Windstream Energy files enforcement application with the Ontario Superior Court after Canada defaults on NAFTA award payment
For the first time in the history of the North American Free Trade Agreement (NAFTA), the Government of Canada has failed to comply with the terms of payment following an award ruling by an arbitral tribunal appointed under NAFTA. As a result, Windstream Energy LLC (Windstream) today filed an enforcement application with the Ontario Superior Court.
In its application to the Ontario Superior Court, Windstream requested an order recognizing and enforcing the award issued by an arbitral tribunal under Chapter 11 of NAFTA in accordance with the UNCITRAL Arbitration Rules. The Tribunal’s award, which was rendered on September 30, 2016, required Canada to pay to Windstream CAD $28,095,332.00 within 30 days of the award. The award began to bear interest at a rate of 2.7 percent, compounded annually, from November 1, 2016 to the date of payment.
Windstream’s most recent action comes after years of ongoing challenges with the Canadian and Ontario governments regarding their mismanagement of Windstream’s $5.2 billion Feed-In Tariff contract for a 300 MW offshore wind project near Kingston, Ontario.
As of December 22, 2016, the Ontario government has accepted the ruling of the arbitral tribunal under NAFTA.
“The Canadian government’s failure to pay the award granted to Windstream by the NAFTA tribunal is unprecedented,” said David Mars, Director of Windstream Energy LLC. “Throughout the process, we have negotiated in good faith in order to reach a fair and reasonable solution, but it has become apparent that the Canadian government has shown complete disregard for its NAFTA obligations.”
“The NAFTA tribunal was clear: Windstream was treated unfairly and inequitably and our Feed-In-Tariff contract is still in force. The $28 million award to Windstream was handed down nearly five months ago. From Windstream’s perspective, this investor-settlement dispute under NAFTA raises serious concerns if the Canadian government cannot fulfill its NAFTA treaty obligations to American companies. As interest continues to accrue, we hope that Canada abides and complies with the NAFTA award without further delay.”