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This Article examines the growing opposition to arbitration of investor-state disputes involving challenges to regulatory measures under Chapter 11 of NAFTA. The NAFTA Parties apparently seek to restore national sovereignty over such matters by subjecting these awards to heightened review by municipal courts at the seat of arbitration, effectively giving Canadian, Mexican, and United States courts the final authority to interpret Chapter 11. When successful, this practice violates both the letter of Chapter 11 and the intent of the NAFTA Parties to place investor-state disputes within the deferential legal framework of international commercial arbitration. Although the NAFTA Parties may, escape liability for such unlawful conduct, they threaten to undermine the past century's efforts to promote robust principles of state responsibility for economic injuries to aliens. Furthermore, routine derogation from the principle of voluntary acceptance of authoritative decisions rendered at the international level by impartial bodies charged with supervision of treaty compliance bodes ill for the development of the rule of law in international economic relations.


International Trade Law | Transnational Law