Originally from: Annulment of ICSID Awards

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The British Columbia Supreme Court’s decision in The United Mexican States v. Metalclad Corp.  is the first example of a national court’s decision on a challenge of an arbitral award rendered pursuant to Chapter 11 of the North American Free Trade Agreement (“NAFTA”).  It offers an interesting opportunity to examine the relationship between arbitration commenced pursuant to the terms of an international treaty that protects private investments and the jurisdiction of national courts.  The Metalclad case is of particular interest for present purposes since the arbitration was conducted under ICSID’s Arbitration (Additional Facility) Rules.  As in the case of other aspects of arbitration pursuant to NAFTA’s Chapter 11, the question of challenge and enforcement of awards gives rise to novel issues and some surprises.