IN THE ARBITRATION UNDER CHAPTER 11
OF THE NORTH AMERICAN FREE TRADE AGREEMENT
AND THE UNCITRAL ARBITRATION RULES
BETWEEN
METHANEX CORPORATION,
Claimant/Investor,
-and-
UNITED STATES OF AMERICA,
Respondent/Party.
AMENDED PETITION OF
COMMUNITIES FOR A BETTER ENVIRONMENT,
THE BLUEWATER NETWORK OF EARTH ISLAND INSTITUTE,
AND THE CENTER FOR INTERNATIONAL ENVIRONMENTAL LAW
TO APPEAR JOINTLY AS AMICI CURIAE
J. Martin Wagner
Scott Pasternack
EARTHJUSTICE LEGAL DEFENSE FUND
180 Montgomery Street, Suite 1725
San Francisco, CA 94104
Tel: (415) 627-6700
Fax: (415) 627-6749
[email protected]
[email protected]
Counsel for
COMMUNITIES FOR A BETTER ENVIRONMENT, BLUEWATER NETWORK, and
CENTER FOR INTERNATIONAL ENVIRONMENTAL LAW
October 13, 2000
IN THE ARBITRATION UNDER CHAPTER 11
OF THE NORTH AMERICAN FREE TRADE AGREEMENT
AND THE UNCITRAL ARBITRATION RULES
BETWEEN
METHANEX CORPORATION,
Claimant/Investor,
-and-
UNITED STATES OF AMERICA,
Respondent/Party.
AMENDED PETITION OF
COMMUNITIES FOR A BETTER ENVIRONMENT,
THE BLUEWATER NETWORK OF EARTH ISLAND INSTITUTE,
AND THE CENTER FOR INTERNATIONAL ENVIRONMENTAL LAW
TO APPEAR JOINTLY AS AMICI CURIAE
INTRODUCTION
1. This amended petition supersedes the petition submitted to the Tribunal on
September 6, 2000. By this petition, Communities for a Better Environment (“CBE”), the
Bluewater Network of Earth Island Institute (“Bluewater”) and the Center for International
Environmental Law1 ("CIEL"; together with CBE and Bluewater, “Petitioners”), request
permission to participate jointly in this arbitration as amici curiae. Petitioners request that, for
all stages of this arbitration, such participation include the opportunity to review memorials of the
parties and any other submissions or orders in the proceedings, as well as to attend the
Tribunal’s hearings, and to make oral and written submissions according to a schedule
determined by the Tribunal.
1 The Center for International Environmental Law has been added as one of the Petitioners in ↩
this Amended Petition.
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2. As non-governmental environmental and international law organizations with
substantial expertise concerning the matters underlying Methanex’s claim under NAFTA’s
Chapter 11, Petitioners’ participation would be of significant assistance to the Tribunal.
Moreover, as representatives of serious public environmental and human health concerns,
Petitioners’ participation is important as a safeguard of democratic processes and will help to
ensure the legitimacy of the Tribunal’s decision. Finally, this Tribunal has the authority to grant
this petition.
3. Support for the participation of amici in this case is widespread. Numerous
representatives of civil society in the United States, Canada and Mexico that have expressed
their position on the matter. Over 80 public interest organizations from all three countries have
written to the Tribunal to express their concerns and urge the participation of amici, as well as
to indicate that Petitioners’ participation will help ensure that their concerns are represented to
the Tribunal. See Letter from Nongovernmental Organizations, Oct. 13, 2000, Appendix at
Tab 1 (hereafter “App. #”). Five members of the Senate of the State of California have written
to urge the Tribunal to allow amicus participation. See Letter from Senator Tom Hayden, et
al., Oct. 12, 2000, App. 2. Should further expressions of public concern regarding these
proceedings come to our attention, we will make them available to the Tribunal.
BY VIRTUE OF THEIR EXPERIENCE AND EXPERTISE,
PETITIONERS ARE APPROPRIATE AMICI CURIAE
4. Petitioners’ qualifications to participate in this proceeding as amici are
unquestionable. CBE is a California non-profit, community-based organization dedicated to
protecting the environmental health and justice interests of the citizens of California. Bluewater
is a project of Earth Island Institute, a national environmental organization that develops and
supports projects to protect the biological diversity that sustains the environment. Bluewater’s
mission is to protect public waters, lands and ecosystems throughout the United States from
damage caused by motorized recreation, oil and shipping industry practices and other types of
marine pollution. CIEL was founded in 1989 to strengthen international and national
environmental law and policy around the world. In particular, CIEL’s Trade and Environment
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program seeks to reform the global framework of economic law, policy and institutions in order
to create a more balanced global economy that is environmentally sustainable and benefits all
people in a more equitable way.
5. Petitioners have significant experience and expertise in the issues that are at the
heart of this dispute. Since 1991 and 1997 respectively, CBE and Bluewater have worked to
educate the public concerning the environmental and health risks posed by MTBE and to
require the removal of MTBE from California gasoline, efforts that culminated with the
Executive Order that Methanex cites as the basis for its claim. Both CBE and Bluewater have
testified frequently before and provided written comments to the California legislature and
executive agencies concerning the risks posed by MTBE. See “CBE’s Work to Ban MTBE,”
App. 3; Letters from Bluewater Network to California Legislators, App. 4. In addition, CBE
has brought suit against oil companies to obtain redress for the health and environmental harm
resulting from the use of MTBE in their reformulated gasoline. App. 3. Bluewater has also
worked extensively the US Congress concerning the risks of MTBE, bringing the issue to
national attention. See Bluewater Network Press Releases, App. 5.
6. Similarly, CIEL provides special expertise in international environmental law and
comparative national environmental law. Its work in these fields includes policy research and
publication, advice and advocacy, education and training, and institution building. CIEL’s
writings on the intersection of investment rules and environmental regulation include:
“Investment Agreement of the Americas: Environmental, Economic, and Social Perspectives,”
“International Environmental Law and Foreign Direct Investment” in Legal Aspects of Foreign
Direct Investment (Kluwer, 1999); and “Case Studies on the Multilateral Agreement on
Investment’s Potential Impact on Environmental Law in Developing Countries.” CIEL has
prepared and submitted amicus briefs to the WTO dispute settlement process. CIEL also hold
consultative status with the United Nations, which indicates that CIEL is “of representative
character and of recognized international standing,” has special competence in the area of its
expertise and is an organization from whom the United Nations can “secure expert information
or advice” on these subjects. See Arrangements for Consultation with Non-governmental
Organizations, ECOSOC Res. 1296 (XLIV), at ¶¶ 4 and 14 (23 May 1968), App. 6.
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7. In addition to Petitioners’ expertise, counsel for Petitioners, Earthjustice Legal
Defense Fund, has substantial litigation expertise in international trade law and its nexus with
environmental protection. Earthjustice lawyers have litigated, taught, written and spoken
extensively on these matters, as well as on the relationship between international investment
protections and environmental measures. See, e.g., J. Martin Wagner, International
Investment, Expropriation and Environmental Protection, 29 GOLDEN GATE U. L. REV.
465 (1999). Earthjustice lawyers also wrote and submitted the first, and several subsequent,
amicus submissions to the World Trade Organization. Like CIEL, Earthjustice has been
granted consultative status with the United Nations.
8. Petitioners and their counsel are thus among the foremost experts on the
environmental and health risks posed by MTBE and the international legal issues raised by
Methanex’s claim. CBE, Bluewater and CIEL’s participation in this arbitration as amici will
provide a valuable perspective and help to ensure full consideration of important issues of public
concern that might otherwise be omitted.
FUNDAMENTAL PRINCIPLES OF DEMOCRACY
SUPPORT PETITIONERS’ PARTICIPATION
IN THIS ARBITRATION
9. Amici curiae should be allowed to participate in the arbitration of Methanex’s
challenge under NAFTA’s Chapter 11 for several reasons. First, the arbitration implicates
issues of constitutional importance, as well as fundamental democratic principles. Second, the
outcome of this arbitration may affect not only the ability of California to maintain the phase-out,
but the willingness and ability of governments at all levels in Canada, Mexico and the United
States to implement measures to protect the environment or human health in the future. Finally,
these concerns bring into issue the legitimacy of the proceedings and of the Tribunal’s award.
10. The significance of the legal questions at issue in this dispute reinforces the need for
amicus participation. In each of the NAFTA countries, the careful balance between
governmental authority to regulate for the public interest and private property rights is an issue of
constitutional importance. In these countries, this balance may only be challenged in judicial fora
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that are open to public scrutiny and participation by interested and affected citizens.
Methanex’s claim in this case requires this Tribunal to decide how NAFTA’s Article 1110
affects the balance of governmental authority to implement environmental regulations and
property rights. The importance of public participation – at least through amici – is at least as
great in this proceeding as in the analogous domestic proceedings.
11. This arbitration also implicates fundamental democratic principles. The California
MTBE phase-out was developed through an open and democratic process that gave members
of the public - including environmental and health organizations, as well as individual and
corporate proponents and opponents of the measure – the opportunity to express their opinions
orally and in writing. The Tribunal’s award could jeopardize that publicly-adopted measure by
creating a major disincentive for California to maintain the phase-out. A decision with such
implications for a democratically-developed environmental measure should not be made in a
proceeding that excludes public participation.
12. This case is unlike most private commercial arbitration proceedings, in which the
matters at issue are of primary, if not exclusive, concern to the immediate parties to the
proceeding. The Tribunal’s decision in this case could alter the legal obligations that apply to
governments when they regulate to protect the environment or human health, as well as the
economic and other factors they take into account when deciding whether to do so.2 For this
reason, as well as those noted above, the Tribunal’s award will have broad implications for the
general public, the environment, and for the authority and capacity of governments to regulate in
the future. The broad impact of these proceedings mitigate in favor of amicus participation.
2 Although the Tribunal’s interpretation of NAFTA will not be binding on panels considering ↩
other government regulations, NAFTA tribunals have recognized decisions of other arbitral
tribunals as “persuasive.” See, e.g., In the Arbitration under Chapter 11 of NAFTA and the
ICSID Arbitration Rules between Metalclad Corporation and the United Mexican States,
States, Case No. ARB(AF)/97/1, ¶ 108 (Aug. 30, 2000), App. 7. Moreover, as the first
tribunal to address directly whether an otherwise legitimate environmental regulation creates an
obligation for a government to compensate for future profits lost due to the regulation, this
Tribunal’s decision may have particularly persuasive weight. Governments are thus likely to
consider the Tribunal’s interpretation of NAFTA as, at the very least, the most likely
interpretation that will apply to their regulatory efforts.
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13. Because of the significance of all of these issues, the proceedings in this case and the
Tribunal’s award will be the subject of great public scrutiny. Petitioners’ work on these matters
has brought them recognition as representatives of the public’s environmental and health
concerns regarding MTBE. Giving Petitioners the opportunity formally to represent the public’s
environmental and health concerns regarding MTBE during the arbitration process may help
assuage public apprehension that the arbitration process is a secretive one in which private
interests are given priority over public concerns.
14. Furthermore, allowing Petitioners to participate in this arbitration is consistent with
the fundamental democratic laws and processes of both the United States and Canada. In both
countries, affected and concerned citizens have the opportunity to participate, either as
intervenors or amici, when, as here, a tribunal is to decide matters of serious public concern.
As a result, the participation of Petitioners as amici should neither come as a surprise, nor be an
unacceptable burden, to either party to this dispute.
THE TRIBUNAL HAS THE AUTHORITY TO GRANT THIS REQUEST
15. This arbitration is to be conducted according to the rules of UNCITRAL, as
modified by Section B of NAFTA Chapter 11. See NAFTA Article 1120.2. Nothing in the
applicable rules precludes Petitioners’ participation as amici. Rather, Article 15.1 of the
UNCITRAL rules explicitly allows the Tribunal to “conduct the arbitration in such manner as it
considers appropriate.” This provision is intended to “give[] the arbitrators the power to
regulate the conduct of the proceedings,” because “flexibility during the proceedings and
reliance on the expertise of the arbitrators are two of the hallmarks of arbitration.” Report of
the Secretary General: revised draft set of arbitration rules for optional use in ad hoc
arbitration relating to international trade: commentary on the draft UNCITRAL
Arbitration Rules, U.N. Doc. A/CN.9/112/Add.1 (1975), reprinted in [1976] 7 Y.B.
Comm’n Int’l Trade L. 166, App. 8. See also UNCITRAL Notes on Organizing Arbitral
Proceedings (1996), ¶ 4, App. 9. The power to conduct the arbitration as the Tribunal
considers appropriate includes the authority to allow the participation of amici curiae.
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16. The practice of the WTO Appellate Body supports this Tribunal’s authority to allow
Petitioners to participate as amici curiae. The Appellate Body has affirmed that it and WTO
dispute settlement panels have the authority to accept and consider amicus submissions (and
has in fact accepted such a submission from one of Bluewater’s sister programs at Earth Island
Institute), despite the absence of any explicit provision for such submissions in the WTO
Dispute Settlement Understanding (DSU). See United States – Import Prohibition of
Certain Shrimp and Shrimp Products, WT/DS58/AB/R (Oct. 12, 1998), ¶¶ 83, 110, App.
10; United States – Imposition of Countervailing Duties on Certain Hot-Rolled Lead and
Bismuth Carbon Steel Products Originating in the United Kingdom, WT/DS138/AB/R, ¶¶
38-42 (May 10, 2000), App. 11.
17. The reasoning underlying the Appellate Body’s acceptance of amicus submissions
in the Hot-Rolled Lead dispute applies equally to this arbitration. The Appellate Body noted
that nothing in the applicable rules explicitly permitted it to or prohibited it from accepting or
considering submissions from non-parties to the appeal. United States – Imposition of
Countervailing Duties on Certain Hot-Rolled Lead and Bismuth Carbon Steel Products
Originating in the United Kingdom, WT/DS138/AB/R at ¶ 39. Those rules did, however,
give the Appellate Body “broad authority to adopt procedural rules which do not conflict with”
any of the applicable rules.3Id. On this basis, the Appellate Body concluded that it had legal
authority “to accept and consider amicus curiae briefs in an appeal in which we find it pertinent
and useful to do so.” Id. ¶ 42.
18. The same analysis applies to Petitioners’ request to participate as amici in the
present arbitration. There are no provisions of NAFTA or UNCITRAL that specifically
address amicus submissions. Like the WTO’s DSU and the Appellate Body’s Working
3 The Appellate Body cited Article 17.9 of the WTO’s Dispute Settlement Understanding, ↩
which gives the Body authority to establish its working procedures. It also cited Article 16.1 of
the Working Procedures, which gives the particular panel hearing an appeal authority “to
develop an appropriate procedure in certain specified circumstances where a procedural
question arises that is not covered by the Working Procedures.” United States – Imposition
of Countervailing Duties on Certain Hot-Rolled Lead and Bismuth Carbon Steel Products
Originating in the United Kingdom, WT/DS138/AB/R at ¶ 39, fn. 33.
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Procedures, Article 15.1 gives this Tribunal broad authority to conduct the arbitration in such a
manner as it considers appropriate, as long as it does not conflict with any applicable rule. As
the Appellate Body determined in the Hot-Rolled Lead case, the question of amicus
participation is a procedural issue.4 The Tribunal therefore has the authority to permit such
amicus participation as it considers pertinent and useful.5
19. The Appellate Body has also noted the importance of broad authority that allows a
tribunal to consider amicus submissions. In the Shrimp case, the Appellate Body noted that
ample and extensive authority to undertake and to control the process by which [a
panel] informs itself both of the relevant facts of the dispute and of the legal norms and
principles applicable to such facts . . . is indispensably necessary to enable a panel to
discharge its duty . . . to make an objective assessment of the matter before it, including
an objective assessment of the facts of the case and the applicability of and
conformity with the relevant covered agreements.
United States – Import Prohibition of Certain Shrimp and Shrimp Products,
WT/DS58/AB/R (Oct. 12, 1998), ¶ 106 (quotation omitted; emphasis added by the Appellate
Body).
20. The United States itself has argued that the general authority to develop and manage
the arbitration procedures includes the authority to accept amicus curiae submissions. See
United States – Imposition of Countervailing Duties on Certain Hot-Rolled Lead and
Bismuth Carbon Steel Products Originating in the United Kingdom, WT/DS138/AB/R
(May 10, 2000), ¶ 38. The United States has also recognized the value of amicus participation
in international dispute resolution. In urging that the Appellate Body consider amicus
submissions in the Shrimp case, the United States explained that it should do so because the
nongovernmental organization amici
4 The Appellate Body determined that its authority to adopt procedural rules included authority ↩
to accept and consider amicus submissions. See id. ¶¶ 39, 42.
5 The Tribunal’s authority to regulate the arbitration proceedings as it considers appropriate ↩
does not depend on the consent of the parties. See, e.g., Dadras Int’l v. Iran, Iran-U.S. Cl.
Trib., 1995 Iran Award 567-213, 1995 WL 1132818, ¶¶ 59-61, App. 12 (allowing the
submission of an affidavit over Iran’s objection that it would not be able to cross-examine the
affiant).
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“have a great interest, and specialized expertise, in [the environmental matters at issue in
the case]. It is appropriate therefore that the Appellate Body be informed of those
organizations’ views.”
United States – Import Prohibition of Certain Shrimp and Shrimp Products,
WT/DS58/AB/R (Oct. 12, 1998), ¶ 86 (quoting U.S. statement dated 13 Aug. 1998).
21. As noted above, the Tribunal must exercise its authority to adopt procedural rules
granted under Article 15.1 without conflicting with any of the other applicable rules. Permitting
amicus participation would not conflict with any of the rules applicable to this arbitration.
22. One such rule is set forth in the continuation of Article 15.1 of the UNCITRAL
rules, which requires that the Tribunal exercise its procedural authority in a manner that ensures
that “the parties are treated with equality and that at any stage of the proceedings each party is
given a full opportunity of presenting his case.” UNCITRAL Arbitration Rules, Article 15.1.
Allowing Petitioners to participate as amici curiae in no way jeopardizes the ability of the
Tribunal to treat the parties equally or to give each a full opportunity to present his case. As
demonstrated by the Tribunal in establishing a procedure to address these petitions concerning
participation by amici curiae, this Tribunal is capable of establishing procedures that permit
such participation while treating the parties fairly and giving each full opportunity to present his
case, as well as to address assertions made by the amici. This is consistent with the position
previously taken by the United States, which indicated to the WTO Appellate Body that
accepting amicus submissions would not interfere with the equality of the proceedings or
compromise their confidentiality. See United States – Imposition of Countervailing Duties
on Certain Hot-Rolled Lead and Bismuth Carbon Steel Products Originating in the
United Kingdom, WT/DS138/AB/R (May 10, 2000), ¶ 38.
23. Judicial practice in the United States also supports the authority of the Tribunal to
permit amicus participation. The U.S. Supreme Court has noted that federal courts have the
power “to appoint amici to represent the public interest in the administration of justice.” United
States v. Barnett, 376 U.S. 681, 738 (1964), App. 13. In U.S. courts,
[t]he privilege of being heard amicus rests solely with the discretion of the court.
Generally, courts have exercised great liberality in permitting an amicus curiae to file a
brief in a pending case, and, with further permission of the court, to argue the case and
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introduce evidence. There are no strict prerequisites that must be established prior to
qualifying for amicus status; an individual seeking to appear as amicus must merely make
a showing that his participation is useful to other otherwise desirable to the court.
In re Roxford Foods Litigation, 790 F. Supp. 987, 997 (E.D. Cal. 1991) (quotation and
citations omitted), App. 14. See also Hoptowit v. Ray, 682 F.2d 1237, 1260 (9th Cir. 1982)
(“The district court has broad discretion to appoint amici curiae.”), App. 15.
24. The frequent participation of amici curiae in U.S. legal proceedings highlights the
importance of amicus participation and demonstrates that such participation neither jeopardizes
fair treatment of the parties nor unduly burdens the courts. Between 1969 and 1981, amici
curiae participated in 64% of the Supreme Court’s “noncommercial” cases, see Dinah Shelton,
The Participation of Nongovernmental Organizations in International Judicial
Proceedings, 88 AM. J. OF INT’L L. 611, 618 (1994), App. 16, and the Court cited amicus
briefs in 18% of its decisions. See Susan Hedman, Friends of the Earth and Friends of the
Court: Assessing the Impact of Interest Group Amici Curiae in Environmental Cases
Decided by the Supreme Court, 10 VA. ENVTL. L.J. 187, 192 (1991), App. 17. Amicus
participation has been even higher in cases of general public concern. For example, amici
participated in 86% of the environmental cases heard by the Supreme Court in the 1980s. See
id.
25. In sum, this panel has authority under Article 15.1 of the UNCITRAL rules to allow
Petitioners to participate in this arbitration as amici curiae.
PETITION
26. For the foregoing reasons, Petitioners respectfully request permission to participate
in the arbitration proceeding as amici curiae. Petitioners request that, for all stages of this
arbitration, such participation include the opportunity to review memorials of the parties and any
other submissions or orders in the proceedings, as well as to attend the Tribunal’s hearings, and
to make oral and written submissions according to a schedule determined by the Tribunal.
J. Martin Wagner
Scott Pasternack
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EARTHJUSTICE LEGAL DEFENSE FUND
180 Montgomery Street, Suite 1725
San Francisco, CA 94104
Tel: (415) 627-6700
Fax: (415) 627-6749
[email protected]
[email protected]
Counsel for
COMMUNITIES FOR A BETTER
ENVIRONMENT, BLUEWATER NETWORK, and
CENTER FOR INTERNATIONAL
ENVIRONMENTAL LAW
October 13, 2000