Category Archives: International Law

Raising Questions About the Use of an Offset For Compliance with Carbon Emission Reduction Obligations

By: Shaun Fluker

PDF Version: Raising Questions About the Use of an Offset For Compliance with Carbon Emission Reduction Obligations

Case Commented On: Citizen’s Climate Lobby and Our Children’s Earth Foundation v California Air Resources Board (Superior Court of California, County of San Francisco, January 25, 2013, Case number CGC-2-519544)

This comment examines a recent judicial review decision by the Superior Court of California dismissing a challenge to the legality of the carbon emission offset regime established by California’s Air Resources Board (CARB). The petitioners in this case alleged the offset regime does not comply with its parent statute – the Global Warming Solutions Act of 2006, (California, AB 32) – and thus the CARB does not have legal authority to implement it. The essence of the claim was that a carbon emission offset created by the CARB regime would not necessarily represent the real and demonstrable carbon emission reduction required by the legislation. The Court ruled the offset regime created and administered by the CARB complies with the legislation.

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From Regulatory Chill to Regulatory Concussion: NAFTA’s Prohibition on Domestic Performance Requirements and an Absurdly Narrow Interpretation of Country Specific Reservations

PDF version: From Regulatory Chill to Regulatory Concussion: NAFTA’s Prohibition on Domestic Performance Requirements and an Absurdly Narrow Interpretation of Country Specific Reservations

Award commented on: Mobil Investments Canada Inc. and Murphy Oil Corporation v Canada, ICSID Case No ARB(AF)/07/4. Decision on Liability and Principles of Quantum, dispatched to the parties, May 22, 2012, redacted version released in the fall of 2012. Both the majority award (206pp) and a partial dissenting award (Professor Philippe Sands QC) are available here.

Case commented on: Hibernia Management and Development Company Ltd. v Canada-Newfoundland and Labrador Offshore Petroleum Board, 2008 NLCA 46 (CanLII)

In this Award a NAFTA Tribunal (by a Majority) found that Canada was in breach of the prohibition on domestic performance requirements of Article 1106 of NAFTA when the Canada Newfoundland Offshore Petroleum Board (CNOPB or Board) established and imposed a research investment target (the 2004 Guidelines) on operators working on the Newfoundland continental shelf. In doing so the Majority of the Tribunal ruled that Canada could not rely upon its country specific reservation. While Canada’s reservation protected the performance requirements that were in place at the time that NAFTA was entered into it did not protect the 2004 Guidelines. In reaching this conclusion the Majority severely constrains the ability of the host state to adopt new subordinate measures (e.g. regulations, guidelines and policies) to give effect to a reserved power. In effect, the Majority has adopted a one-way ratchet in which any subordinate measure adopted by a state that does not fully exploit the entire space offered by the text of a reservation may make it impossible for the host state to recover the lost ground. This, as the Dissent lucidly demonstrates, is an unreasonably narrow construction of the power of each NAFTA state to take a reservation to its general commitment not to impose domestic performance requirements on investors.

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Low Carbon Energy Policies: Vested Rights, Legitimate Expectations, and Differential Treatment in Domestic and International Law

By: Nigel Bankes

PDF Version: Low Carbon Energy Policies: Vested Rights, Legitimate Expectations, and Differential Treatment in Domestic and International Law

Cases and Matters Commented On: Secretary of State for Climate Change v Friends of the Earth and Others, [2012] EWCA Civ. 28,  aff’g lower decision; Mesa Power Group LLC v Government of Canada, Notice of Intent to Submit a Claim to Arbitration under Chapter Eleven of NAFTA, July 6, 2011; Mercer International Inc v Government of Canada, Notice of Intent to Submit a Claim to Arbitration under Chapter Eleven of NAFTA, 26 January 2012, and request for arbitration (ICSID Additional Facility), April 30, 2012

Governments around the world are adopting a variety of low carbon and green energy policies designed to increase the share of renewable energy sources in the energy mix. In addition, some governments, including the government of Alberta, have also adopted policies to provide for the sequestration of carbon dioxide emissions where carbon fuels continue to make up a significant part of the energy mix. These policies often provide financial incentives to investors in order to persuade them to commit to the new technology. For example, many governments provide for feed-in-tariffs (FIT) to encourage the development of wind and solar energy. A FIT represents a commitment by the government directly or through the incumbent utility to purchase the output from the designated facility (e.g. wind generator, solar panels or biomass generation) at a specified price for a prescribed number of years (typically representing the amortization period of the asset). Such commitments are designed to be “bankable” in the sense that the proponent will be able to use the commitment to raise capital to fund the venture. Similarly, many governments have found it necessary to provide financial support (subsidies or “state aid” in the language of the European Union) for the first commercial scale carbon capture and storage projects. For example, the province of Alberta is currently providing support for three different sequestration related projects in the province (see here). Continue reading →

The implications of the Tsilhqot’in Case for the Numbered Treaties

PDF version: The implications of the Tsilhqot’in Case for the Numbered Treaties

Cases Considered: Williams v British Columbia, 2012 BCCA 285, and Lameman v Alberta, 2012 ABQB 195

The unanimous decision of the British Columbia in Williams, (a.k.a. the Tsilhqot’in land claim case or the Brittany Triangle case) continues the trend in Canadian case law (beginning with R v Marshall; R v Bernard, 2005 SCR 43) of insisting that a claimant First Nation or other aboriginal people must establish exclusive occupation of particular tracts of land in order to obtain a declaration of aboriginal title.  Indeed, the case comes close to suggesting, and as a matter of law, that a claimant people will hardly ever\never succeed on the basis of what the court describes as a territorial claim (at para 219) i.e. the claim that these lands (e.g. a particular watershed) are our lands because we were present in that territory (at para 206), living in accordance with our laws (including property laws) and using that territory to the exclusion of all others.

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Do Global Law Firm Mergers Expand an Arbitrator’s Continuing Obligation to Disclose Conflicts of Interest Under the ICSID Arbitration Rules?

PDF version: Do Global Law Firm Mergers Expand an Arbitrator’s Continuing Obligation to Disclose Conflicts of Interest Under the ICSID Arbitration Rules? 

Decision considered: ConocoPhillips Company et al. v The Bolivarian Republic of Venezuela

Two members of an ICSID arbitral tribunal – the Honourable Judge Kenneth J. Keith and Professor Georges Abi-Saab – have dismissed Venezuela’s challenge to the tribunal’s third member, Mr. L. Yves Fortier.

Venezuela filed a formal proposal to disqualify Mr. Fortier on October 5, 2011, one day after Mr. Fortier made a disclosure to the ICSID Secretary-General regarding the upcoming merger of Norton Rose OR LLP (“Norton Rose”), the firm in which he was a partner, and Macleod Dixon LLP (“Macleod Dixon”). Macleod Dixon was a Canadian-based law firm with international offices in, among other regions, South America. Venezuela’s proposal to disqualify Mr. Fortier arose out of concerns related to Macleod Dixon’s Caracas office. Specifically, Venezuela had concerns about “the extent and depth” of that office’s representation of ConocoPhillips (the Claimant in this arbitration) and other clients in matters adverse to Venezuela, its state-owned petroleum company and/or affiliates.

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