* This document was reproduced and reformatted from the text provided to ILM by Barry Appleton, of Appleton& Associates, counsel for Ethyl Corporation.

1 Ethyl states that it was the sole importer int? Canada of :MMT and also'the sole distributor of it across Canada.

2 Ethyl also produces a second product, known as “Greenburn,” a fuel additive which contains MMT but is designed for use in products other than unleaded gasoline,such as home heating,commercial boiler,and various diesel fuels.Ethyl asserts in its Statement of Claim that it was dissuaded from implementing earlier.plans to market this product in Canada strufug in 1996 by the introduction of the draft legislation that became the MMT Act.

3 Article 1128: Participation by a Part:Y On written notice to the disputing parties, a Party may make submissions to a Tribunal on a question of interpretation of this Agreement.

4 Page 224; line 15-page 227, line 13, of the transcript of the Hefiling on jurisdiction.

5 Article 1116:Claim by an Investor of a Party on Its Own Behalf 1. An investor of a Party may submit to arbitration under this section a claim that another Party has breached an obligation under:(a)Section A or Article 1503(2)(State Enterprises),or(b) 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,and that the investor has incurred loss or damage by reason of, or arising out of, that breach.2.An investor may not make a claim if more than three years have elapsed from the date on which the investor first acquired, or should have first acquired, knowledge of the alleged breach and knowledge that the investor has incurred loss or damage.·

6 Article 1120: Submission of a Claim to Arbitration 1. Except as provided in Annex 1120.1 and provided that six months have elapsed since the events giving rise to a claim, a disputing investor may submit the claim to arbitration under:(a)the ICSID Convention, provided that both the disputing Party and the Party of the investor are parties to the Convention; (b) the Additional Facility Rules of ICSID, provided that either the disputing Party or the Party of the investor, but not both, is a party to the ICSID Convention; or(c)the Uncitral Arbitration Rules.…2 The applicable arbitration rules shall,govern the.arbitration excep to the extent .modified by this Section.

7 Article 1119. Notice of Intent to Submit a Claim to Arbitration The disputing investor shall deliver to the disputing Party written notice of its intention to submit a claim to arbitration at least 90 days before the claim is submitted, which notice shall specify:(a)the name and address of the disputing investor and, where a claim is made under Article 1117, the name and address of the enterprise;(b)the provisions of this Agreement alleged to have been breached and any other relevant provisions;(c)the issues and the factual basis for the claim;and(d)the relief sought and the approximate amount of damages claimed.

8 Article1121:Conditions Precedent to Submission of a Claim to Arbitration 1.A disputing investor may submit a claim under Article 1116 to arbitration only if:(a) the investor consents to arbitration in accordance with the procedures set out in this Agreement;and (b)the investor and, where the claim is for loss or damage to an interest in an enterprise of another Party that is ajuridical 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 Article1116, 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 ifboth the investor and the enteq,rlse:(a)consent to arbitration in accordance with the procedures set out in this Agreement: and (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,i.e.,except for the 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:(a).a waiver from the enterprise under paragraph l(b)or 2(b)shall not be required;and(b)Annex 1120.l(b)shall not apply.

9 Article 1137:General Time when a Claim is Submitted to Arbitration ’‘‘ 1.A claim is submitted to arbitration under this Section when:(c)the notice of arbitration given under the UNCITRAL Arbitration Rules is received by the disputing Party.

10 Article 201:Definitions of General Application 1.For the purposes of this Agreement, unless otherwise specified: measure includes any law, regulation, procedure, requirement: or practice....

11 Article 1101:Scope and Coverage 1.This Chapter applies to measures adopted or maintained by a Party relating to:(b)investments of investors ofanother Party in the territory of the Party; (c)with respect to Articles 1106 and 1'114, all investments in the territory of the Party.

12 Article 2004: Recourse to Dispute Settlement Procedures Excpt for the matters c;overed illChapter Nineteen (Review and Dispute Settlement in Antidumping and Countervailing Duty Matters) and as otherwise noted in this Agreement, the dispute settlemen,t provisions of this Chapter shall apply with respect tohe avoidance or settlement of disputes between the Parties regarding the interpretation or application of this Agreement or wherever a Party considers that an actual or proposed measure of another Party is or would be inconsistent with the obligations of this Agreement or cause nullification or iinpairment in the.sense of Annex 2004.

13 Article 1112: Relation to Other Chapters1.Inthe event of any inconsistency between this Chapter and another Chapter, the other Chapter shall prevail to the extent of the inconsistency.

14 See note 3,supra.

15 Because Mexico's notice was received only on the second.and last day of the Hearing onjurisdiction, Ethyl raised an issue of timeliness. In these circumstances the Tribunal finds it appropriate to underscore the importance of Nafta Parties exercising their Article 1128 rights in a timely fashion.Indeed, Article 1127 is designed to facilitate timely intervention under Article 1128 by providing: Article 1127: Notice A disputing Party shall deliver to the other Parties:(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 (b) copies of all pleadings filed in the arbitration.The Tribunal notes, as it was informed by Canada by letter dated 2 March 1998 pursuant to the Tribunal's request, that the Government of Mexico had been informed of Canada's jurisdictional objections as early as 3 December 1997 and that on 11 December 1997 Canadian Government representatives had met in Ottawa with a Mexican Embassy officer and Mexico's legal counsel “to discuss Canada's jurisdictional arguments and the possibility of Mexico filing a submission pursuant to Article 1128.” Given that Mexico filed its substantive submission with fifteen days after the Hearing onjurisdiction, however, as it had undertaken to do as the Tribunal had requested, and given that the Parties were accorded a period of three weeks within which to comment thereon, of which opportunity Ethyl availed itself, the Tribunal perceived no prejudice to Ethyl in accepting Mexico's submission.

16 The texts are quoted verbatim from Mexico's submission.

17 Page 298, lines 12-14, of the transcript of the Hearing on jurisdiction.

18 See The Islamic Republic of Iran v. The United States of America, Dec.No.32-A18-FT (6 Apr. 1984),reprinted in 5 Iran-U.S. CL Trib. Rep. 251, 259 (1984).U.S.courts look to the Convention .when interpreting the text of a treaty. See,e.g.,Kreimerman v. Casa Veerkamp,A.S. de C.V.,22 F.3d 634, 638 (5th Cir. 1994), cert. den'd, 115 S.Ct. 577 (1994);Day v.Trans World Airlines,Inc.,528 F.2d 31, 33 (2d Cir. 1975),cert. den'd, 429 U.S. 890 (1976).

19 Arechaga, De, International Law in the Past Third of a Century, 159 Recueii.. Des Cours 1, 42 (1978)Google Scholar (''Legal rules concerning the interpretation of treaties constitute one of the Sections of the Vienna Convention which wee adopted without a dissenting vote at the Conference and consequently may be considered as declaratory of existing law“).

20 Canada's statement at Paragraph 23 of its Memorial on Jurisdiction that “these procedures [of Section B] must be strictly adhered to for a Tribunal to have jurisdiction: to hear a claim under Chapter Eleven'’ appears at least to hint at such a principle. Canada's Memorial on Jurisdiction later quite clearly urges this principle in stating (in the heading prefacing Paragraph 49) that ‘Uurisdiction Must Be Strictly Interpreted ….“

21 Free “Zones of Upper Savoy and the District of Gex (Fr. v. Switz.), 1932 P.C.I.J., ser. A/B, No. 46, at 167 (Judgment of 7 June).

22 The Vienna Convention resolved past debates concerning the wisdom of pronouncements by international . tribunals that limitations of sovereignty must be strictly construed. United States-Iran, Case No. Al7, Decision No. DEC 37-Al7-FT (May 13, 1985)(Brower, J., concurring),reprinted in 8 Iran-U.S. Cl. Trib. Rep. 189, 207 (1989).

23 For a discussion of ICSID’ s objective criteriasee Vacuum Salt Products Limited v. The Government of the Republic of Ghana, ICSID Case No. ARB/9211 (Award of 16 Feb.- 1994), reprinted in 9 ICSID Rev.-F.I.L.J. 72 (1994).

24 See, e.g., Schreuer, Christoph, Commentary on the ICSID Convention, 11 ICSID Rev.-F.I.LJ. 318, para.277 (1996)Google Scholar (In the context of ICSID, jurisdiction may be established by virtue of an offer to arbitrate by a host State contained in its legislation or in a treaty, which may be accepted by an investor. The time of mutual consent is determined by the investor's acceptance of the offer. This offer may be accepted through bringing a request for arbitration to the Centre.)

25 Specifically, Article 1106(2) and (6):2.A measure that requires an investment to use a technology to meet generally applicable health, safety or environmental requirements shall not be construed to be inconsistent with paragraph 1(f).For greater certainty, Articles 1102 and 1103 apply to the measure.6.Provided that such measures are not applied in an arbitrary or unjustifiable manner, or do not constitute a disguised restriction on international trade or investment, nothing in paragraph l(b) or (c) or 3(a) or (b) shall be construed to prevent any Party from adopting or maintaining measures, including environmental measures: (a) necessary to secure compliance with laws and regulations that are not inconsistent with the provisions of this Agreement; (b) necessary to protect human, animal or plant life or health; or (c) necessary for the conservation of living or non-living exhaustible natural resources.

26 See note 28, infra.

27 Canada's three witnesses all dealt with the legislative process. They were Raymond L. du Plessis, for 20 years Law Clerk and Parliamentary Counsel to the Senate of Canada; Ilona Nickels, a Congressional Consultant in the United States with, inter alia, 13 years service in the Congressional Research Service; and Professor Alexander Wayne MacKay, an expert on Canadian constitutional law.

28 Canada concedes that a Bill becomes a “measure” upon the giving of Royal assent, even though the Act may not come into force in accordance with its terms for some time,e.g., 60 days as in the case of the MMT Act.Pages 184 (line 17) -185 (line 18) of the transcript of the Hearing on jurisdiction.

29 Article llOl(c)applies Article 1106 specifically to “all investments in the territory of the party.“(Emphasis added).

30 Accordingly, the Tribunal does not decide what significance, if any, is to be attributed to the fact that Article 1106, like Article 1110, includes the phrase “in its territory,“whereas Article 1102 does not.

31 It is possible that the Canadian officials feared admitting a “consultation” might compromise the position that Bill C-94, then pending third reading in the House of Commons, was not a “measure.I'

32 TheCanadian Statement on Implementation of NAFTA (at page 154) expressly states that the six-month rule “is intended to pennit time to resolve the matter amicably.“

33 Finnish Ships Arbitration (Finland v. U.K.), (Award of 9 May 1934) (Bagge, sole arb.), reprinted in 3 R.I.A.A. 1479 (1934)(Finland's failure to appeal to the Court of Appeal did not mean that it had not exhausted local remedies.Such an appeal would have been “obviously futile“because the Court of Appeal could not have reversed the Boards’ finding of fact);Panevezys-Sald11tiskis Railway Case, (Estonia v. Lithuania),P.C.I.J. Rep., Ser.NB., No. 76, p.18 (1939) (“There can be no need to resort to the municipal court if … the result must be a repetition of a decision already.given.“).

34 Specifically, the Tribunal concludes thalihis results from interpreting those Articles in good faith in accordance with the ordinary meaning to be given to the terms thereof in their context and in the light of the object and purpose of NAFI'A, as prescribed by Article 31 of the Vienna Convention, and that, considering particularly the circumstances of NAFTA's conclusion, any different interpretation would lead to a result which is manifestly absurd or umeasonable within the meaning of Article 32 of theVienna Convention.

35 See note 2,supra.

36 Normally it is a statement of claim that is itself amended at a later stage. The issue of a possible amendment made by a statement of claim to a notice of arbitration arises in the NAFT A context, however, because of the procedural strictures discussed above.

37 As pointed out by Baker & Davis,The Unicitral Arbitration Rules in Practice: The Experience of the Iran-United States Claims Tribunal 91-92 (Kluwer 1992):