Analysis of the Draft Text

This report by the Center for International Environmental Law analyzes a leaked draft of the investment chapter of the Free Trade Area of the Americas (FTAA). The analysis concludes that the draft largely mirrors or expands upon the investor-state protections found in NAFTA Chapter 11, which the authors argue undermines democratic governance, environmental protection, and national sovereignty by granting corporations the power to challenge domestic laws in international tribunals.

• The draft FTAA investment chapter incorporates a dispute settlement mechanism nearly identical to NAFTA Chapter 11, allowing foreign corporations to bypass domestic courts and use international arbitration to challenge democratically enacted laws and regulations.
• The draft proposes broad definitions of expropriation that include direct, indirect, and measures 'tantamount to' expropriation, which the authors claim enables corporations to sue governments over any act that reduces their profits.
• The draft includes a 'minimum standard of treatment' obligation that is vague and open-ended. The authors note that this provision has been used in all successful NAFTA claims to date and can be used to import obligations from outside the investment rules into investor-state claims.
• The proposed FTAA would restrict the use of capital controls more severely than NAFTA, explicitly requiring the free transfer of contributions to capital, royalties, and payments related to intellectual property and natural resources.
• The draft mandates 'national treatment,' requiring governments to treat foreign investors as favorably as domestic ones. While exceptions (reservations) are possible, they are limited to a one-time listing of existing measures, and the authors highlight a lack of public and parliamentary consultation regarding these reservations.
• The draft repeats NAFTA's broad ban on performance requirements—conditions used to ensure investments support host country goals—such as requirements for domestic content or technology transfer.
• Negotiators are considering several alternative definitions of 'investment,' many of which are broader than NAFTA's. Some proposals would extend protections to intellectual property rights, derivatives, licenses, and commercial contracts.

APA

L., M. P. R., Porter, S., Anderson, S., Dillon, J., Lee, M., Sinclair, S., Traynor, K., & Shrybman, S. (n.d.). Analysis of the Draft Text. Center for International Environmental Law. https://www.ciel.org/wp-content/uploads/2015/05/HSAInvestmentAnalysisFinal.pdf

Chicago

L., Manuel Perez Rocha, Steve Porter, Sarah Anderson, John Dillon, Marc Lee, Scott Sinclair, Ken Traynor, and Steve Shrybman. Analysis of the Draft Text. Center for International Environmental Law, n.d. https://www.ciel.org/wp-content/uploads/2015/05/HSAInvestmentAnalysisFinal.pdf.

Wikipedia

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BibTeX

@techreport{lndanalysis, author = {L., Manuel Perez Rocha and Porter, Steve and Anderson, Sarah and Dillon, John and Lee, Marc and Sinclair, Scott and Traynor, Ken and Shrybman, Steve}, title = {{Analysis of the Draft Text}}, institution = {Center for International Environmental Law}, url = {https://www.ciel.org/wp-content/uploads/2015/05/HSAInvestmentAnalysisFinal.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }