Submission of Non-Disputing Parties Bluewater Network, Communities for a Better Environment, and Center for International Environmental Law [In the Arbitration under Chapter Eleven of the North America Free Trade Agreement and the UNCITRAL Arbitration Rules between Methanex Corporation and the United States of America] (March 2004)

Click to read
Click to read

In a series of actions beginning in 1997, the State of California banned the use of the gasoline additive MTBE, citing concerns that the additive had contaminated the state’s freshwater resources and jeopardized human health. Pursuant to NAFTA’s Chapter 11, the Methanex Corporation, a Canadian Corporation that manufactures a component of MTBE, has brought a number of claims against the United States demanding compensation for lost profits and other business injuries alleged to have resulted from California’s actions. In August 2002, this Tribunal dismissed the majority of Methanex’s claims, but allowed Methanex to amend its claim to attempt to support its allegations that the intent underlying California’s measures violated provisions of Chapter 11.  Bluewater Network, Communities for a Better Environment and the Center for International Environmental Law (jointly “Amici”) make this submission to assist the Tribunal in assessing Methanex’s allegat ions of improper intent.

In evaluating Methanex’s claims, the Tribunal must be guided by principles of international law.  This is particularly true because Methanex refers to international law repeatedly in support of its claim that the California measures were motivated by illegitimate intent. Amici agree with the arguments presented by the United States in its submissions in this phase of the arbitration. In addition to those arguments, however, Amici here address a number of considerations based on p rinciples of international law that the United States either did not address or did not elaborate.

Under international law, governments have both a right and an obligation to regulate to protect human health and the environment. The international legal principles discussed in this submission demonstrate that this Tribunal must give substantial deference to measures implemented to achieve these goals. The principles also apply to the evaluation of California’s intent in implementing the MTBE measures.

Read full text.