2. Arbitrators shall:
(a) have expertise or experience in public international law, international trade or international investment rules, or the settlement of disputes arising under international trade or international investment agreements;
(b) be independent of, and not be affiliated with or take instructions from, either Party or the disputing investor; and
(c) comply with the Code of Conduct for Dispute Settlement established by the Commission.
3. If the disputing parties do not agree on the remuneration of the arbitrators before the Tribunal is constituted, the prevailing ICSID rate for arbitrators applies.
4. The Commission may establish rules relating to the expenses incurred by the Tribunal.
Article 10.27. Constitution of a Tribunal When a Party Fails to Appoint an Arbitrator or the Disputing Parties Are Unable to Agree on a Presiding Arbitrator
1. The Secretary-General shall serve as appointing authority for an arbitration under this Section.
2. If a Tribunal, other than a Tribunal established under Article 10.29, is not constituted within 90 days from the date that a claim is submitted to arbitration, the Secretary-General, at the request of either disputing party, shall appoint the arbitrator or arbitrators not yet appointed. The presiding arbitrator shall not be a national of either Party.
Article 10.28. Decision to Appoint Arbitrators
For the purposes of Article 39 of the ICSID Convention and Article 7 of Schedule C to the ICSID Additional Facility Rules, and without prejudice to an objection to an arbitrator based on a ground other than citizenship or permanent residence:
(a) the disputing Party consents to the appointment of each individual member of a Tribunal established under the ICSID Convention or the ICSID Additional Facility Rules;
(b) a disputing investor referred to in Article 10.19 may submit a claim to arbitration, or continue a claim, under the ICSID Convention or the ICSID Additional Facility Rules, only if the disputing investor consents in writing to the appointment of each individual member of the Tribunal; and
(c) a disputing investor referred to in Article 10.20(1) may submit a claim to arbitration, or continue a claim, under the ICSID Convention or the ICSID Additional Facility Rules, only if the disputing investor and the enterprise consent in writing to the appointment of each individual member of the Tribunal.
Article 10.29. Consolidation
The consolidation of claims shall be governed by the rules set out in Annex 10.29.
Article 10.30. Notice to the Non-Disputing Party
A disputing Party shall deliver to the non-disputing Party a copy of the notice under Article 10.21 and other documents, within 30 days of the date that those documents are delivered to the disputing Party.
Article 10.31. Participation of the Non-Disputing Party
1. The non-disputing Party may make submissions to a Tribunal on a question of interpretation of this Agreement, if it gives notice in writing to the disputing parties.
2. The non-disputing Party has the right to attend a hearing held under this Section, whether or not it makes submissions to the Tribunal.
Article 10.32. Documents
1. The non-disputing Party is entitled, at its cost, to receive from the disputing Party, a copy of:
(a) the evidence that has been tendered to the Tribunal;
(b) the written argument of the disputing parties; and
(c) all pleadings filed in the arbitration.
2. The non-disputing Party receiving information pursuant to paragraph 1 shall treat the information as if it were a disputing Party.
Article 10.33. Place of Arbitration
Unless the disputing parties decide otherwise, a Tribunal shall hold an arbitration in the territory of a Party that is a party to the New York Convention, selected in accordance with:
(a) the ICSID Additional Facility Rules, if the arbitration is under those Rules or the ICSID Convention; or
(b) the UNCITRAL Arbitration Rules, if the arbitration is under those Rules.
Article 10.34. Preliminary Objections to Jurisdiction or Admissibility
1. The Tribunal shall have the power to rule on issues of jurisdiction and admissibility.
2. If those issues are raised as preliminary objections, the Tribunal shall, whenever possible, decide the matter before proceeding to the merits.
Article 10.35. Public Access to Hearings and Documents
1. Hearings held under this Section shall be open to the public. The Tribunal may hold portions of the hearings in camera to the extent necessary to protect confidential information, including business confidential information.
2. The Tribunal shall, in consultation with the disputing parties, establish procedures to protect confidential information and make logistical arrangements for open hearings.
3. The Tribunal or the disputing Party shall make publicly available all documents submitted to, or issued by, the Tribunal, unless the disputing parties decide otherwise, subject to the redaction of confidential information.
4. Notwithstanding paragraph 3, the Tribunal or the disputing party shall make publicly available a Tribunal award under this Section, subject to the redaction of confidential information.
5. A disputing party may disclose to other persons in connection with the arbitral proceedings any unredacted documents that it considers necessary to prepare its case, but it shall ensure that those persons protect the confidential information in those documents.
6. The Parties may share relevant unredacted documents with officials of their respective national and sub-national governments in the course of dispute settlement under this Chapter, but they shall ensure that those persons protect any confidential information in those documents.
7. As provided under Article 22.3 (Exceptions - National Security) and Article 22.6 (Exceptions - Disclosure of Information), the Tribunal may not require a Party to furnish or allow access to information which, if disclosed, would impede law enforcement or would be contrary to the Partyâs domestic law protecting the deliberative and policy- making processes of the executive branch of government at the cabinet level, personal ptivacy or the financial affairs and accounts of individual customers of financial institutions, or which it determines to be contrary to its essential security.
8. If a Tribunal's confidentiality order designates information as confidential and a Party's domestic law on access to information requires public access to that information, the Party's domestic law on access to information prevails. However, a Party should endeavour to apply its domestic law on access to information to protect information that is designated confidential by the Tribunal.
Article 10.36. Submission by a Non-Disputing Party
1. Any person or entity of a Party, or a person with a significant presence in the territory of a Party, that wishes to file a written submission with the Tribunal (the "applicant") may apply for leave from the Tribunal to file a non-disputing party submission, in accordance with Annex 10.36. The applicant shall attach the submission to the application.
2. The applicant shall provide the application for leave to file a non-disputing party submission and the submission to all disputing parties and the Tribunal.
3. The Tribunal shall set an appropriate date for the disputing parties to comment on the application for leave to file a non-disputing party submission.
4. In determining whether to grant leave to file a non-disputing party submission, the Tribunal shall consider, among other things, the extent to which:
(a) the non-disputing party submission would assist the Tribunal in the determination of a factual or legal issue related to the arbitration by bringing a perspective, particular knowledge or insight that is different from that of the disputing parties;
(b) the non-disputing party submission would address a matter within the scope of the dispute;
(c) the non-disputing party has a significant interest in the arbitration; and
(d) there is a public interest in the subject-matter of the arbitration.
5. The Tribunal shall ensure that:
(a) a non-disputing party submission does not disrupt the proceedings; and
(b) the submission does not unduly burden or unfairly prejudice either disputing party.
6. The Tribunal shall decide whether to grant leave to file a non-disputing party submission. If leave to file a non-disputing party submission is granted, the Tribunal shall set an appropriate date for the disputing parties to respond in writing to the non-disputing party submission. By that date, the non-disputing Party may, pursuant to Article 10.31, address any issues raised in the non-disputing party submission regarding the interpretation of this Chapter.
7. The Tribunal that grants leave to file a non-disputing party submission is not required to address the submission at any point in the arbitration, and the non-disputing party that files the submission is not entitled to make further submissions in the arbitration.
8. The provisions pertaining to public access to hearings and documents under Article 10.35 govern access to hearings and documents by non-disputing parties that file applications under this Article.
Article 10.37. Governing Law
1. A Tribunal established under this Section shall decide the issues in dispute in accordance with this Agreement and applicable rules of international law.
2. Subject to the other terms of this Section, a Tribunal shall apply the following when a claim is submitted to arbitration for a breach of a legal stability agreement referred to in Articles 10.19(2) or 10.20(2):
(a) the rules of law specified in the legal stability agreement, or as the disputing parties may otherwise decide; or
(b) if the rules of law have not been specified or otherwise decided:
(i) the law that a domestic court or tribunal of proper jurisdiction of the disputing Party would apply in the same case, including its rules on the conflict of laws, and
(ii) the rules of international law that may apply.
3. The Commission’s interpretation of a provision of this Agreement shall be binding on a Tribunal established under this Section and an award under this Section shall be consistent with that interpretation.
Article 10.38. Interpretation of Annexes
1. If a disputing Party asserts as a defense that the measure alleged to be a breach is within the scope of a reservation or exception set out in Annex I or Annex I, the Tribunal shall, at the request of that disputing Party, request the Commission to interpret the issue. Within 60 days of delivery of the request, the Commission shall submit in writing its interpretation to the Tribunal.
2. Further to Article 10.37(2), an interpretation of the Commission submitted under patagraph 1 shall be binding on the Tribunal. If the Commission fails to submit an interpretation within 60 days, the Tribunal shall decide the issue.
Article 10.39. Expert Reports
1. Subject to paragraph 2, a Tribunal may appoint one or more experts to report to it in writing on any factual issue concerning environmental, health, safety or other scientific matters raised by a disputing party, subject to such terms and conditions as the disputing parties may decide.
2. The Tribunal may not exercise the power conferred to it under paragraph 1 if the disputing parties decide the Tribunal may not do so.
3. Paragraph 1 does not affect the appointment of other kinds of experts where the appointment is authorized by the applicable arbitration rules.
Article 10.40. Interim Measures of Protection
A Tribunal may order an interim measure of protection to preserve the rights of a disputing party or to ensure that the Tribunal's jurisdiction is made fully effective. This interim measure may include an order to preserve evidence in the possession or control of a disputing party or to protect the Tribunal's jurisdiction. A Tribunal may not order attachment or enjoin the application of the measure alleged to constitute a breach referred to in Article 10.19 or 10.20. For the purposes of this paragraph, an order includes a tecommendation.
Article 10.41. Final Award
1. If a Tribunal makes a final award against a disputing Party, the Tribunal may award, separately or in combination, only:
(a) monetary damages and any applicable interest; or
(b) the restitution of property, in which case the award shall provide that the disputing Party may pay monetary damages and any applicable interest in lieu of restitution.
The Tribunal may also award costs in accordance with the applicable arbitration rules.
2. Subject to paragraph 1, if a claim is made under Article 10.20(1):
(a) an award of monetary damages and any applicable interest shall state that the monetary damages and interest are payable to the enterprise;
(b) an award of restitution of property shall provide that restitution be made to the enterprise; and
(c) the award shall provide that it is made without prejudice to a right that a person may have in monetary damages or property awarded under subparagraphs (a) or (b) under domestic law.
3. A Tribunal may not order a Party to pay punitive damages.
Article 10.42. Finality and Enforcement of an Award
1. An award made by a Tribunal does not have binding force except between the disputing parties and in respect of that particular case.
2. A disputing party shall abide by and comply with an award without delay, subject to paragraph 3, and the applicable review procedure for an interim award.
3. A disputing party may not seek enforcement of a final award until:
(a) in the case of a final award made under the ICSID Convention:
(i) 120 days have elapsed from the date the award is rendered, provided that a disputing party does not request the revision or annulment of the award, or
(ii) revision or annulment proceedings have been completed; and
(b) in the case of a final award under the ICSID Additional Facility Rules or the UNCITRAL Arbitration Rules:
(i) 90 days have elapsed from the date the award is rendered, and a disputing party has not commenced a proceeding to revise, set aside or annul the award, or
(ii) a court dismisses or allows an application to revise, set aside or annul the award and there is no further appeal.
4. Each Party shall provide for the enforcement of an award in its territory.
5. If a disputing Party fails to abide by or comply with a final award, the Commission, on delivery of a request by a Party whose investor was a party to the arbitration, shall establish a panel under Chapter Twenty-One (Institutional Arrangements and Dispute Settlement Procedures). The requesting Party may seek the following in these proceedings:
(a) a determination that the failure to abide by or comply with the final award is inconsistent with the obligations of this Agreement; and
(b) a recommendation that the Party abide by or comply with the final award.
6. A disputing investor may seek to enforce an arbitration award under the ICSID Convention, the New York Convention or the Inter-American Convention, regardless of whether proceedings are taken under paragraph 5.
7. A claim that is submitted to arbitration under this Section is considered to arise out of a commercial relationship or transaction for the purposes of Article I of the New York Convention and Article 1 of the Inter-American Convention.
Article 10.43. General
Time When a Claim Is Submitted to Arbitration
1. A claim is submitted to arbitration under this Section when:
(a) the request for arbitration under Article 36(1) of the ICSID Convention is received by the Secretary-General;
(b) the notice of arbitration under Article 2 of Schedule C of the ICSID Additional Facility Rules is received by the Secretary-General; or
(c) the notice of arbitration given under the UNCITRAL Arbitration Rules is received by the disputing Party.
Service of Documents
2. Notices and other documents shall be delivered to a Party at the place named for that Party below:
For Canada:
Office of the Deputy Attorney General of Canada
Justice Building
284 Wellington Street
Ottawa, Ontario K1A 0H8
Canada
For Honduras:
Dirección General de Integración Económica y Política Comercial
Secretaría de Estado en los Despachos de Industria y Comercio
Edificio San José
Boulevard José Cecilio del Valle
Tegucigalpa, Honduras
Receipts under Insurance or Guarantee Contracts
3. In an arbitration under this Section, a disputing Party may not assert, as a defence, counterclaim, right of setoff, or otherwise that the disputing investor has received or will receive, under an insurance or guarantee contract, indemnification or other compensation for all or part of its alleged damages.
Annex 10.11. Indirect Expropriation
The Parties confirm their shared understanding that:
(a) indirect expropriation results from a Party’s a measure or series of measures that has an effect equivalent to direct expropriation without formal transfer of title or outright seizure;
(b) the determination of whether a measure or series of measures by a Party constitutes an indirect expropriation requires a case-by-case, fact-based inquiry that considers, among other factors:
(i) the economic impact of a measure or a series of measures, although the sole fact that a measure or series of measures by a Party has an adverse effect on the economic value of an investment does not establish that an indirect expropriation has occurred,
(ii) the extent to which the measure or series of measures interferes with distinct, reasonable, investment-backed expectations, and
(iii) the character of the measure or series of measures; and
(c) except in rare circumstances, such as when a measure or series of measures is so severe in light of its purpose that it cannot be reasonably viewed to have been adopted and applied in good faith, a non-discriminatory measure of a Party that is designed and applied to protect legitimate public welfare objectives, such as health, safety and the environment, does not constitute an indirect expropriation.
Annex 10.23. Submission of a Claim to Arbitration
1. An investor of Canada may not submit to arbitration under Section C a claim that Honduras has breached an obligation under Section B:
(a) on the investor’s own behalf under subparagraphs 1(a) or (b) of Article 10.19; or
(b) on behalf of an enterprise of Honduras that the investor owns or controls, directly or indirectly, under subparagraphs 1(a) or (b) of Article 10.20,
if the investor or the enterprise, respectively, has alleged that breach in proceedings before a court or administrative tribunal of Honduras.
2. An investor of Canada may not submit to arbitration under Section C a claim that Honduras has breached a legal stability agreement referred to in paragraph 3 of Article 10.19 or paragraph 3 of Article 10.20:
(a) on the investor’s own behalf under subparagraph 1(c) of Article 10.20; or
(b) on behalf of an enterprise of Honduras that the investor owns or controls directly or indirectly under subparagraph 1(c) of Article 10.20,
if the investor or the enterprise, respectively, has alleged that breach in proceedings before a court or administrative tribunal of Honduras or has submitted that claim to any other binding dispute settlement proceedings.
3. For greater certainty, if an investor of Canada elects to submit:
(a) a claim described in paragraph 1 to a court or administrative tribunal of the Honduras; or
(b) a claim described in paragraph 2 to a court or administrative tribunal of Honduras or to any other binding dispute settlement proceedings,
that election is definitive and the investor may not then submit the same claim to arbitration under Section C.
Annex 10.24. Standard Waiver and Consent in Accordance with Article 10.24
1. In the interest of facilitating the filing of a waiver as required by Article 10.24, and to facilitate the orderly conduct of the dispute settlement procedures set out in Section C, the following standard waiver forms shall be used, depending on the type of claim.
2. Claims filed under Article 10.19 must be accompanied by Form 1, if the investor is a national of a Party, or Form 2, if the investor is a Party, a state enterprise of a Party, or an enterprise of that Party.
3. If the claim is based on loss or damage to an interest in an enterprise of the other Party that the investor owns or controls, directly or indirectly, Form 1 or 2 must be accompanied by Form 3.
4. Claims made under Article 10.20 must be accompanied by Form 4 and:
(a) Form 1, if the investor is a national of a Party; or