Democracy Gone Astray

Democracy, being a human construct, needs to be thought of as directionality rather than an object. As such, to understand it requires not so much a description of existing structures and/or other related phenomena but a declaration of intentionality.
This blog aims at creating labeled lists of published infringements of such intentionality, of points in time where democracy strays from its intended directionality. In addition to outright infringements, this blog also collects important contemporary information and/or discussions that impact our socio-political landscape.

All the posts here were published in the electronic media – main-stream as well as fringe, and maintain links to the original texts.

[NOTE: Due to changes I haven't caught on time in the blogging software, all of the 'Original Article' links were nullified between September 11, 2012 and December 11, 2012. My apologies.]

Friday, June 01, 2012

Canada loses NAFTA case against Exxon

Canada has lost a legal battle launched against it by Exxon Mobil Corp. (XOM-N77.92-0.71-0.90%) and Murphy Oil Corp., (MUR-N45.20-1.42-3.05%) two U.S. oil companies who complained that demands by Newfoundland for increased research spending violated the North American free-trade agreement.

A panel of international arbitrators ruled 2-1, with the Canadian appointee dissenting, that rules imposed in 2004 on the oil companies in connection with the Terra Nova and Hibernia oil projects were invalid under NAFTA’s controversial Chapter 11.

The result of the claim, filed in 2007, has not been officially released. It was first reported Friday on the New York-based website Investment Arbitration Reporter, iareporter.com, which follows investor-state arbitration issues. An Exxon source confirmed the result when contacted by The Globe and Mail.

Chapter 11, which allows foreign investors to sue NAFTA’s three signatory governments for policies they allege discriminate against them, has been controversial since the treaty came into effect in 1994.

Anti-free-trade activists have long charged that it gives too much leverage to foreign multinationals, who can use it to block environmental, labour or other laws they don’t like. But losses for Canada under NAFTA proceedings like this have so far been rare.

The decision has not been released publicly. It is reportedly not a clean sweep for the oil companies. While they won their case that the research and development requirements were a “performance requirement” banned under NAFTA, they had also argued that they were denied “fair and equitable treatment,” and the panel rejected this argument.

It is not known how much the ruling will cost Canada. At the time, the parties demanded $50-million. But the arbitration panel has asked for more information in order to calculate damages, and is to rule later on the amount.

Original Article
Source: the globe and mail
Author: JEFF GRAY

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