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According to Public Citizen, the amendment was a modest reform that guaranteed much-needed changes in the NAFTA Chapter 11 investment model in future trade agreements.
Under the model, foreign investors may file a claim in secret NAFTA tribunals to seek compensation when government public interest regulations in any way diminish the value of their investment.
In doing so, the amendment would have instructed U.S. trade negotiators to ensure that future investor provisions do not grant foreign investors rights beyond what the U.S. Constitution provides.
NAFTA's investment chapter (Chapter 11) contains a variety of new rights and protections for investors and investments in NAFTA countries.
If a company believes that a NAFTA government has violated these new investor rights and protections, it can initiate a binding dispute resolution process for monetary damages before a trade tribunal, offering none of the basic due process or openness guarantees afforded in national courts.
These so-called "investor-to-state" cases are litigated in the special international arbitration bodies of the World Bank and the United Nations, which are closed to public participation, observation and input.
A three-person panel composed of professional arbitrators listens to arguments in the case, with powers to award an unlimited amount of taxpayer dollars to corporations whose NAFTA investor privileges and rights they judge to have been impacted.
http://action.citizen.org/pc/issues/votes/?votenum=121&chamber=S&congress=1072WASHINGTON - May 21 - Friends of the Earth expressed disappointment in the loss of an amendment to trade legislation that would have protected environmental standards from foreign investor lawsuits. The amendment, offered by Sen. John Kerry (D-Mass.), sought to address concerns with investment rules like NAFTA's Chapter 11 that allow foreign corporations to bring suits against environmental laws and regulations.
"By voting against the Kerry amendment, the Senate has paved the way for more backdoor corporate assaults on laws that protect our air, water and land," said David Waskow, Friends of the Earth's trade policy coordinator. "The Senate should be protecting the health and safety of Americans, not watching the backs of wealthy polluters who make big campaign contributions
http://www.commondreams.org/news2002/0521-13.htmWASHINGTON - May 15 - Tuesday’s 98-0 passage of an amendment brought to the Senate floor by Sens. Max Baucus (D-Mont.) and Charles Grassley (R-Iowa) highlights the need for the Kerry "Chapter 11" amendment to the trade package coming later this week, Public Citizen’s Global Trade Watch said.
Unlike the amendment sponsored by Sen. John Kerry (D-Mass.), the Baucus-Grassley Amendment does not set the U.S. Constitution as the benchmark for the scope of property rights available to foreign investors in the United States.
"It’s nice they fixed a drafting error by passing the Baucus amendment," said Lori Wallach, director of Public Citizen’s Global Trade Watch. "Now the Senate needs to pass the Kerry Amendment to start fixing the NAFTA Chapter 11 problem."
The Kerry Amendment is based on U.S. Supreme Court rulings on expropriation in that it would guarantee that future trade agreements improve upon the NAFTA model and restrict such investment protection actions to only those cases where government action causes a physical invasion of property or the denial of all economic or productive use of that property.
The Kerry Amendment provides a government screen on future investor-to-state cases consistent with NAFTA’s Article 2103.6 for tax claims, and NAFTA Article 1415 for certain financial services measures. This procedure provides for a government review of a private company’s proposed case to ensure against the filing of frivolous suits.
http://www.commondreams.org/news2002/0515-04.htm