On May 18, the United States Trade Representative (USTR) gave official 90-day notice to Congress of the Trump administration’s intent to renegotiate NAFTA. The USTR also published a request for interested parties to submit public comments on matters relevant to “NAFTA Modernization” for the development of U.S. negotiating positions.

Although the official notice to Congress did not mention investor-state dispute settlement (ISDS), the USTR is expected to publish more detailed negotiating objectives in mid-July (at least 30 days before August 16, 2017, when the 90-day consultation period ends).

Furthermore, the USTR invitation for public comments included “investment issues” as part of the relevant matters to be addressed. Earlier this year, before any formal step was taken in the NAFTA renegotiation process, information was leaked to the press that the administration’s intention to renegotiate NAFTA included proposed changes to the dispute resolution provisions of the Investment Chapter. Therefore, it remains uncertain whether the renegotiation of NAFTA will have impact on ISDS.

The legal consequences of revising or repealing NAFTA would be significant for investors. In particular, if the United States withdraws from NAFTA, U.S. investors would no longer be able to pursue international arbitration against Mexico and Canada for expropriation of their investments, or for protection against arbitrary and discriminatory measures impacting the value of such investments.