NAFTA - Investment

                              Chapter Eleven

                         Subchapter A - Investment



Article 1101: Scope

1.   This Chapter applies to measures adopted or maintained by a
Party relating to:

     (a) investors of another Party;

     (b) investments of investors of another Party in the
 territory of the Party existing at the date of entry
 into force of this Agreement as well as to investments
 made or acquired thereafter by such investors; and

     (c) with respect to Article 1106, all investments in the
 territory of the Party existing at the date of entry
 into force of this Agreement as well as to investments
 made or acquired thereafter.

2.   A Party has the right to perform exclusively the economic
activities set out in Annex III and to refuse to permit the
establishment of investment in such activities.

3.   This Chapter does not apply to Chapter Fourteen (Financial
Services) except to the extent specifically provided therein.

4.   Nothing in this Chapter shall be construed to prevent a
Party from providing a service or performing a function such as
law enforcement, correctional services, income security or
insurance, social security or insurance, social welfare, public
education, public training, health, and child care, in a manner
that is not inconsistent with this Chapter.



Article 1102: National Treatment

1.   Each Party shall accord to investors of another Party
treatment no less favorable than that it accords, in like
circumstances, to its own investors with respect to the
establishment, acquisition, expansion, management, conduct,
operation and sale or other disposition of investments.

2.   Each Party shall accord to investments of investors of
another Party treatment no less favorable than that it accords,
in like circumstances, to investments of its own investors with
respect to the establishment, acquisition, expansion, management,
conduct, operation and sale or other disposition of investments.

3.   The treatment accorded by a Party under paragraphs 1 and 2
means, with respect to a state or province, treatment no less
favorable than the most favorable treatment accorded, in like
circumstances, by such state or province to investors, and to
investments of investors, of the Party of which it forms a part.

4.   For greater certainty, no Party shall:

     (a) impose on an investor of another Party a requirement
 that a minimum level of equity in an enterprise in the
 territory of the Party be held by its nationals, other
 than nominal qualifying shares for directors or
 incorporators of corporations; or

     (b) require an investor of another Party, by reason of its
 nationality, to sell or otherwise dispose of an
 investment in the territory of the Party.


Article 1103: Most-Favored-Nation Treatment

1.   Each Party shall accord to investors of another Party
treatment no less favorable than that it accords, in like
circumstances, to investors of another Party or of a non-Party
with respect to the establishment, acquisition, expansion,
management, conduct, operation and sale or other disposition of
investments.

2.   Each Party shall accord to investments of investors of
another Party treatment no less favorable than that it accords,
in like circumstances, to investments of investors of another
Party or of a non-Party with respect to the establishment,
acquisition, expansion, management, conduct, operation and sale
or other disposition of investments.


Article 1104: Non-discriminatory Treatment

     Each Party shall accord to investors of another Party and to
investments of investors of another Party the better of the
treatment required by Articles 1102 and 1103 ("non-discriminatory
treatment").


Article 1105: Minimum Standard of Treatment

1.   Each Party shall accord to investments of investors of
another Party treatment in accordance with international law,
including fair and equitable treatment and full protection and
security.

2.   Without prejudice to paragraph 1 and notwithstanding Article
1108 (8) (b), each Party shall accord to investors of another
Party, and to investments of investors of another Party,
non-discriminatory treatment with respect to measures it
maintains or adopts relating to losses suffered by investments in
its territory owing to armed conflict or civil strife.

3.   Paragraph 2 shall not apply to existing measures related to
subsidies or grants that are inconsistent with Article 1102.


Article 1106: Performance Requirements

1.   A Party shall not impose the following requirements, or
enforce any commitment or undertaking, in connection with the
establishment, acquisition, expansion, management, conduct or
operation of an investment of an investor of a Party or of a
non-Party in its territory:

     (a) to export a given level or percentage of goods or
 services;

     (b) to achieve a given level or percentage of domestic
 content;

     (c) to purchase, use or accord a preference to goods
 produced or services provided in its territory, or to
 purchase goods or services from persons in its
 territory;

     (d) to relate in any way the volume or value of imports to
 the volume or value of exports or to the amount of
 foreign exchange inflows associated with such
 investment;

     (e) to restrict sales of goods or services in its territory
 that such investment produces or provides by relating
 such sales in any way to the volume or value of its
 exports or foreign exchange earnings;

     (f) to transfer technology, a production process or other
 proprietary knowledge to a person in its territory,
 except when the requirement is imposed or the
 commitment or undertaking is enforced by a court,
 administrative tribunal or competition authority to
 remedy an alleged violation of competition laws; or

     (g) to act as the exclusive supplier of the goods it
 produces or services it provides to a specific region
 or world market.

2.   A requirement that an investment use a technology to meet
generally applicable health, safety or environmental
standards-related measures, as defined in Article 915, shall not
be construed to be inconsistent with paragraph 1(f).  For greater
certainty, Articles 1102, 1103 and 1104 shall apply to such
requirements.

3.   A Party shall not condition the receipt or continued receipt
of an advantage, in connection with investments in its territory
of investors of a Party or of a non-Party, on compliance with any
of the following requirements:

     (a) to purchase, use or accord a preference to goods
 produced in its territory, or to purchase goods from
 producers in its territory;

     (b) to achieve a given level or percentage of domestic
 content;

     (c) to relate in any way the volume or value of imports to
 the volume or value of exports or to the amount of
 foreign exchange inflows associated with such
 investment; or

     (d) to restrict sales of goods or services in its territory
 that such investment produces or provides by relating
 such sales in any way to the volume or value of its
 exports or foreign exchange earnings.

4.   Nothing in paragraph 3 shall be construed to prevent a Party
from conditioning the receipt or continued receipt of an
advantage, in connection with investments in its territory of
investors of a Party or of a non-Party, on compliance with a
requirement to locate production, provide a service, train or
employ workers, construct or expand particular facilities, or
carry out research and development, in its territory.

5.   Paragraphs 1 and 3 do not apply to any requirements other
than the requirements listed in those paragraphs.


Article 1107: Senior Management and Boards of Directors

1.   A Party shall not require that an enterprise of the Party
that is an investment of an investor of another Party appoint to
senior management positions individuals of any particular
nationality.

2.   A Party may require that a majority of the board of
directors, or any committee thereof, of an enterprise of the
Party that is an investment of an investor of another Party, be
of a particular nationality, or resident in the territory of the
Party, provided that the requirement does not materially impair
the ability of the investor to exercise control over its
investment.


Article 1108: Reservations and Exceptions

1.   Articles 1102, 1103, 1106 and 1107 do not apply to:

     (a) any existing non-conforming measure that is maintained
 by:

     (i) a Party at the federal level, as described in its
 Schedule to Annex I or III,

     (ii) a state or province, for two years after the date
 of entry into force of this Agreement, and
 thereafter as described by a Party in its Schedule
 to Annex I, or

     (iii) a local government;

     (b) the continuation or prompt renewal of any
 non-conforming measure referred to in subparagraph (a);
 or

     (c) an amendment to any non-conforming measure referred to
 in subparagraph (a) to the extent that the amendment
 does not decrease the conformity of the measure, as it
 existed immediately before the amendment, with Articles
 1102, 1103, 1106 and 1107.

2.   A Party shall have two years from the date of entry into
force of this Agreement to describe in its Schedule to Annex I
any existing non-conforming measure maintained by a state or
province.

3.   A Party shall not be required to describe in its Schedule to
Annex I any existing non-conforming measure that is maintained by
a local government.

4.   To the extent indicated by a Party in its Schedule to Annex
II, Articles 1102, 1103, 1106 and 1107 do not apply to any
measure adopted or maintained by a Party with respect to the
sectors, subsectors or activities as described therein.

5.   Any measure adopted by a Party in a manner consistent with
paragraph 4 shall not require an investor of another Party, by
reason of its nationality, to sell or otherwise dispose of an
investment existing at the time the measure becomes effective.

6.   Articles 1102 and 1103 do not apply to any measure that is
an exception to, or derogation from, the obligations under
Article 1703 (National Treatment) as specifically provided for in
that Article.

7.   Article 1103 does not apply to treatment accorded by a Party
pursuant to agreements or with respect to sectors described in
Annex IV.

8.   Articles 1102, 1103 and 1107 do not apply to:

     (a) procurement of goods or services by a Party or a state
 enterprise; or

     (b) subsidies and grants provided by a Party or a state
 enterprise, including government-supported loans,
 guarantees and insurance.

9.   The provisions of:

     (a) Article 1106(1)(a), (b) and (c), and (3)(a) and (b) do
 not apply to qualification requirements for goods or
 services with respect to export promotion and foreign
 aid programs;

     (b) Article 1106(1)(b), (c), (f) and (g), and (3)(a) and
 (b) do not apply to procurement of goods or services by
 a Party or a state enterprise; and

     (c) Article 1106(3)(a) and (b) do not apply to requirements
 imposed by an importing Party related to the content of
 goods necessary to qualify for preferential tariffs or
 preferential quotas.

Article 1109: Transfers

1.   Each Party shall permit all transfers and international
payments ("transfers") relating to an investment of an investor
of another Party in the territory of the Party to be made freely
and without delay. Such transfers include:

     (a) profits, dividends, interest, capital gains, royalty
 payments, management fees, technical assistance and
 other fees, returns in kind, and other amounts derived
 from the investment;

     (b) proceeds from the sale of all or any part of the
 investment or from the partial or complete liquidation
 of the investment;

     (c) payments made under a contract entered into by the
 investor, or its investment, including payments made
 pursuant to a loan agreement;

     (d) payments made pursuant to Article 1110; and

     (e) payments arising under Subchapter B.

2.   Each Party shall permit transfers to be made in a freely
usable currency at the market rate of exchange prevailing on the
date of transfer with respect to spot transactions in the
currency to be transferred.

3.   No Party shall require its investors to transfer, or
penalize its investors who fail to transfer, the income,
earnings, profits or other amounts derived from, or attributable
to, an investment in the territory of another Party.

4.   Notwithstanding paragraphs 1 and 2, a Party may prevent a
transfer through the equitable, non-discriminatory and good faith
application of its laws relating to:

     (a) bankruptcy, insolvency or the protection of the rights
 of creditors;

     (b) issuing, trading or dealing in securities;

     (c) criminal or penal offenses;

     (d) reports of transfers of currency or other monetary
 instruments; or

     (e) ensuring the satisfaction of judgments in adjudicatory proceedings.

5.   Paragraph 3 shall not be construed to prevent a Party from
imposing any measure through the equitable, non-discriminatory
and good faith application of its laws relating to the matters
set out in subparagraphs (a) through (e) of paragraph 4.

6.   A Party may restrict transfers of returns in kind only in
circumstances in which it could otherwise restrict such transfers
under this Agreement.


Article 1110: Expropriation and Compensation

1.   No Party shall directly or indirectly nationalize or
expropriate an investment of an investor of another Party in its
territory or take a measure tantamount to nationalization or
expropriation of such an investment ("expropriation"), except:

     (a) for a public purpose;

     (b) on a non-discriminatory basis;

     (c) in accordance with due process of law and the general
 principles of treatment provided in Article 1105; and

     (d) upon payment of compensation in accordance with
 paragraphs 2 to 6.

2.   Compensation shall be equivalent to the fair market value of
the expropriated investment immediately before the expropriation
took place ("date of expropriation"), and shall not reflect any
change in value occurring because the intended expropriation had
become known earlier. Valuation criteria shall include going
concern value, asset value (including declared tax value of
tangible property) and other criteria, as appropriate to
determine fair market value.

3.   Compensation shall be paid without delay and be fully
realizable.

4.   If payment is made in a G7 currency, compensation shall
include interest at a commercially reasonable rate for that
currency from the date of expropriation until the date of actual
payment thereof.

5.   If a Party elects to pay in a currency other than a G7
currency, the amount paid on the date of payment, if converted
into a G7 currency at the market rate of exchange prevailing on
that date, shall be no less than if the amount of compensation
owed on the date of expropriation had been converted into that G7
currency at the market rate of exchange prevailing on that date,
and interest had accrued at a commercially reasonable rate for
that G7 currency from the date of expropriation until the date of
payment.

6.   Upon payment, compensation shall be freely transferable as
provided in Article 1109.

7.   This Article does not apply to the issuance of compulsory
licenses granted in relation to intellectual property rights, or
the revocation, limitation or creation of intellectual property
rights to the extent that such issuance, revocation, limitation
or creation is consistent with Chapter Seventeen (Intellectual
Property).

8.   For purposes of this Article and for greater clarity, a non-
discriminatory measure of general application shall not be
considered a measure tantamount to an expropriation of a debt
security or loan covered by this Chapter solely on the ground
that the measure imposes costs on the debtor that cause it to
default on the debt.


Article 1111: Special Formalities and Information Requirements

1.   Nothing in Article 1102 shall be construed to prevent a
Party from adopting or maintaining a measure that prescribes
special formalities in connection with the establishment of
investments by investors of another Party, such as a requirement
that investors be residents of the Party or that investments be
legally constituted under the laws and regulations of the Party,
provided that such formalities do not impair the substance of the
benefits of any of the provisions in this Chapter.

2.   Notwithstanding Articles 1102 and 1103, a Party may require,
from an investor of another Party or its investment, routine
business information, to be used solely for informational or
statistical purposes, concerning that investment in its
territory.  The Party shall protect such business information as
is confidential from disclosure that would prejudice the
investor's or the investment's competitive position.  Nothing in
this paragraph shall preclude a Party from otherwise obtaining or
disclosing information in connection with the equitable and good
faith application of its laws.


Article 1112: Relationship to Other Chapters

1.    In the event of any inconsistency between a provision of
this Chapter and a provision of another Chapter, the provision of
the other Chapter shall prevail to the extent of the
inconsistency.

2.   A requirement by a Party that a service provider of another
Party post a bond or other form of financial security as a
condition of providing a service into its territory does not of
itself make this Chapter applicable to the provision of that
cross-border service. This Chapter shall apply to that Party's
treatment of the posted bond or financial security.


Article 1113: Denial of Benefits

1.   Each Party reserves the right to deny to an investor of
another Party that is an enterprise of such Party and to
investments of such investor the benefits of this Chapter if
investors of a non-Party own or control the enterprise and:

     (a) the denying Party does not maintain diplomatic
 relations with the non-Party; or
     (b) the denying Party adopts or maintains measures with
 respect to the non-Party that prohibit transactions
 with the enterprise or that would be violated or
 circumvented if the benefits of this Chapter were
 accorded to the enterprise or to its investments.

2.   Subject to prior notification and consultation in accordance
with Articles 1803 (Notification and Provision of Information)
and 2006 (Consultations), respectively, each Party reserves the
right to deny to an investor of another Party that is an
enterprise of such Party and to investments of such investors the
benefits of this Chapter if investors of a non-Party own or
control the enterprise and the enterprise has no substantial
business activities in the territory of the Party under whose
laws it is constituted or organized.


Article 1114: Environmental Measures

1.   Nothing in this Chapter shall be construed to prevent a
Party from adopting, maintaining, or enforcing any measure,
otherwise consistent with this Chapter, that it considers
appropriate to ensure that investment activity in its territory
is undertaken in a manner sensitive to environmental concerns.

2.   The Parties recognize that it is inappropriate to encourage
investment by relaxing domestic health, safety or environmental
measures.  Accordingly, a Party should not waive or otherwise
derogate from, or offer to waive or otherwise derogate from, such
measures as an encouragement for the establishment, acquisition,
expansion, or retention in its territory of an investment of an
investor.  If a Party considers that another Party has offered
such an encouragement, it may request consultations with the
other Party and the two Parties shall consult with a view to
avoiding any such encouragement.

=============================================================================

        Subchapter B -  SETTLEMENT OF DISPUTES BETWEEN A PARTY AND
                       AN INVESTOR OF ANOTHER PARTY


Article 1115: Purpose

     This Subchapter establishes a mechanism for the settlement
of investment disputes that assures both equal treatment among
investors of the Parties in accordance with the principle of
international reciprocity and due process before an impartial
tribunal.


Article 1116: Claim by an Investor of a Party on Behalf of
 Itself

1.   An investor of a Party may submit to arbitration under this
Subchapter a claim that another Party has breached:

     (a) a provision of Subchapter A; or

     (b) Article 1502(3)(a) (Monopolies and State Enterprises)
 or Article 1503(2) (State Enterprises) where the
 alleged breach pertains to the obligations of
 Subchapter A,

and that the investor has incurred loss or damage by reason of,
or arising out of, that breach.

2.   An investor may not make a claim if more than three years
have elapsed from the date on which the investor first acquired,
or should have first acquired, knowledge of the alleged breach
and knowledge that the investor has incurred loss or damage.


Article 1117: Claim by an Investor of a Party on Behalf of an
 Enterprise

1.   An investor of a Party, on behalf of an enterprise of
another Party that is a juridical person that the investor owns
or controls directly or indirectly, may submit to arbitration
under this Subchapter a claim that the other Party has breached:

     (a) a provision of Subchapter A; or

     (b) Article 1502 (3)(a) (Monopolies and State Enterprises)
 or Article 1503(2) (State Enterprises) where the
 alleged breach pertains to the obligations of
 Subchapter A;

and that the enterprise has incurred loss or damage by reason of,
or arising out of, that breach.

2.   An investor may not make a claim on behalf of an enterprise
described in paragraph 1 if more than three years have elapsed
from the date on which the enterprise first acquired, or should
have first acquired, knowledge of the alleged breach and
knowledge that the enterprise has incurred loss or damage.

3.   Where an investor makes a claim under this Article and the
investor or a non-controlling investor in the enterprise makes a
claim under Article 1116 arising out of the same events which
gave rise to the claim under this Article, and two or more of the
claims are submitted to arbitration under Article 1120, the
claims should be heard together by a Tribunal established
pursuant to Article 1125, unless the Tribunal finds that the
interests of a disputing party would be prejudiced thereby.

4.   An investment may not make a claim under this Subchapter.


Article 1118: Settlement of a Claim Through Consultation and
 Negotiation

     The disputing parties should first attempt to settle a claim
through consultation or negotiation.


Article 1119: Notice of Intent to Submit a Claim to Arbitration

     The disputing investor shall give to the disputing Party
written notice of its intention to submit a claim to arbitration
at least 90 days before the claim is submitted, which notice
shall specify:

     (a) the name and address of the disputing investor;

     (b) the provisions of this Agreement alleged to have been
 breached and any other relevant provisions;

     (c) the issues and the factual basis for the claim; and

     (d) the relief sought and the approximate amount of damages
 claimed.


Article 1120: Submission of a Claim to Arbitration

1.   Except as provided in Annex 1120.1, and provided that six
months have elapsed since the events giving rise to a claim, a
disputing investor may submit the claim to arbitration under:

     (a) the ICSID Convention, provided that both the disputing
 Party and the Party of the investor are parties to the
 Convention;

     (b) the Additional Facility Rules of ICSID, provided that
 either the disputing Party or the Party of the
 investor, but not both, is a party to the ICSID
 Convention; or

     (c) the UNCITRAL Arbitration Rules.

2.   The applicable arbitration rules shall govern the
arbitration except to the extent modified by this Subchapter.


Article 1121: Conditions Precedent to Submission of a Claim to
 Arbitration

1.   A disputing investor may submit a claim under Article 1116
to arbitration only if:

     (a) the investor consents to arbitration in accordance with
 the provisions of this Subchapter; and

     (b) both the investor and an enterprise of another Party
 that is a juridical person that the investor owns or
 controls directly or indirectly, waive their right to
 initiate or continue before any administrative tribunal
 or court under the domestic law of any Party any
 proceedings with respect to the measure of the
 disputing Party that is alleged to be a breach of
 Subchapter A of this Chapter, Article 1502(3)(a)
 (Monopolies and State Enterprises) or Article 1503(2)
 (State Enterprises), except for proceedings for
 injunctive, declaratory or other extraordinary relief,
 not involving the payment of damages, before an
 administrative tribunal or court under the domestic law
 of the disputing Party.

2.   A disputing investor may submit a claim under Article 1117
to arbitration only if both the investor and the enterprise:

     (a) consent to arbitration in accordance with the
 provisions of this Subchapter; and

     (b) waive their right to initiate or continue before any
 administrative tribunal or court under the domestic law
 of any Party any proceedings with respect to the
 measure of the disputing Party that is alleged to be a
 breach of Subchapter A of this Chapter, Article
 1502(3)(a) (Monopolies and State Enterprises) or
 Article 1503(2) (State Enterprises), except for
 proceedings for injunctive, declaratory or other
 extraordinary relief, not involving the payment of
 damages, before an administrative tribunal or court
 under the domestic law of the disputing Party.

3.   A consent and waiver required by this Article shall be in
writing, shall be given to the disputing Party, and shall be
included in the submission of a claim to arbitration.


Article 1122: Consent to Arbitration

1.   Each Party consents to the submission of a claim to
arbitration in accordance with the provisions of this Subchapter.

2.   The consent given by paragraph 1 and the submission by a
disputing investor of a claim to arbitration in accordance with
the provisions of this Subchapter shall satisfy the requirement
of:

     (a) Chapter II of the ICSID Convention (Jurisdiction of the
 Center) and the Additional Facility Rules for written
 consent of the parties;

     (b) Article II of the New York Convention for an agreement
 in writing; and

     (c) Article I of the Inter-American Convention for an
 agreement.


Article 1123: Number of Arbitrators and Method of Appointment

     Subject to Article 1125, and unless the disputing parties
agree otherwise, the Tribunal shall consist of three arbitrators.
One arbitrator shall be appointed by each of the disputing
parties.  The third, who shall be the presiding arbitrator, shall
be appointed by agreement of the disputing parties.


Article 1124: Constitution of Tribunal When a Party Fails to
 Appoint an Arbitrator or the Disputing Parties Are
 Unable to Agree on a Presiding Arbitrator

1.   The Secretary-General of ICSID shall serve as appointing
authority for an arbitration under this Subchapter.

2.   If a Tribunal has not been constituted within 90 days from
the date that a claim is submitted to arbitration, the Secretary-
General, at the request of either disputing party:

     (a) shall appoint the arbitrator or arbitrators not yet
 appointed in his discretion, except for the presiding
 arbitrator; and

     (b) shall appoint the presiding arbitrator in accordance
 with paragraph 3.

3.   The Secretary-General shall appoint the presiding arbitrator
from the list of presiding arbitrators described in paragraph 4.
In the event that no such presiding arbitrator is available to
serve, the Secretary-General shall appoint a presiding arbitrator
who is not a national of any of the Parties from the ICSID Panel
of Arbitrators.

4.   As of the date of entry into force of this Agreement, the
Parties shall have jointly designated, without regard to
nationality, 45 presiding arbitrators meeting the qualifications
of the rules referred to in Article 1120 and experienced in
international law and investment.

5.   Subject to paragraph 8, where a disputing investor submits a
claim to arbitration under the ICSID Convention or the Additional
Facility Rules, each Party agrees:

     (a) to the appointment by the investor of a national of the
 Party of the investor as an arbitrator; and

     (b) to the appointment by the Secretary-General of a
 national of the Party of the investor as an arbitrator
 or as a presiding arbitrator.

6.   Subject to paragraph 8, a disputing investor described in
Article 1116 may submit a claim to arbitration, or continue a
claim, under the ICSID Convention or the Additional Facility
Rules, only on the following conditions:

     (a) where the disputing Party appoints a national of the
 disputing Party as an arbitrator, the investor agrees
 in writing to the appointment; and

     (b) where the Secretary-General appoints a national of the
 disputing Party as an arbitrator or as a presiding
 arbitrator, the investor agrees in writing to the
 appointment.

7.   Subject to paragraph 8, a disputing investor described in
Article 1117(1) may submit a claim to arbitration, or continue a
claim, under the ICSID Convention or the Additional Facility
Rules, only on the following conditions:

     (a) where the disputing Party appoints a national of the
 disputing Party as an arbitrator, the investor and the
 enterprise agree in writing to the appointment; and

     (b) where the Secretary-General appoints a national of the
 disputing Party as an arbitrator or as a presiding
 arbitrator, the investor and the enterprise agree in
 writing to the appointment.

8.   A disputing party:

     (a) in the case of a claim submitted to arbitration under
 the ICSID Convention, may propose, under Article 57 of
 the Convention, the disqualification of a member of the
 Tribunal on account of any fact indicating a manifest
 lack of the qualities required by paragraph 1 of
 Article 14 of the Convention; and

     (b) in the case of a claim submitted to arbitration under
 the Additional Facility Rules, may propose, under
 Article 14 of the Rules, the disqualification of a
 member of the Tribunal on account of any fact
 indicating a manifest lack of the qualities required by
 Article 9 of the Rules.

Article 1125: Consolidation

1.   A Tribunal established under this Article shall be
established under the UNCITRAL Arbitration Rules, and shall
conduct its proceedings in accordance with those Rules, except as
modified by this Subchapter.

2.   Where a Tribunal established under this Article is satisfied
that claims have been submitted to arbitration under Article 1120
that have a question of law or fact in common, the Tribunal may,
in the interests of fair and efficient resolution of the claims,
and after hearing the disputing parties, order that the Tribunal:

     (a) shall assume jurisdiction over, and hear and determine
 together, all or part of the claims; or

     (b) shall assume jurisdiction over, and hear and determine
 one or more of the claims, the determination of which
 it believes would assist in the resolution of the
 others.

3.   A disputing party that seeks an order under paragraph 2
shall request the Secretary-General of ICSID to establish a
Tribunal and shall specify in the request:

     (a) the name of the disputing Party or disputing parties
 against which the order is sought;

     (b) the nature of the order sought; and

     (c) the grounds on which the order is sought.

4.   The disputing party shall give to the disputing Party or
disputing parties against which the order is sought a copy of the
request.

5.   Within 60 days of receipt of the request, the Secretary-
General of ICSID shall establish a Tribunal consisting of three
arbitrators.  The Secretary-General shall appoint the presiding
arbitrator from the roster described in paragraph 4 of Article
1124.  In the event that no such presiding arbitrator is
available to serve, the Secretary-General shall appoint a
presiding arbitrator, who is not a national of any of the
Parties, from the ICSID Panel of Arbitrators.  The Secretary-
General shall appoint the two other members from the roster
described in paragraph 4 of Article 1124, and to the extent not
available from that roster, from the ICSID Panel of Arbitrators,
and to the extent not available from that panel, in the
discretion of the Secretary-General.  One member shall be a
national of the disputing Party and one member shall be a
national of the Party of the disputing investors.

6.   Where a Tribunal has been established under this Article, a
disputing party that has not been named in a request made under
paragraph 3 may make a written request to the Tribunal that it be
included in an order made under paragraph 2, and shall specify in
the request:

     (a) the party's name and address;

     (b) the nature of the order sought; and

     (c) the grounds on which the order is sought.

7.   A disputing party described in paragraph 6 shall give a copy
of its request to the parties named in a request made under
paragraph 3.

8.   A Tribunal established under Article 1120 shall not have
jurisdiction to decide a claim, or a part of a claim, over which
a Tribunal established under this Article has assumed
jurisdiction.

9.   A disputing Party shall give to the Secretariat of the
Commission, within 15 days of receipt by the disputing Party, a
copy of:

     (a) a request for arbitration made under paragraph 1 of
 Article 36 of the ICSID Convention;

     (b) a notice for arbitration made under Article 2 of the
 Additional Facility Rules; or

     (c) a notice of arbitration given under the UNCITRAL
 Arbitration Rules.

10.  A disputing Party shall give to the Secretariat of the
Commission a copy of a request made under paragraph 3 of this
Article:

     (a) within 15 days of receipt of the request, in the case
 of a request made by a disputing investor;

     (b) within 15 days of making the request, in the case of a
 request made by the disputing Party.

11.  A disputing Party shall give to the Secretariat of the
Commission a copy of a request made under paragraph 6 of this
Article within 15 days of receipt of the request.

12.  The Secretariat of the Commission shall maintain a public
register consisting of the documents referred to in paragraphs 9,
10 and 11.


Article 1126: Notice

     A disputing Party shall deliver to the other Parties:

     (a) written notice of a claim that has been submitted to
 arbitration within 30 days from the date that the claim
 is submitted; and

     (b) copies of all pleading filed in the arbitration.


Article 1127: Participation by a Party

     On written notice to the disputing parties, a Party may make
submissions to a Tribunal on a question of interpretation of this
Agreement.


Article 1128: Documents

     A Party shall be entitled to receive from the disputing
Party at the cost of the requesting Party:

     (a) a copy of the evidence that has been tendered to the
 Tribunal; and

     (b) a copy of the written argument of the disputing
 parties.


Article 1129: Place of Arbitration

     Unless the disputing parties agree otherwise, a Tribunal
shall hold an arbitration in the territory of a Party which is a
party to the New York Convention, selected in accordance with:

     (a) the Additional Facility Rules if the arbitration is
 under those rules or the ICSID Arbitration Rules; or

     (b) the UNCITRAL Arbitration Rules if the arbitration is
 under those rules.


Article 1130: Governing Law

     A Tribunal established under this Subchapter shall decide
the issues in dispute in accordance with this Agreement and
applicable rules of international law.


Article 1131: Interpretation of Annexes

1.   Where a disputing Party asserts as a defense that the
measure alleged to be a breach of this Chapter is within the
scope of an exception set forth in Annex I, Annex II, Annex III
or Annex IV, on request of the disputing Party, the Tribunal
shall request the interpretation of the Commission on this
question.  The Commission shall have 60 days to submit its
interpretation in writing to the Tribunal.

2.   If the Commission submits to the Tribunal an agreed
interpretation, the interpretation shall be binding on the
Tribunal.  If the Commission fails to submit an agreed
interpretation or fails to submit an agreed interpretation within
such 60 day period, the Tribunal shall decide the issue of
interpretation of the exception.


Article 1132: Report from an Expert

     Without prejudice to the appointment of other kinds of
experts where authorized by the applicable arbitration rules, a
Tribunal, at the request of a disputing party or, unless the
disputing parties disapprove, on its own initiative, may appoint
one or more experts to report to it in writing on any factual
issue concerning environmental, health, safety or other
scientific matters raised by a disputing party in a proceeding,
subject to such terms and conditions as the disputing parties may
agree.


Article 1133: Interim Measures of Protection

     A Tribunal may take such measures as it deems necessary to
preserve the respective rights of the disputing parties, or to
ensure that the Tribunal's jurisdiction is made fully effective.
Such measures may include, but are not limited to, orders to
preserve evidence in the possession or control of a disputing
party, or to protect the Tribunal's jurisdiction.  An interim
measure of protection may not include an order of attachment or
an order to enjoin the application of the measure alleged to be
the breach of Subchapter A of this Chapter, Article 1502(3)(a)
(Monopolies and State Enterprises) or Article 1503(2) (State
Enterprises).  For purposes of this paragraph, an order includes
a recommendation.


Article 1134: Final Award

1.   Where a Tribunal makes a final award against a Party, the
Tribunal may award only:

     (a) monetary damages, and any applicable interest; or

     (b) restitution of property, in which case the award shall
 provide that the disputing Party may pay monetary
 damages, and any applicable interest, in lieu of
 restitution.

2.   Subject to paragraph 1, where a claim is made under
paragraph 1 of Article 1117:

     (a) an award of restitution of property shall provide that
 restitution be made to the enterprise;

     (b) an award of monetary damages, and any applicable
 interest, shall provide that the sum be paid to the
 enterprise; and

     (c) the award shall provide that it is made without
 prejudice to any right that any person may have in the
 relief under applicable domestic law.

3.   A Tribunal may not order a Party to pay punitive damages.


Article 1135: Finality and Enforcement of Award

1.   An award made by a Tribunal is binding on the disputing
parties but shall have no binding force except between the
disputing parties and in respect of the particular case.

2.   Subject to paragraph 3, a disputing party shall abide by and
comply with an award without delay.

3.   A disputing party may not seek enforcement of a final award
until:

     (a) in the case of a final award made under the ICSID
 Convention:

     (i) 120 days have elapsed from the date the award was
 rendered and no disputing party has requested
 revision or annulment of the award, or

     (ii) revision or annulment proceedings have been
 completed, and

     (b) in the case of a final award under the Additional
 Facility Rules of ICSID or the UNCITRAL Arbitration
 Rules:

     (i) 3 months have elapsed from the date the award was
 rendered and no disputing party has commenced a
 proceeding to revise, set aside or annul the
 award, or

     (ii) a court has dismissed or allowed an application to
 revise, set aside or annul the award and there is
 no further appeal.

5.   Each Party undertakes to provide for the enforcement in its
territory of an award.

6.   If a Party fails to abide by or comply with the terms of a
final award under this Subchapter, the Commission provided for in
Chapter Twenty (Institutional Arrangements and Dispute Settlement
Procedures) shall, upon delivery of a request by any other Party
whose investor was party to the investment dispute, establish a
panel under Article 2008(1).  The requesting Party may seek in
such proceedings:

     (a) a determination that the failure to abide by and comply
 with the terms of the final award is inconsistent with
 the obligations of this Agreement; and

     (b) a recommendation that the defaulting Party abide by or
 comply with the terms of the final award.

7.   A disputing investor may seek enforcement of an arbitration
award under the ICSID Convention, the New York Convention or the
Inter-American Convention regardless of whether proceedings have
been taken under paragraph 6.

8.   A claim that is submitted to arbitration shall be considered
to arise out of a commercial relationship or transaction for
purposes of Article I of the New York Convention and Article I of
the Inter-American Convention.


Article 1136: General

1.   Time when a Claim is Submitted to Arbitration:  A claim is
submitted to arbitration under this Subchapter when:

     (a) the notice of registration of the request to institute
 arbitration proceedings has been dispatched by the
 Secretary-General of ICSID in accordance with paragraph
 3 of Article 36 of the ICSID Convention;

     (b) the certificate of registration of the notice for
 arbitration has been dispatched by the Secretary-
 General of ICSID in accordance with Article 4 of
 Schedule C of the Additional Facility Rules; or

     (c) the notice of arbitration given under the UNCITRAL
 Arbitration Rules is received by the disputing Party.

2.   Receipts under Insurance or Guarantee Contracts:  In an
arbitration under this Subchapter, a Party shall not assert, as a
defense, counterclaim, right of set off or otherwise, that the
investor concerned has received or will receive, pursuant to an
insurance or guarantee contract, indemnification or other
compensation for all or part of its alleged
damages.


Article 1137: Exclusions

1.   Without prejudice to the applicability or non-applicability
of the dispute settlement provisions of this Subchapter or of
Chapter Twenty (Institutional Arrangements and Dispute Settlement
Procedures) to other actions taken by a Party pursuant to Article
2102 (National Security), a decision by a Party to prohibit or
restrict the acquisition of an investment in its territory by an
investor of another Party, or its investment, pursuant to that
Article shall not be subject to such provisions.

2.   The dispute settlement provisions of this Subchapter and of
Chapter Twenty shall not apply to the matters described in Annex
1137.2.


Article 1138: Definitions

For purposes of this Chapter:

disputing Party means a Party against which a claim is made under
Subchapter B;

disputing party means the disputing investor or the disputing
Party;

disputing parties means the disputing investor and the disputing Party;

enterprise means an "enterprise" as defined in Article 201,
except that it shall also include a branch;

enterprise of a Party means an enterprise constituted or
organized under the laws and regulations of a Party, and a
branch;

equity or debt securities includes voting and non-voting shares,
bonds, convertible debentures, stock options and warrants;

G7 Currency means the currency of Canada, Germany, France, Italy,
Japan, the United States or the United Kingdom of Great Britain
and Northern Ireland;

ICSID Convention means the Convention on the Settlement of
Investment Disputes between States and Nationals of other States
done at Washington, March 18, 1965;

ICSID means the International Centre for Settlement of Investment
Disputes;

Inter-American Convention means the Inter-American Convention on
International Commercial Arbitration, done at Panama, January 30,
1975;

investment means:

     (a) an enterprise;

     (b) an equity security of an enterprise;

     (c) a debt security of an enterprise

     (i) that is an affiliate of the investor, or

     (ii) where the original maturity of the debt security
 is at least three years,

     but does not include a debt security, regardless of original
     maturity, of a state enterprise;

     (d) a loan to an enterprise,

     (i) that is an affiliate of the investor, or

     (ii) where the original maturity of the loan is at
 least three years,

     but does not include a loan, regardless of original
     maturity, to a state enterprise;

     (e) an interest in an enterprise that entitles the owner to
 share in the income or profits;

     (f) an interest in an enterprise that entitles the owner to
 share in the assets on dissolution, other than a debt
 security or a loan excluded from sub-paragraph (c) or
 (d);

     (g) real estate or other property (tangible and intangible)
 acquired in the expectation or used for the purpose of
 economic benefit or other business purposes;

     (h) interests arising from the commitment of capital or
 other resources in the territory of a Party to economic
 activity in such territory, such as under:

     (i) contracts involving the presence of an investor's
 property in the territory of the Party (including
 turnkey or construction contracts, or
 concessions), or

     (ii) contracts where the remuneration depends
 substantially on the production, revenues or
 profits of an enterprise.

But investment does not mean,

     (i) claims to money that arise solely from:

     (i) commercial contracts for the sale of goods or
 services by a national or enterprise in the
 territory of one Party to an enterprise in the
 territory of another Party, or

     (ii) the extension of credit in connection with a
 commercial transaction, such as trade financing,
 other than a loan covered by sub-paragraph (d), or

     (j) any other claims to money,

which do not involve the kinds of interests set out in sub-
paragraphs (a) through (h);

investment of an investor of a Party means an investment owned or
controlled directly or indirectly by an investor of such Party;

investor of a Party means a Party or state enterprise thereof, or
a national or an enterprise of such Party, that seeks to make,
makes or has made an investment;

investor of a non-Party means an investor other than an investor
of a Party, that makes, seeks to make or has made an investment;

New York Convention means the United Nations Convention on the
Recognition and Enforcement of Foreign Arbitral Awards, done at
New York, June 10, 1958;

Tribunal means an arbitration tribunal established under Article
1120 or 1125; and

UNCITRAL Arbitration rules means the arbitration rules of the
United Nations \Commission on International Trade Law, approved
by the United Nations General Assembly on December 15, 1976.

=============================================================================

                               ANNEX 1120.1

                    Submission of Claims to Arbitration

1.   An investor of another Party may not allege that Mexico has
breached:

     (a) a provision of Subchapter A; or

     (b) Article 1502(3)(a) (Monopolies and State Enterprises)
 or Article 1503(2) (State Enterprises) where the
 alleged breach pertains to the obligations of
 Subchapter A,

both in an arbitration under this Subchapter and in proceedings
before a Mexican court or administrative tribunal.

2.   Where an enterprise of Mexico that is a juridical person
that an investor of another Party owns or controls directly or
indirectly alleges in proceedings before a Mexican court or
administrative tribunal that Mexico has breached:

     (a) a provision of Subchapter A; or

     (b) Article 1502(3)(a) (Monopolies and State Enterprises)
 or Article 1503(2) (State Enterprises) where the
 alleged breach pertains to the obligations of
 Subchapter A,

the investor may not allege the breach in an arbitration under
this Subchapter.

=============================================================================
                               ANNEX 1137.2

                    Exclusions from Dispute Settlement



CANADA

     A decision by Canada following a review under the Investment
Canada Act, with respect to whether or not to permit an
acquisition that is subject to review, shall not be subject to
the dispute settlement provisions of Subchapter B or of Chapter
Twenty (Institutional Arrangements and Dispute Settlement
Procedures).

MEXICO

     A decision by the National Commission on Foreign Investment
("Comisi¢n Nacional de Inversiones Extranjeras") following a
review pursuant to Annex I, page I-M-7, with respect to whether
or not to permit an acquisition that is subject to review, shall
not be subject to the dispute settlement provisions of Subchapter
B or of Chapter Twenty (Institutional Arrangements and Dispute
Settlement Procedures).