This article was last updated on April 16, 2022
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A renowned legal expert and a professor of international commercial law at McGill University in Montreal, Andrea Bjorklund, has alleged that the incoming Liberal government is taking a risk by promising to impose a moratorium on shale gas development. According to a promise by Premier-designate Brian Gallant, it was assured that the party would bring in a moratorium on hydraulic fracturing, i.e. also known as hydro-fracking, on Wednesday.
According to Bjorklund, the Liberals should remain cautious about how the moratorium will be instituted. Nova Scotia and Quebec have already brought in hydro-fracking bans, whereas a ban by the Quebec prompted U.S.-based Lone Pine Resources to sue the federal government for $250 million in compensation. According to the lawsuit filed by Lone Pine Resources, the Quebec government’s decision to revoke all of the company’s permits pertaining to shale gas development along the St. Lawrence River without compensation is illegal under the North American Free Trade Agreement and it considers the moratorium equal to expropriation.
Whereas on the other hand, a part of the U.S. State Department’s NAFTA arbitration team, Bjorklund, alleged that although the provinces have the right to change laws under NAFTA, they should also respect the rights of investors. She mentioned that “they are taking a small risk that they will be found to have violated international law.” Bjorklund stressed that “if a company has invested a great deal of money in reasonable reliance especially on particular representations by a government they are more likely able to recover.”
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