68 LEXPERT MAGAZINE
|
NOVEMBER/DECEMBER 2016
FEATURE
EVEN AS CANADA
hustles to play catch-up on the international trade scene through its
ongoing pursuit of bilateral investment treaties (BITs) with developed and emerging nations, it faces
its first non-NAFTA investment claim and the first BIT claim against it by a developing-country
investor — and from no less a trading power than Egypt.
e claim comes in the form of a request for arbitration by Global Telecom Holding (GTH),
registered in June with the International Centre for Settlement of Investment Disputes (ICSID)
under the Canada-Egypt BIT of 1996. e parties have not yet provided details, but the dispute
almost certainly arises from the failed attempt by GTH (operating as Orascom Telephone) to buy a
controlling interest in Wind Mobile Canada, a wireless service provider, about three years ago. GTH
maintains that it was treated unfairly by the Canadian government, forcing it to withdraw its bid.
e irony here is palpable. Aer all, investor-state dispute-resolution mechanisms were originally
intended to protect investors from developed countries against unfair treatment from developing
countries, where democracy and the rule of law were not necessarily priorities. As far back as 1994,
NAFTA's Chapter 11 was included in the treaty to protect US and Canadian investors against cor-
ruption in Mexico. "Investor-state disputes were intended to depoliticize the process," says Tina
Cicchetti of Fasken Martineau DuMoulin LLP in Vancouver. "It used to be that the best available
option for investors was try to convince their governments to either negotiate for them or pull up the
gunboats to resolve what was essentially a commercial dispute."
Protectionism
Treaties drafted to protect
Canadian investors from
erratic regimes are now
backfiring, as investors
abroad, like Wind Mobile's
former Egyptian backer, take
aim at Canada's 'cultural
protectionism'
BY JULIUS MELNITZER
PHOTO:
REUTERS
in Reverse
