Ottawa Citizen

Mexico, Canada appeal NAFTA panel's multimillion-dollar award to U.S. company

HARDIP JOHAL

VANCOUVER (CP) - Canada is intervening on Mexico's behalf in a review of a NAFTA tribunal decision to award US$16.7 million to a U.S.-based corporation that was denied permission to operate a toxic-waste dump in Mexico. Mexico was ordered to pay the award to Metalclad Corp. after the company was denied a municipal licence to operate a hazardous waste treatment facility and landfill site.

When the NAFTA tribunal released its decision last August, it held that in denying the licence, Mexico failed to meet the minimum standard of treatment obligations outlined by NAFTA.

Canada disagrees with that assessment.

In its submission to the British Columbia Supreme Court, where the review begins Monday, Canada will argue that the tribunal's decision contains errors that may create uncertainty about the application and scope of NAFTA's obligations.

"As a member of NAFTA, Canada has a direct interest in ensuring that interpretations . . . are consistently and appropriately applied by NAFTA tribunals," International Trade Minister Pierre Pettigrew said in a news release.

Jo Dufay of Greenpeace Canada sees the case as an illustration of how NAFTA gives "sweeping rights to corporations."

"This case is a really clear example of how NAFTA puts corporate profits ahead of environmental considerations," said Dufay.

"This case is a really clear example of the way in which NAFTA puts corporate profits ahead of environmental concerns and it puts foreign corporations above the law of the land."

Canada's submission will argue that any interpretation of NAFTA must promote a government's ability to safeguard public interests.

The Canadian government will also contend that the NAFTA tribunal did not have authority to expand the obligations intended by NAFTA's drafters.

-- Rachel Gibson (rgibson@hotmail.com), February 18, 2001