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At Global Affairs Canada in 2018

Published online by Cambridge University Press:  16 October 2019

ALAN H. KESSEL
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Canadian Practice in International Law / Pratique canadienne en matière de droit international
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Canadian Yearbook of International Law/Annuaire canadien de droit international , Volume 56 , October 2019 , pp. 453 - 483
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Copyright © The Canadian Yearbook of International Law/Annuaire canadien de droit international 2019 

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References

1 See, e.g., RL-0051, Içkale Insaat Ltd. Sirketi v. Turkmenistan, ICSID Case No. ARB/10/24, Award, 8 March 2016, ¶ 328.

2 RL-0227, United Parcel Service of America Inc. v. Government of Canada (UNCITRAL), Award on the Merits, 24 May 2007 (“UPS – Award on the Merits”), ¶ 83; CL-055, Loewen Group, Inc. and Raymond L. Loewen v. United States of America, ICSID Case No. ARB(AF)/98/3, Award, 26 June 2003 (“Loewen – Award”), ¶ 139; CL-013, Archer Daniels Midland Company and Tate & Lyle Ingredients Americas Inc. v. The United Mexican States, ICSID Case No. ARB(AF)/04/05, Award, 21 November 2007, ¶ 205; CL-078, S.D. Myers, Inc. v. Government of Canada (UNCITRAL) Partial Award, 13 November 2000 (“S.D. Myers – Partial Award”), ¶ 252. The only difference in the language in NAFTA Article 1103 (Most-Favored-Nation Treatment) and NAFTA Article 1102 (National Treatment) is that the relevant comparator treatment is with respect to the investors and investments of a third State.

3 CAN-001, McLachlan, Campbell et al, International Investment Arbitration: Substantive Principles (Oxford University Press 2007), pp. 256 and 257;CrossRefGoogle Scholar RL-0068, Plama Consortium Limited v. Republic of Bulgaria, ICSID Case No. ARB/03/24, Decision on Jurisdiction, 8 February 2005, ¶ 223 (“[A]n MFN provision in a basic treaty does not incorporate by reference dispute settlement provisions in whole or in part set forth in another treaty, unless the MFN provision in the basic treaty leaves no doubt that the Contracting Parties intended to incorporate them.”)

4 Article XII(1) (emphasis added).

5 Article XII(2)(b) (emphasis added).

6 Article IV(a) (emphasis added).

7 RL-0048, ICS Inspection and Control Services Limited (United Kingdom) v. The Republic of Argentina (UNCITRAL), PCA Case No. 2010-9, Award on Jurisdiction, 10 February 2012 (“ICS – Award”), ¶ 306 (“International arbitration is not an activity inherently linked to the territory of the respondent State.”)

8 RL-069, Vladimir Berschader and Moïse Berschader v. The Russian Federation, SCC Case No. 080/2004, Award, 21 April 2006, ¶ 185 (“The use of the expressions “treatment” and “in its territory” should be noted. This language appears to indicate that what the Contracting Parties had in view was the material rights accorded to investors within the territory of the Contracting States.”); RL-0048, ICS – Award, ¶¶ 305 and 306 (“This practice is highly suggestive. Not only does this create a textual link between all the provisions establishing substantive treatment standards in distinction to the dispute settlement provisions, but it also highlights the non-territorial nature of dispute resolution.”); RL-0073, Daimler Financial Services AG v. Argentine Republic, ICSID Case No. ARB/05/1, Award, 22 August 2012, ¶¶ 228-230 (“In short, it seems that the very concept of extra-territorial dispute resolution and a Host State’s consent thereto are both ill-fitted to the clear and ordinary meaning of the words “treatment in its territory” as found in many BIT’s MFN clauses, including those in the present matter.”)

9 CL-080, Siemens A.G. v. The Argentine Republic, ICSID Case No. ARB/02/8, Decision on Jurisdiction, 3 August 2004, ¶ 85.

10 CL-057, Emilio Agustín Maffezini v. The Kingdom of Spain, ICSID Case No. ARB/97/7, Award, 13 November 2000, ¶ 56.

11 See, e.g., RL-0224, Comprehensive Economic and Trade Agreement between Canada, of the one part, and the European Union and its Member States, of the other part, 30 October 2016 (provisional application on 21 September 2017) (“CETA”), Article 8.7(4); CAN-002, Comprehensive and Progressive Agreement for Trans-Pacific Partnership, 4 February 2016, Article 9.5(3); CAN-003, Canada-Korea Free Trade Agreement, 22 September 2014 (entered into force 1 January 2015), Can. T.S. 2015 No. 3 (“Canada-Korea FTA”), Article 8.4, fn. 2; CAN-004, Canada-Chile Free Trade Agreement, 5 December 1996 (entered into force 5 July 1997), Can. T.S. 1997 No. 50 (“Canada-Chile FTA”), Appendix I: Chapter G – Investment, Article G-03(3).

12 This approach has been confirmed by several NAFTA tribunals, who have rejected the application of the MFN obligation in NAFTA Article 1103 to substantive obligations and dispute settlement procedures, despite the fact that there is no language clarifying the meaning of treatment or an interpretive note issued by the Parties. See, e.g., CL-025, Chemtura Corporation v. Government of Canada (UNCITRAL), Award, 2 August 2010 (“Chemtura – Award”), ¶ 235 (“The Tribunal can dispense with resolving this issue as a matter of principle.”)

1 Panel Report, Australia – Tobacco Plain Packaging (Cuba, Dominican Republic, Honduras, Indonesia), para. 7.2430.

2 The Oxford English Dictionary defines “unjustifiable” as something that “cannot be shown to be just, right, or reasonable; lacking justification”. Similarly, “justifiable” is defined as “supported or justified by good evidence or convincing reasoning; well-founded”. Therefore, whether something is “justifiable” involves whether it [is] defensible, supportable, reasonable, fair, and well founded.

1 Panel Report, US – Supercalendered Paper, para. 7.302 (citing Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 81. See also Appellate Body Reports, US – Softwood Lumber IV (Article 21.5 – Canada), para. 67; and US – Anti-Dumping Methodologies (China), para. 5.122).

2 Appellate Body Reports, Guatemala – Cement I, fn. 47 to para. 69; US – Corrosion-Resistant Steel Sunset Review, paras. 85 and 88; and US – Zeroing (EC), paras. 192-194.

3 Appellate Body Reports, US – Corrosion-Resistant Steel Sunset Review, para. 82; and US – Anti-Dumping Methodologies (China), para. 5.126. The Appellate Body has made this statement with reference to Article 3.2 of the DSU, which refers to the objective of bringing “stability and predictability to the multilateral trading system”.

4 Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review, para. 82.

5 Panel Report, US – Supercalendered Paper, para. 7.303 (citing Appellate Body Reports, Argentina – Import Measures, para. 5.110).

6 Panel Report, US – Supercalendered Paper, para. 7.304 (citing Appellate Body Reports, US – Continued Zeroing, para. 191; and Argentina – Import Measures, para. 5.108).

7 United States’ appellant submission, paras. 9-15.

8 United States’ appellant submission, paras. 11-14 (citing Articles 3.3 and 4.2 of the DSU, and Panel Report, US – Upland Cotton, paras. 7.158-7.160).

9 Appellate Body Report, US – Continued Zeroing, paras. 181 and 185; Panel Report, US – Orange Juice (Brazil), para. 7.176.

10 United States’ appellant submission, para. 10 (citing Panel Report, US – Export Restraints, para. 8.85).

11 Panel Report, US – Export Restraints, paras. 8.80-8.82 and 8.85. The panel was analyzing whether four measures (some relating to legislation and some relating to practice) could individually or taken together give rise to a violation of WTO obligations.

12 Appellate Body Report, EC and certain member States – Large Civil Aircraft, paras. 781 and 794-795. The Appellate Body ultimately decided that the challenged measure fell outside the Panel’s terms of reference, but did not “exclude the possibility that concerted action or practice could be susceptible to challenge in WTO dispute settlement”.

13 Appellate Body Reports, Argentina – Import Measures, para. 5.111.

14 Appellate Body Reports, Argentina – Import Measures, para. 5.108; and US – Continued Zeroing, para. 191.

15 Appellate Body Reports, US – Continued Zeroing, para. 179; and Argentina – Import Measures, para. 5.102.

16 Appellate Body Report, US – Anti-Dumping Methodologies (China), para. 5.125.

17 Appellate Body Reports, Argentina – Import Measures, para. 5.110.

18 Appellate Body Reports, Argentina – Import Measures, para. 5.112.

19 The Appellate Body has stated that “the specific measure challenged and how it is described or characterized by a complainant will determine the kind of evidence a complainant is required to submit and the elements that it must prove in order to establish the existence of the measure challenged”. See Appellate Body Reports, Argentina – Import Measures, para. 5.110.

20 Panel Report, US –Supercalendered Paper, fn. 579 to para. 7.316 (citing Panel Report, US – Anti-Dumping Methodologies (China), para. 7.454, as modified by Appellate Body Report, US – Anti-Dumping Methodologies (China), para. 5.164).

1 Second Session of the Preparatory Committee of the United Nations Conference on Trade and Employment, Verbatim Report, Thirty-Third Meeting of Commission A, 24 July 1947, E/PC/T/A/PV/33, p. 21.

2 Canada’s letter to the Chairman of the Panel, 14 November 2017.

3 The Vienna Convention on the Law of Treaties, done at Vienna, 23 May 1965, 1155 U.N.T.S. 331, Art. 31(1).

4 Marrakesh Agreement Establishing the World Trade Organization, preamble.

5 See for example E/PC/T/31, Report of the Drafting Committee of the Preparatory Committee of the United Nations Conference on Trade and Employment, 5 March 1947, p. 77.

6 Dispute Settlement Understanding, Article 11.

1 Barbados/Trinidad & Tobago 2006 (arbitral tribunal); Bangladesh/Myanmar 2012 (ITLOS); Nicaragua/Columbia 2012 (ICJ); Bangladesh/India 2014 (arbitral tribunal); and Ghana/Cote d’Ivoire 2017 (ITLOS Special Chamber).

2 The genesis of this approach can be traced back to the ICJ’s decision in the North Sea continental shelf case of 1969. The three-step approach was clearly enunciated by the ICJ in Romania/Ukraine in 2009 and used widely since then.

3 E.g. Tunisia/Libya (ICJ 1982); Libya/Malta (ICJ 1985); Guinea/Guinea-Bissau (arbitral tribunal 1986) among others.

4 For an excellent overview of the trends in state practice in the delimitation of the continental shelf beyond 200M see Bjarni Mar Magnusson 2013, ICLQ vol 62 pp 345-372.

1 Canadian domestic law defines a “marine protected area” in the Oceans Act as an area of sea that forms part of the internal waters of Canada, the territorial sea of Canada or the exclusive economic zone (EEZ) of Canada and has been designated for special protection for one or more of the following reasons:

  • •

    • the conservation and protection of commercial and non-commercial fishery resources, including marine mammals, and their habitats

  • •

    • the conservation and protection of endangered or threatened marine species, and their habitats

  • •

    • the conservation and protection of unique habitats

  • •

    • the conservation and protection of marine areas of high biodiversity or biological productivity

  • •

    • the conservation and protection of any other marine resource or habitat as is necessary to fulfill the mandate of the Minister of Fisheries and Oceans Canada.

At the time of writing, Bill C-55 is pending. It would amend the Oceans Act to add an additional purpose for marine protected area designations: “the conservation and protection of marine areas for the purpose of maintaining ecological integrity.”

2 A definition commonly used in international settings is that of the International Union for Conservation of Nature (IUCN). IUCN is a membership union composed of both government and civil society organisations. Their definition is as follows: “Marine Protected Areas (MPAs) involve the protective management of natural areas so as to keep them in their natural state. MPAs can be conserved for a number of reasons including economic resources, biodiversity conservation, and species protection. They are created by delineating zones with permitted and non-permitted uses within that zone.”

3 Art. 192 of UNCLOS.

4 See Canada National Marine Conservation Areas Act (S.C. 2002, c. 18). Parks Canada is responsible for managing NMCAs.

5 A “marine refuge” is a fisheries management measure that is put in place to protect important species and their habitat. Currently, to create a marine refuge in our oceans, Fisheries and Oceans Canada uses licence conditions or variation orders to restrict fishing in a specified area.

6 There are narrow exceptions to this rule — see art. 8(2) of UNCLOS — but they do not apply to any of Canada’s internal waters.

7 See article V of the General Agreement on Tariffs and Trade (GATT). Please consult with Global Affairs’ Trade Law Bureau (JLT) if there are doubts in this respect.

8 Art. 19 of UNCLOS.

9 Art. 18(2) of UNCLOS.

10 Art. 21(1) of UNCLOS.

11 Art. 21(2) of UNCLOS.

12 Art. 24(1) of UNCLOS.

13 See F. Spadi, “Navigation in Marine Protected Areas: National and International Law” Ocean Development and International Law, 31:3 at 288. We would note that in the case of the US, the restrictions are qualified by the savings clause in 16 U.S.C. § 1435, which roughly provides that the regulations only apply to non-Americans in circumstances that accord with international law.

14 Ibid.

15 Ibid at 291 to 293.

16 See Ingvild Jakobsen, “Marine Protected Areas in International Law” at 328.

17 Ibid at 290.

18 Art. 56(1)(a) of UNCLOS.

19 Arts 56 (2), 58 and 87 of UNCLOS.

20 See e.g. Churchill and Lowe, The Law of the Sea, 3rd ed. at 206.

21 Ibid.

22 Art. 56(1)(b)(iii) of UNCLOS.

23 Art. 211(5) of UNCLOS. While article 211(5) of UNCLOS is specific to “pollution”, that term has a broad meaning in article 1 of UNCLOS: “‘Pollution of the marine environment’ means the introduction by man, directly or indirectly, of substances or energy into the marine environment, including estuaries, which results or is likely to result in such deleterious effects as harm to living resources and marine life, hazards to human health, hindrance to marine activities, including fishing and other legitimate uses of the sea, impairment of quality for use of sea water and reduction of amenities.”

24 Article 211(6)(a).

25 Ibid.

26 Ibid.

27 Art. 211(6)(c).

28 For more info about the IMO’s authority to designate PSSAs, see http://www.imo.org/en/OurWork/Environment/PSSAs/Pages/Default.aspx. The IMO has issued guidelines for the identification and designation of PSSAs. These guidelines include criteria to allow areas to be designated a PSSA if they fulfil a number of criteria, including: ecological criteria, such as unique or rare ecosystem, diversity of the ecosystem or vulnerability to degradation by natural events or human activities; social, cultural and economic criteria, such as significance of the area for recreation or tourism; and scientific and educational criteria, such as biological research or historical value.

29 See Spadi supra note 13 at 297.

30 For more information about MARPOL Special Areas, see http://www.imo.org/en/OurWork/Environment/SpecialAreasUnderMARPOL/Pages/Default.aspx.

31 Art. 210 of UNCLOS.

32 Art. 1 of UNCLOS.

33 Ibid.

34 Canada’s “sovereign rights” in its EEZ are listed in article 56(1)(a) of UNCLOS.

35 See Section 6 of UNCLOS, and more specifically, articles 216, 218, 219, and 220.

36 Art. 220(5) and 220(6).

37 Art. 56(1)(a).

38 Art. 62(1).

39 Churchill and Lowe supra [note] 20 at 289.

40 Art. 297(3)(a) of UNCLOS.

41 Art. 77(1) of UNCLOS.

42 Art. 77(2).

43 Art. 77(4). Examples include oyster, crabs, sea cucumbers, coral, sponge and seaweed.

44 Because of the wording of art. 77(1) of UNCLOS, it may be that measures proposed in the name of environmental protection, with no economic element, are not permissible. This is an unsettled question in international law.

45 Art. 78 of UNCLOS.

46 Art. 79 of UNCLOS.

47 Art. 79(2) and (3) of UNCLOS.

48 Art. 78(1).

49 Art. 87 of UNCLOS.

50 The International Convention for the Prevention of Pollution from Ships of 1973 (MARPOL) and regional fisheries management organizations are examples.

51 Art. 246(1) of UNCLOS.

52 Art. 239 of UNCLOS.

53 Art. 246(3) of UNCLOS.

54 Art. 246(5) of UNCLOS.

55 Art 1(3) of UNCLOS [(emphasis added)].

56 See e.g. R.R. Churchill and A.V. Lowe, The Law of the Sea, 3rd ed. (Manchester: Juris Publishing, 1999) at 348; R. D. Brubaker, The Russian Arctic Straits (Leiden: Martinus Nijhoff, 2005) at 227. For a more in depth discussion, see e.g. Donat Pharand, The Arctic Waters and the Northwest Passage: A Final Revisit, Ocean Development & International Law, 38:1-2, 3-69. The reasoning is that if art. 234 does not apply in the territorial sea, it would give coastal states greater rights in their EEZ than their territorial sea, which runs contrary to the framework of UNCLOS. Brubaker goes so far as to call it “absurd”.

57 See e.g. the article on “Innocent Passage” published by the Max Planck Institute on Public International Law at para 41 which says, “This … suggests that neither the regime of innocent passage within the territorial sea nor the freedom of navigation within the exclusive economic zone is fully to apply to such areas.” https://www.ilsa.org/Jessup/Jessup18/Second%20Batch/OPIL_Innocent_Passage.pdf. This is also the conclusion reach by Kristin Bartenstein in “The “Arctic Exception” in the Law of the Sea Convention: A Contribution to Safer Navigation in the Northwest Passage?” 2011 Ocean Development & International Law, 42:1: “In short, the acknowledgment of navigation, applicable to the ice-covered areas encompassed by Article 234, would give the coastal states broader powers than the regime of innocent passage, at least in some respects and notably in respects that are of particular importance for Arctic navigation such as design, construction, crewing, or equipment of vessels.

58 Ibid. With respect to mandatory reporting requirements, Canada cited article 234 in making NORDREG mandatory in 2010. Canada did not seek the IMO’s approval in doing so.