Nations Commission on International Trade Law, approved
by the United Nations General Assembly on December 15, 1976.
Submission of a Claim to Arbitration
With respect to the submission of a claim to arbitration:
(ii) Article 1502(3)(a) (Monopolies and State Enterprises) where
the monopoly has acted in a manner inconsistent with the Party's
obligations under Section A,
both in an arbitration under this
Section and in proceedings before a Mexican court or administrative
tribunal; and
(b) where an enterprise of Mexico that is a juridical person that
an investor of another Party owns or controls directly or indirectly
alleges in proceedings before a Mexican court or administrative
tribunal that Mexico has breached an obligation under:
(ii) Article 1502(3)(a) (Monopolies and State Enterprises) where
the monopoly has acted in a manner inconsistent with the Party's
obligations under Section A,
the investor may not allege the breach in an arbitration under this Section.
Service of Documents on a Party Under Section B
Each Party shall set out in this Annex and publish in its official
journal by January 1, 1994, the place for delivery of notice and
other documents under this Section.
Article 1122: Consent to Arbitration
(a) Chapter II of the ICSID Convention (Jurisdiction of the Centre)
and the Additional Facility Rules for written consent of the parties;
Article 1123: Number of Arbitrators and Method of Appointment
Article 1124: Constitution of a Tribunal
When a Party Fails to Appoint an Arbitrator or the Disputing Parties
Are Unable to Agree on a Presiding Arbitrator
Article 1125: Agreement to Appointment of Arbitrators
(a) the disputing Party agrees to the appointment of each individual
member of a Tribunal established under the ICSID Convention or
the ICSID Additional Facility Rules;
Article 1126: Consolidation
(a) assume jurisdiction over, and hear and determine together,
all or part of the claims; or
(a) the name of the disputing Party or disputing investors against
which the order is sought;
(a) the name and address of the disputing investor;
(a) a request for arbitration made under paragraph (1) of Article
36 of the ICSID Convention;
(a) within 15 days of receipt of the request, in the case of a
request made by a disputing investor;
12. A disputing Party shall deliver to the Secretariat a copy
of a request made under paragraph 6 within 15 days of receipt
of the request.
Article 1127: Notice
(a) written notice of a claim that has been submitted to arbitration
no later than 30 days after the date that the claim is submitted;
and
Article 1128: Participation by a Party
Article 1129: Documents
(a) the evidence that has been tendered to the Tribunal; and
Article 1130: Place of Arbitration
(a) the ICSID Additional Facility Rules if the arbitration is
under those Rules or the ICSID Convention; or
Article 1131: Governing Law
Article 1132: Interpretation of Annexes
Article 1133: Expert Reports
Article 1134: Interim Measures of Protection
Article 1135: Final Award
(a) monetary damages and any applicable interest;
(a) an award of restitution of property shall provide that restitution
be made to the enterprise;
Article 1136: Finality and Enforcement of an Award
(a) in the case of a final award made under the ICSID Convention
(i) 120 days have elapsed from the date the award was rendered
and no disputing party has requested revision or annulment of
the award, or
(i) three months have elapsed from the date the award was rendered
and no disputing party has commenced a proceeding to revise, set
aside or annul the award, or
(a) a determination that the failure to abide by or comply with
the final award is inconsistent with the obligations of this Agreement;
and
Article 1137: General
(a) the request for arbitration under paragraph (1) of Article
36 of the ICSID Convention has been received by the Secretary-General;
Article 1138: Exclusions
Article 1139: Definitions
(a) an enterprise;
(i) where the enterprise is an affiliate of the investor, or
(i) where the enterprise is an affiliate of the investor, or
(i) contracts involving the presence of an investor's property
in the territory of the Party, including turnkey or construction
contracts, or concessions, or
(i) claims to money that arise solely from
(i) commercial contracts for the sale of goods or services by
a national or enterprise in the territory of a Party to an enterprise
in the territory of another Party, or
Annex 1120.1
(a) an investor of another Party may not allege that Mexico has
breached an obligation under:
(i) Section A or Article 1503(2) (State Enterprises), or
(i) Section A or Article 1503(2) (State Enterprises), or
Annex 1137.2