Contributing Lawyers

Canada

Cyndee Todgham Cherniak

United States

Susan Kohn Ross

Australia

Andrew Hudson



Abitibi-Bowater Filed NAFTA Chapter 11 Notice of Intent

On April 23, 2009, AbitibiBowater Inc. filed a notice of intent under the North American free-trade agreement accusing the Newfoundland and Labrador government of taking a “blatantly discriminatory” action when it passed legislation (Bill 75) in December 2008  to expropriate its hydroelectric assets, and water and timber rights in Grand Falls-Windsor.  The filing does not come as a surprise to those who have been following the actions of Premier Danny Williams.

AbitibiBowater says the expropriation violates Canada's obligations under NAFTA because it does not ensure payment for the fair market value of its expropriated assets and rights. It is seeking more than $300-million in direct compensation plus additional costs.

The notice of intent is rather long in comparison to many NAFTA Chapter 11 notices that have been filed in the past. Some of the statements in the notice of intent include:

  • “The act simply singled out one such company for retaliatory expropriation, and dressed up its punitive actions with populist rhetoric designed to loosely suggest [but not really reflect] rational public policy goals,”
  • “The real motivation, and the real consequence of the act, was simple. It was to kick a single foreign investor out of the province because that investor had angered Premier Williams and some of his constituents.”

For a copy of the notice of intent, please go to the following link - http://www.cbc.ca/news/pdf/nl-nafta-20090423.pdf

Also, please go to the following link for more information - http://www.bowater.com/media/latest-news.aspx?detail=true&reqid=1279914

It should be noted that the Governmnet of Canada is the party against whom the NAFTA Chapter 11 case was filed and not the Government of the province of Newfoudland and Labrador.  The Government of Canada will have to defend the actions of Premier Williams - that will be interesting to watch.  For those readers outside Canada, Premier Williams (a Conservative) has not had kind words to say about Prime Minister Harper (also Conservative) and contributed to the loss of conservative voted in Newfoundland/labrador in the last federal election.

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