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CAFTA

The US-Dominican Republic–Central America Free Trade Agreement (CAFTA-DR or CAFTA for short) was signed in 2004. It encompasses the United States and the Central American countries of Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic.

The investor-state dispute settlement (ISDS) mechanism specified in CAFTA has provided US companies privileged means to challenge national laws and claim millions of US dollars in compensation in Central America.

As of end of 2019, CAFTA was invoked in 11 cases.

The most well-known cases include:

• TCW (US) vs. The Dominican Republic: case settled in 2009 for US$26.5 million to the investor, an investment management corporation.

• Railroad Development Corporation (US) vs. Guatemala: US$18.6 million awarded in 2012 to the investor in a dispute over a railroad contract.

• Pac Rim Cayman LLC (US) vs. El Salvador: In 2008, El Salvador denied a mining permit to Pac Rim (now OceanaGold) due to environmental concerns, and notably the impact on water resources. In 2012, the arbitral tribunal dismissed jurisdiction over the CAFTA claims but assumed jurisdiction of the claims under the domestic investment law. In October 2016, the tribunal decided that the company’s case was without merit.

Photo: Danny Hammontree / CC BY-NC-ND 2.0

(March 2020)

Notice of intent to submit claims to arbitration pursuant to article 10.16 of the CAFTA-DR
Prospera | 10-Nov-2022
In accordance with the Dominican Republic–Central America–United States Free Trade Agreement, Honduras Próspera Inc. and its affiliates submit to the Republic of Honduras this written notice of their intention to submit claims to arbitration.
CAFTA , Honduras , investor-state disputes | ISDS , US
ZEDE Próspera prepara millonaria demanda contra Honduras
Proceso Digital | 4-Nov-2022
"En septiembre recibimos notificación de la nota que entregó ZEDE. El tema es que a más tardar el 16 de diciembre tienen que meter solicitud e iniciar el arbitraje", el ministro de la Secretaría de Desarrollo Económico dijo.
CAFTA , geopolitics , Honduras , investor-state disputes | ISDS , US
US pressuring new left-wing Honduras government over privatized cities
The Real News Network | 3-Nov-2022
US senators argue that abolishing special economic zones known as ZEDEs would violate the provisions of CAFTA-DR, including the provision ensuring “fair and equitable treatment and full protection and security.”
aid , CAFTA , geopolitics , Honduras , investor-state disputes | ISDS , US
KCA, a Reno Nevada based mining company, suspended gold mine in Guatemala
Sierra Nevada Ally | 28-Jul-2022
However, locals feel latent tension that the imminent consultation process or the arbitration suit could revive earlier threats, violence, and legal persecution from company employees and contractors.
actions | resistance , CAFTA , environment , Guatemala , investor-state disputes | ISDS , mining
Cementera estadounidense presenta arbitraje contra República Dominicana
CIAR Global | 18-May-2022
La cementera estadounidense Sargeant Petroleum ha presentado un arbitraje de inversiones contra República Dominicana por un contrato de concesión de materiales asfálticos.
CAFTA , Dominican Republic , investor-state disputes | ISDS , US
Miners face headwinds in Guatemala despite consultation push
bnamericas | 18-May-2022
Mining companies are continuing to face political and community headwinds in Guatemala, as authorities push on with consultations needed to lift suspensions that have crippled the industry in recent years.
actions | resistance , CAFTA , environment , Guatemala , indigenous peoples , investor-state disputes | ISDS , mining
Honduran government repeals ZEDEs law amid warnings of free trade agreement rights and arbitration
Peace Brigades International Canada | 2-May-2022
The ZEDEs are free from import and export taxes, but could set up their own internal forms of government, as well as courts, security forces, schools and even social security systems.
actions | resistance , CAFTA , Honduras , investor-state disputes | ISDS , land , sovereignty | democracy
Guatemalan water defenders celebrate 10 years of resistance
Inequality.org | 3-Mar-2022
An attempted assassination, criminalization, and violent eviction in 2014 didn’t stop the Peaceful Resistance of La Puya in Guatemala, which won legal action suspending harmful mining activities.
actions | resistance , CAFTA , environment , Guatemala , investor-state disputes | ISDS , mining , water
Corporate power and abuse is a root cause of migration
People’s World | 29-Jun-2021
To seriously address the roots and causes of migration, it is urgent to dismantle the neoliberal rules which grant excessive privileges to transnational corporations.
CAFTA , Central America , human rights , investor-state disputes | ISDS , US
A new environmentalist playbook
The American Prospect | 24-Mar-2021
An improbable victory in El Salvador offers lessons for grassroots activists worldwide.
actions | resistance , CAFTA , El Salvador , investor-state disputes | ISDS , mining , water