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)

América Latina Mejor sin TLC | 30-Jun-2023
Organizaciones de todo el mundo convocan a adherir a una declaración en solidaridad con el país centroamericano. Denuncian que una transnacional norteamericana demandó al país por tomar la decisión soberana de recuperar el control de su territorio. La demanda alcanza los 11 mil millones de dólares, dos tercios del presupuesto nacional.
Public Citizen | 30-Jun-2023
We stand in solidarity with the people of Honduras and condemn US company Próspera’s $11 billion case against the will of the people.
La Tribuna | 13-Jun-2023
Honduras rechaza al árbitro aceptado por el Centro Internacional de Arreglo de Diferencias Relativas a Inversiones (Ciadi) en el litigio “ilegal” de la ZEDE Próspera, luego de enviar ayer una notificación oficial a este organismo asentado en Washington, Estados Unidos.
Prensa Latina | 2-Jun-2023
Honduras aboga hoy por defender su soberanía e integridad territorial y autodeterminación con los instrumentos del derecho nacional e internacional, informaron autoridades.
Prensa Latina | 2-Jun-2023
This is related to the complaint made the day before by government functionaries on the absence of legality in the litigation that the ICSID opened on the case of the Employment and Economic Development Zone (ZEDE) against the Government.
CIAR Global | 31-May-2023
Un grupo de 33 senadores y congresistas estadounidenses han enviado una carta a la Administración Biden pidiendo que mantenga su compromiso y se abstenga de negociar nuevos acuerdos comerciales que incluyan el arbitraje de inversiones.
El Libertador | 5-May-2023
Un grupo de 33 congresistas estadounidenses, ha solicitado al secretario de Estado de EE.UU., Antony Blinken y la representante de Comercio, Katherin Tai, que se apoye la defensa de Honduras ante la abusiva demanda interpuesta por la ilegal ZEDE Próspera, propiedad de Erick A. Brimen, que busca cobrar a los hondureños 11,000 millones de dólares.
Reuters | 4-May-2023
Democratic U.S. lawmakers on Wednesday urged the U.S. Trade Representative and State Department to eliminate investor-state dispute settlement provisions from current and future trade deals
Prospera | 6-Apr-2023
US investors Honduras Próspera Inc. and its affiliates filed claims with the International Centre for Settlement of Investment Disputes against the State of Honduras.
CIAR Global | 6-Mar-2023
Un tribunal del Centro Internacional de Arreglo de Diferencias relativas a Inversiones (CIADI) ha rechazado la demanda de la familia Lopez-Goyne y otros contra Nicaragua por la rescisión de un contrato de concesión de hidrocarburos.