Law Times

Page 12 December 3, 2012 Law Times • FOCUS Time for Canada to embrace ICSID: lawyer BY MICHAEL McKIERNAN Law Times C anada is missing out by remaining on the outside of the International Centre for Settlement of Investment Disputes, according to one of Canada's leading international arbitration lawyers. Canada finally signed onto the ICSID Convention in 2006, four decades after it created the arbitration arm of the World Bank. And while the federal government passed enabling legislation in 2008, Canada's ratification of the convention remains in limbo as several provinces and territories have failed to follow suit. "There's two ways it will benefit the Canadian economy," says Barry Leon, head of the international arbitration group at Ottawa's Perley-Robertson Hill & McDougall LLP. "On the incoming side, it will make Canada a more attractive place for foreign investors. On the outbound side, it offers protection for Canadian companies that are investing abroad." The Canadian Chamber of Commerce has endorsed ratification while the Canadian Bar Association added its voice to the chorus with a resolution of council at last year's mid-winter meeting in Charlevoix, Que. The provincial holdouts include Alberta, Quebec, Manitoba, and New Brunswick. But in October, New Brunswick Premier David Alward told the Council of Canadians his government was taking a fresh look at its position. Leon says he hopes things will come together. "My sense is the stars seem to be aligning and the federal government is moving in the direction of ratification. Hopefully it will happen in the reasonably near future," Leon says. "It's very consistent with what the government has been doing with its negotiation of foreign investment protection agreements and free-trade agreements with other countries. But this one has been sitting on the sidelines and not progressing." ICSID has established itself as a leading forum for investor-state disputes. Parties forgo their rights to appeal arbitral awards to the courts and instead agree to abide by decisions except for a limited review by a further ICSID panel. The 1966 convention that ONTARIO LAWYER'S PHONE BOOK 2013 YOUR MOST COMPLETE DIRECTORY OF ONTARIO LAWYERS, LAW FIRMS, JUDGES AND COURTS With more than 1,400 pages of essential legal references, Ontario Lawyer's Phone Book is your best connection to legal services in Ontario. Subscribers can depend on the credibility, accuracy and currency of this directory year after year. More detail and a wider scope of legal contact information for Ontario than any other source: • More than 26,000 lawyers • More than 9,000 law firms and corporate offices • Fax and telephone numbers, e-mail addresses, office locations and postal codes Perfectbound • Published December each year On subscription $71 One time purchase $74 L88804-589 Multiple copy discounts available Prices subject to change without notice, to applicable taxes and shipping & handling. Includes lists of: • Federal and provincial judges • Federal courts, including a section for federal government departments, boards and commissions • Ontario courts and services, including a section for provincial government ministries, boards and commissions • Small claims courts • Miscellaneous services for lawyers Visit carswell.com or call 1.800.387.5164 for a 30-day no-risk evaluation created ICSID has been signed by 158 countries. Canada is one of 11 countries to have signed the agreement without ratifying it and remains the only G8 nation without full membership. International trade lawyer Cyndee Todgham Cherniak says some provinces may have been "spooked" by a fear that they could end up being sued under international trade agreements but is hopeful they'll get past their objections to ICSID. "It's a little bit of an embarrassment for Canada," she says. "When you look at who are the member states, all the main players are there." Although Canadian parties are able to get some use of ICSID under its "additional facility" rules, "there are more options open to you when you have the full range available," Todgham Cherniak says. But Gus Van Harten, an associate professor at Osgoode Hall Law School with a focus on international investment law, isn't so sure Canadians should be too excited about locking into ICSID without the relief valve of judicial review. He views ratification as a "concession of judicial sovereignty to these arbitrators." "I don't think that the arbitrators should be resolving such important questions of law that arise in these cases without the provision for overview by either domestic or international courts," Van Harten says. He concedes that other options for Canadians involved in investor-state disputes, such as United Nations Commission on International Trade Law arbitrations, provide for little more than "a lighttouch review" by local courts. "With ICSID, the default review is to this annulment tribunal, which is made of World Bank appointees drawn from the same club of arbitrators. . . . So rather than having a decision largely not reviewable in Canadian courts, it becomes fully not reviewable in Canadian courts." Van Harten adds: "I find the real push for ICSID often comes from individuals and lawyers 'My sense is the stars seem to be aligning and the federal government is moving in the direction of ratification,' says Barry Leon. who are earning income working as arbitrators in investorstate arbitration." Leon is far more comfortable with keeping ICSID awards in the hands of arbitrators and says insulating arbitral awards from interference by domestic courts is a chief selling feature of the model for Canadian investors seeking protection when investing abroad. Vancouver's First Quantum Minerals Ltd. discovered the risk of foreign investment after pumping hundreds of millions of dollars into a copper mining project in the Democratic Republic of Congo only to have its assets appropriated by the state in 2009. A favourable ICSID ruling would have allowed the company to seize international assets belonging to the DRC. But instead, First Quantum was left to trawl through the Congolese courts and launch an alternative international arbitration process. The mining company eventually exited the DRC in January as part of a $1.2-billion settlement. "In a lot of places in the world, local courts are not very reliable, to put it charitably. In some places, they're government controlled, not independent, and not impartial. When you're in one of those countries and you ask the local court to help enforce a claim against the government, you're not going to get a sympathetic ear," Leon says. LT CONDUCTING EFFECTIVE WORKPLACE INVESTIGATIONS: WHEN IGNORANCE ISN'T BLISS Toronto, Dec. 10th, 2012 In today's environment, conducting effective workplace investigations is essential. An effective investigation reduces the chance of subsequent litigation and increases the prospect for success should litigation result. 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COURSE HIGHLIGHTS • Preparing for an Investigation • Impact of Social Media • Conducting Workplace Investigations • Developing Effective Interview Skills • Key Issues in Different Investigations • Reaching Conclusions and Report Writing For more information or to register, please contact Lexpert® Events at 1-877-298-5868 or e-mail: register@lexpert.ca Untitled-2 1 www.lawtimesnews.com 12-11-27 2:01 PM

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