brought under the dominican republic - central america - ita

would qualify for treaty protections under CAFTA, thereby making CAFTA Article
10.12.2 redundant. The Respondent submits that this absurd result cannot be the correct
interpretation of the relevant treaty language in CAFTA under international law.
4.10. In regard to the Claimant‟s alleged investments made in El Salvador, the Respondent
refers to wire transfers coming not from the Claimant but from its Canadian parent
company (either Pacific Rim or its predecessor); Mr Shrake‟s confirmation to such
effect in a press release of 3 July 2008, as also explained by Mr Shrake during his
oral testimony [D2.488xx]; and the Claimant's slender reliance upon a fragmentary
page from an unconsolidated and apparently unaudited balance sheet purporting to
show the Claimant carrying an investment in El Salvador as an “asset”. As to the latter,
the Respondent submits that this entry proves nothing as to whether the Claimant
itself actually made that investment in the first place (as opposed to its Canadian
parent company); and that all it could show, at most, is that at some unidentified
time this asset was ostensibly placed on the Claimant‟s books. In any event, the Respondent
submits that this “thinly documented indication” of apparent ownership of
an asset located in El Salvador cannot constitute substantial business activities by the
Claimant in the USA for the purposes of CAFTA Article 10.12.2.
4.11. (ii) Ownership/Control: The Respondent contends that the Claimant was both
owned and controlled by persons of a non-CAFTA Party. As to the twin contrary arguments
advanced by the Claimant, the Respondent contends that neither can succeed
in defeating this straightforward conclusion under CAFTA, as a matter of treaty
interpretation and as a matter of undisputed or indisputable fact.
4.12. First, so the Respondent submits, the Claimant wrongly applies the plain language of
CAFTA to argue not the ownership of the Claimant, but the different ownership of
the Claimant's Canadian parent company (Pacific Rim); and second, the Claimant
wrongly asserts that because the majority of the shares in the Canadian parent are allegedly
held by persons with postal addresses in the USA, then it must follow that
the Canadian parent company is owned by persons of a CAFTA Party (namely the
USA) and thus the Claimant, as the Canadian parent‟s subsidiary, is indirectly also
owned by persons of that same CAFTA Party (the USA).
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