The tribunal in the NAFTA-based arbitration of Odyssey Marine Exploration, Inc. v. United Mexican States has declared inadmissible the amicus curiae brief submitted by the Centre for International Environmental Law (CIEL) in collaboration with Sociedad Cooperativa de Producción Pesquera Puerto Chale (Cooperativa). The co-filers of the brief had initially petitioned the tribunal to take into account their views on the environmental impact of the Don Diego seabed mining project off Mexico’s Baja California Peninsula.
In its 2-to-1 majority decision, the tribunal held that the relevant criteria for the admissibility of an amicus curiae were those found in the Statement of the Free Trade Commission on non-disputing party participation: (1) The non-disputing parties must have a significant interest in the arbitration, and (2) they must provide a unique perspective on a factual or legal issue that differs from the perspectives of the disputing parties and that assists the arbitral tribunal in making a decision. It went on to find that the co-filers met neither of these two criteria.
In his dissenting opinion, arbitrator Philippe Sands disagreed with the majority decision. He criticized the tribunal for failing to consider the intention of the NAFTA parties, which had specifically recognized the potential of amicus curiae briefs to “improve both the quality and the legitimacy of the final award.” According to Sands, arbitrators were under an obligation to consider “(a) general legitimacy concerns in relation to investment treaty arbitration, and (b) specific local community interests that are engaged by a particular case.” In the Odyssey v. Mexico case, he considered that they had failed to do so by construing the significant interest requirement narrowly and by failing to see the unique and relevant perspectives that CIEL and the Cooperative could have brought to the dispute.
Besides its relevance to the admissibility of amicus curiae briefs, the dissent is also significant as it recognizes the risk of regulatory chill. In that regard, Sands took the view that it was now “well-recognized that investment treaty arbitration can have a significant impact on domestic regulatory regimes, even where compensation is the only remedy awarded.”