99–115 

111TH CONGRESS EXEC. REPT. " ! SENATE 2d Session 111–8 

INVESTMENT TREATY WITH RWANDA 

(TREATY DOC. 110–23) 

DECEMBER 22, 2010.—Ordered to be printed 

Mr. KERRY, from the Committee on Foreign Relations, 

submitted the following 

R E P O R T 

[To accompany Treaty Doc. 110–23] 

The Committee on Foreign Relations, to which was referred the 

Treaty Between the Government of the United States of America 

and the Government of the Republic of Rwanda Concerning the Encouragement and Reciprocal Protection of Investment, signed at 

Kigali on February 19, 2008 (the ‘‘Rwanda BIT’’ or the ‘‘Treaty’’) 

(Treaty Doc. 110–23), having considered the same, reports favorably thereon with one declaration, as indicated in the resolution of 

advice and consent, and recommends that the Senate give its advice and consent to ratification thereof. 

CONTENTS 

Page 

I. Purpose ........................................................................................................... 1 

II. Background .................................................................................................... 2 

III. Summary of Key Provisions .......................................................................... 2 

IV. Entry Into Force ............................................................................................ 9 

V. Committee Action .......................................................................................... 9 

VI. Committee Recommendations and Comments ............................................ 9 

VII. Text of Resolution of Advice and Consent to Ratification .......................... 13 

I. PURPOSE

Like other U.S. bilateral investment treaties (‘‘BITs’’), the Rwanda BIT is intended to provide protections for investors that underscore the shared commitment of the United States and Rwanda to 

open investment and trade policies. It contains the standard features of U.S. bilateral investment treaties: nondiscriminatory treatment; the free transfer of investment-related funds; prompt, adequate, and effective compensation in the event of an expropriation; 

a minimum standard of treatment in accordance with customary 

international law; freedom of investment from specified performance requirements; prohibitions on nationality-based restrictions 


smartinez on DSKB9S0YB1PROD with REPORTS
2 

for the hiring of senior managers; and transparency in governance. 

The Treaty also provides investors with the opportunity to resolve 

investment disputes with a host government through international 

arbitration, and it permits one party to the Treaty to bring an arbitration claim against the other party concerning the interpretation 

or application of the Treaty. And, it sets out an acknowledgement 

by the Parties that it is inappropriate to encourage investment by 

weakening or reducing the protection afforded in domestic environmental or labor laws. 

II. BACKGROUND

The United States and Rwanda announced their intent to negotiate a BIT on June 14, 2007. The BIT negotiations grew out of 

consultations between the two countries under the U.S.-Rwanda 

Trade and Investment Framework Agreement, signed in June 

2006. The proposed BIT is the 47th such treaty signed by the 

United States and the first between the United States and a subSaharan African country since 1998. Rwanda was considered a 

good candidate for a BIT negotiation, having opened its economy, 

improved its business climate, and embraced trade and investment 

as a means to boost economic development and help alleviate poverty. The Treaty, which was signed by the United States and 

Rwanda on February 19, 2008, is expected to reinforce the efforts 

of the Rwandan Government’s economic reform program. It was 

submitted to the Senate for advice and consent to ratification on 

November 20, 2008. 

The Rwanda BIT is the second BIT negotiated on the basis of the 

most recent U.S. model BIT, which was completed in 2004. It is 

largely consistent with the U.S. model, which is intended to encompass certain objectives from the Bipartisan Trade Promotion Authority Act of 2002 and contains similar provisions to the investment chapters of recently negotiated free trade agreements. 

III. SUMMARY OF KEY PROVISIONS

A detailed article-by-article discussion of the proposed BIT is attached to the Letter of transmittal from the Secretary of State to 

the President, which is reprinted in full in Treaty Document 110- 

23. A summary of the key provisions of the proposed BIT is set 

forth below. 

ARTICLE 1

Definitions 

The Treaty defines the term ‘‘investment’’ as ‘‘every asset that an 

investor owns or controls, directly or indirectly, that has the characteristics of an investment, including such characteristics as the 

commitment of capital or other resources, the expectation of gain 

or profit, or the assumption of risk.’’ The definition of investment 

provides an illustrative list of different types of investments. A 

‘‘covered investment’’ is defined, with respect to a party, as an ‘‘investment in its territory of an investor of the other party in existence as of the date of entry into force of this Treaty or established, 

acquired, or expanded thereafter.’’ 


smartinez on DSKB9S0YB1PROD with REPORTS
3 

ARTICLE 2

Scope and Coverage 

The proposed BIT applies to measures adopted or maintained by 

a party relating to: (a) investors of the other party, (b) covered investments, and (c) with respect to obligations involving performance requirements (Art. 8) and investment-related activities with 

environmental and labor implications (Arts. 12-13), all investment 

in the territory of a party. 

ARTICLE 3

National Treatment 

The Treaty protects investors of a party and their covered investments from discriminatory measures by the other party during the 

full life-cycle of an investment, including the establishment phase, 

when investors are attempting to make an investment. Under Article 3, a party must accord treatment to investors of the other party 

and covered investments no less favorable than that it accords, ‘‘in 

like circumstances,’’ to its own investors or investments in its territory. 

ARTICLE 4

Most Favored Nation Treatment 

Each party commits to provide to investors of the other party 

and to their covered investments treatment no less favorable than 

that which it provides in like circumstances to investors from any 

third country and their investments. These obligations apply with 

regard to the ‘‘establishment, acquisition, expansion, management, 

conduct, operation, and sale or other disposition of investments.’’ 

ARTICLE 5 AND ANNEX A

Minimum Standard of Treatment 

Article 5 establishes a minimum standard of treatment that each 

party owes to covered investments. Under that standard, the Parties are obligated to treat covered investments ‘‘in accordance with 

customary international law, including fair and equitable treatment and full protection and security.’’ Article 5 contains a number 

of other provisions further clarifying this obligation. 

‘‘Fair and equitable treatment’’ includes the obligation not to 

deny justice in criminal, civil, or administrative adjudicatory proceedings in accordance with the principle of due process embodied 

in the principal legal systems of the world. The obligation to provide ‘‘full protection and security’’ requires the host party to provide the level of police protection required under customary international law. The Article further requires that each party must accord to covered investments of the other party non-discriminatory 

treatment with respect to measures adopted in relation to losses 

suffered by investments due to armed conflict or civil strife. In the 

event that an investor suffers losses as a result of a party’s requisition or unnecessary destruction of its covered investment, restitution or compensation must be paid. Article 5 states that a breach 

of another provision of the proposed BIT or of a separate international agreement would not necessarily constitute a breach of 


smartinez on DSKB9S0YB1PROD with REPORTS
4 

this article. Finally, a footnote to Article 5 provides that the Article 

shall be interpreted in accordance with Annex A. 

Annex A 

Annex A contains the understanding of the Parties that ‘‘customary international law,’’ generally and as specifically referenced 

in Article 5 (and Annex B), ‘‘results from a general and consistent 

practice of States that they follow from a sense of legal obligation.’’ 

It further provides that, for purposes of Article 5, the ‘‘customary 

international law minimum standard of treatment of aliens refers 

to all customary international law principles that protect the economic rights and interests of aliens.’’ 

ARTICLE 6 AND ANNEX B

Expropriation and Compensation 

Article 6 incorporates into the Treaty the customary international law standard for expropriation. It prohibits either party 

from expropriating or nationalizing a covered investment unless 

such action is for a public purpose, is taken in a non-discriminatory 

manner, in accordance with due process of law and the minimum 

standard of treatment set out in Article 5(1) through (3), and is accompanied by prompt, adequate, and effective compensation. Compensation must be paid without delay and be equivalent to the fair 

market value of the expropriated investment immediately before 

the expropriation. Footnote 10 indicates that Article 6 shall be interpreted in accordance with Annexes A and B. 

Annex B 

Annex B clarifies the understanding of the Parties with respect 

to Article 6 and the determination of whether an expropriation has 

occurred. Annex B states that an action or series of actions by a 

party does not ‘‘constitute an expropriation unless it interferes with 

a tangible or intangible property right or property interest in an investment.’’ Annex B further explains that Article 6 addresses two 

types of expropriation: direct expropriation, involving formal transfer of title or outright seizure, and indirect expropriation, involving 

a case-by-case inquiry that considers the economic impact of the 

government action, its interference with investment-backed expectations, and its character. Finally, Annex B observes that, except 

in rare circumstances, non-discriminatory regulatory actions designed and applied to protect legitimate public welfare objectives do 

not constitute indirect expropriations. 

ARTICLE 7

Transfers 

Article 7 sets out the Treaty’s ‘‘free transfer’’ obligation. Under 

this provision, each party is required to ‘‘permit all transfers relating to a covered investment to be made freely and without delay 

into and out of its territory.’’ Notwithstanding this obligation, a 

party may prevent a transfer based on the ‘‘equitable, non-discriminatory, and good faith application’’ of certain laws, including those 

pertaining to bankruptcy, securities dealing, and criminal law. 


smartinez on DSKB9S0YB1PROD with REPORTS
5 

ARTICLE 8

Performance Requirements 

Article 8 prohibits the imposition by Parties of requirements relating to the performance of investments, including any requirement to achieve a given level or percentage of exports or domestic 

content or to transfer technology, production processes, or other 

proprietary knowledge to a person in its territory. The Article also 

prohibits Parties from offering advantages, such as a tax holiday, 

in exchange for a more limited set of performance requirements. 

The Parties agreed to two footnotes not present in the 2004 

Model. First, the Parties agreed to clarify that the enforcement of 

a commitment or undertaking to use a particular technology, a production process, or other proprietary knowledge is not, by itself, inconsistent with the performance requirement obligation relating to 

transfers of technology, a production process, or other proprietary 

knowledge. Second, the Parties agreed to clarify that nothing in Article 8(1) shall be construed to prevent a party from imposing or 

enforcing a requirement or enforcing a commitment or undertaking 

to train workers in its territory, provided that such training does 

not require the transfer of a particular technology, a production 

process, or other proprietary knowledge to a person in its territory. 

ARTICLE 9

Senior Management and Board of Directors 

The Treaty prohibits measures requiring that persons of any particular nationality be appointed to senior management positions in 

a covered investment. 

ARTICLES 10–11

Publications of Laws and Decisions Respecting Investment and 

Transparency in Lawmaking and Administrative Proceedings 

Article 10 requires each party to ensure that its laws, regulations, procedures, and administrative rulings of general application, and adjudicatory decisions respecting any matter covered by 

the Treaty are promptly published or otherwise made publicly 

available. 

Article 11 includes several provisions aimed at ensuring transparency. It requires that, to the extent possible, each party publish 

in advance laws, regulations, procedures, and administrative rulings of general application, and provide interested persons and the 

other party a reasonable opportunity to comment on such proposed 

measures. It further requires a party, upon the request of the other 

party, to provide information and respond to questions pertaining 

to any actual or proposed measure that the party requesting the 

information considers may materially affect the operation of the 

Treaty or its interests under the Treaty. Such information requests 

will be made through contact points that each party will designate. 

Finally, Article 11 includes detailed provisions concerning the character of administrative proceedings that impact covered investments or investors of the other party. 


smartinez on DSKB9S0YB1PROD with REPORTS
6 

ARTICLES 12–13

Investment in Environment and Labor 

In Articles 12 and 13, the Parties acknowledge that it would be 

inappropriate to encourage investment by weakening or reducing 

the protections afforded in domestic environmental and labor laws, 

respectively. This is a relatively new feature of the 2004 Model BIT 

that was also contained in the recent U.S.-Uruguay BIT. Both Articles also provide that a party may request consultations with the 

other party if it considers that the other party has offered such an 

encouragement. Article 12 provides that nothing in the Treaty shall 

be construed to prevent a party from adopting, maintaining, or enforcing any measure otherwise consistent with the Treaty that it 

considers appropriate to ensure that investment activity in its territory is conducted in a manner sensitive to environmental concerns. 

ARTICLE 14 AND ANNEXES I, II, III

Non-conforming Measures 

Article 14 establishes the framework for the Treaty’s Annexes of 

non-conforming measures (NCMs), which provide the extent to 

which existing and future domestic measures are, or may be exempt from, BIT obligations. The Article specifies that a party may 

list measures that do not conform to the following four obligations: 

National Treatment (Article 3), Most-Favored-Nation Treatment 

(Article 4), Performance Requirements (Article 8), and Senior Management and Boards of Directors (Article 9). In the Annexes, each 

party lists existing measures to which any or all of four key obligations of the Treaty do not apply, and sectors or activities in which 

each party reserves the right to adopt future measures to which 

any or all of those obligations will not apply. 

Annexes I, II, and III. 

Existing NCMs of both Parties are listed in Annexes I and III. 

Annex III is reserved for existing financial services NCMs, and 

Annex II contains a list of the sectors or activities in which the 

Parties reserve the right to adopt future NCMs. 

ARTICLE 16

Non-derogation 

Article 16 stipulates that the Treaty does not derogate from other 

obligations or laws of a party that entitle an investor to more favorable treatment than that accorded by the Treaty. 

ARTICLE 17

Denial of Benefits 

Article 17 establishes that a party may deny the benefits of the 

Treaty to an investor of the other party that is an enterprise of the 

other party, and to its investments, if persons of a third country 

own or control the enterprise, and the denying party either (1) does 

not maintain diplomatic relations with the third country; or (2) 

adopts or maintains measures, such as foreign policy sanctions, 

with respect to the third country or to a person of the third country 


smartinez on DSKB9S0YB1PROD with REPORTS
7 

that prohibit transactions with the enterprise or that would be violated or circumvented if the benefits of the Treaty were accorded 

to the enterprise or to its investments. A party may also deny the 

benefits of the Treaty to an investor of the other party that is an 

enterprise of such other party and to investments of that investor 

if the enterprise has no substantial business activities in the territory of the other party and persons of a non-party, or the denying 

party, own or control the enterprise. 

ARTICLE 18

Essential Security 

The Rwanda BIT contains a self-judging essential security exception. Article 18 states that nothing in the Treaty may be construed 

to preclude a party from applying measures that it considers necessary either to protect its own essential security interests or to 

fulfill its obligations with respect to the maintenance or restoration 

of international peace and security. The Treaty makes explicit the 

implicit understanding that measures to protect a party’s essential 

security interests are self-judging in nature, although each party 

would expect the provisions to be applied by the other in good 

faith. Article 18 also clarifies that nothing in the Treaty shall be 

construed to require a party to provide or allow access to any information the disclosure of which it determines to be contrary to its 

essential security interests. 

ARTICLE 20

Financial Services 

Article 20 includes two provisions that relate to the regulation of 

financial markets. Paragraph 1 specifies that the Treaty does not 

prohibit a party from adopting or maintaining measures relating to 

financial services for prudential reasons, including for the protection of depositors, investors, policy holders, or persons to whom a 

fiduciary duty is owed by a financial services supplier, or for the 

preservation of the integrity and stability of the financial system. 

Paragraph 2, the monetary and exchange rate policy exception, establishes that no provision of the Treaty applies to non-discriminatory measures of general application that may be taken by a party’s central bank or monetary authority pursuant to monetary and 

related credit policies or exchange rate policies. 

In the event that an investor-State claim is submitted to arbitration and the responding party invokes either of these provisions as 

a defense, specific provisions in Article 20 will apply to the dispute. 

If a party invokes one of the exceptions, it must within 120 days 

of the date the investor’s claim is submitted to arbitration submit 

to the competent financial authorities of both Parties a written request for a joint determination on the issue of whether and to what 

extent one of the exceptions is a valid defense to the investor’s 

claim. If the competent financial authorities agree that the defense 

is valid, the investor’s claim will be barred from arbitration. If the 

competent financial authorities fail to reach a determination by the 

end of the 120-day period, the tribunal will decide the issue. Article 

20 also contains provisions that apply to State-State disputes involving financial services. 


smartinez on DSKB9S0YB1PROD with REPORTS
8 

ARTICLES 23–27

Submitting Investor Claims to Arbitration 

Article 24 provides a mechanism for investors to submit to arbitration a claim that a party has breached an obligation under Articles 3 through 10 of the Treaty, an investment agreement, or an 

investment authorization. 

Article 27 provides for the establishment of three-member arbitral tribunals, with one member appointed by each disputing party 

and a presiding arbitrator appointed by agreement between them. 

If, within 75 days of the submission of a claim to arbitration, one 

of the disputing Parties has failed to appoint an arbitrator, or the 

two disputing Parties have failed to agree on a presiding arbitrator, 

arbitrators may be named by the ICSID Secretary-General. 

ARTICLES 28–33

Conduct of Investor-State Arbitration 

Article 28 provides that, unless otherwise agreed, arbitrations 

must take place in a country that is a party to the United Nations 

Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the New York Convention. This article 

authorizes a party that is not involved in a dispute to make oral 

or written submissions to the Tribunal on questions of interpretation of the Treaty. Article 28 also grants the tribunal the power to 

address preliminary questions of law and issue interim measures 

of protection to preserve the rights of a disputing party, as well as 

interim decisions and awards. Article 29 ensures that all substantive documents submitted to or issued by the tribunal shall be 

made public, with the exception of certain proprietary or confidential information. Article 30 sets out the governing law that the Tribunal must follow. 

ARTICLE 34

Awards 

Under Article 34, when an arbitral tribunal makes a final award 

against a responding party, it may award separately or in combination (1) monetary damages and any applicable interest, and (2) restitution of property, in which case the award must provide that the 

respondent may pay monetary damages and any applicable interest 

in lieu of restitution. Punitive damages are not permitted. A disputing party may seek enforcement of an award under the New 

York Convention or the Convention on the Settlement of Investment Disputes (ICSID Convention). If the respondent in an arbitration fails to comply with a final award, the other party to the arbitration may ask a State-State arbitral panel to determine whether 

the respondent’s failure to comply is inconsistent with the Treaty. 

ARTICLE 37

State-to-State Dispute Settlement 

Article 37 provides that any dispute between the Parties concerning the interpretation or application of the Treaty not resolved 

through consultations or other diplomatic channels shall be submitted on the request of either party to binding arbitration. Unless 


smartinez on DSKB9S0YB1PROD with REPORTS
9 

1 A transcript of the November 10, 2009 hearing is included as an appendix to Executive Report 111–3. 

the Parties otherwise agree, the arbitration shall be governed by 

UNCITRAL arbitration Rules. State-State arbitration cannot be established for matters arising under Articles 12 (Environment) and 

13 (Labor). 

IV. ENTRY INTO FORCE

The Treaty will enter into force thirty days after the date on 

which the Parties exchange instruments of ratification. The Treaty 

will remain in force for at least ten years and will continue in force 

thereafter unless one of the Parties terminates the Treaty. At the 

end of the ten year period, or any time thereafter, a party may terminate the Treaty by giving one year’s written notice to the other 

party. Upon termination, the Treaty will remain in force for an additional ten years with respect to covered investments that existed 

at the time of termination. 

V. COMMITTEE ACTION

The committee held a public hearing on the proposed BIT on November 10, 2009. The hearing was chaired by Senator Kaufman.1

The committee considered the Treaty on December 14, 2010, and 

ordered the Treaty favorably reported by voice vote, with a quorum 

present, with the recommendation that the Senate give advice and 

consent to its ratification, as set forth in this report and the accompanying resolution of advice and consent to ratification. Senator 

Feingold asked to be recorded as voting against the Treaty. 

VI. COMMITTEE RECOMMENDATIONS AND COMMENTS

The committee believes that the Rwanda BIT is in the interest 

of the United States and urges that the Senate act promptly to give 

advice and consent to ratification. 

A. HUMAN RIGHTS IN RWANDA

The Executive Branch chose to negotiate a BIT with Rwanda, in 

part, based on its strong economic reform program, which has 

helped to rebuild the Rwandan economy since the 1994 genocide. 

The Rwandan government has opened its economy, improved its 

business climate, and embraced trade and investment as a means 

to boost economic development and help alleviate poverty. As a result, the Rwandan economy has grown by over 9 percent per year 

since 1995. 

While Rwanda has served as an example of economic prosperity 

and stability and it has made genuine efforts to promote reconciliation after the horrific events of the 1990s, its human rights record 

remains more troubling. There are restraints on judicial independence and limits on freedoms of speech, press, association, and religion are widespread. In August, Rwanda’s incumbent president, 

Paul Kagame, was re-elected with 93 percent of the vote, leading 

to increased criticism concerning the state of democracy and overall 

lack of opposition in Rwanda politics. 

The committee takes such human rights concerns seriously and 

supports efforts to help foster democracy throughout the Great 


smartinez on DSKB9S0YB1PROD with REPORTS
10 

Lakes region, including Rwanda. Senator Kaufman raised this 

issue during the November 10, 2009 hearing on the Treaty. In response, Wesley Scholz, the Director of the Office of Investment Affairs in the Bureau of Economic, Energy, and Business Affairs at 

the Department of State testified: 

Rwanda’s made admirable advances over the last decade 

in economic development and making significant progress 

in adjudicating an enormous backlog of genocide cases. Despite these advances, Rwanda continues to face significant 

challenges regarding reconciliation, human rights, democratization, as it continues its efforts to rebuild a society 

torn asunder by war and genocide. The United States and 

the international community continue to work toward the 

goal of a stable, growing, democratic Rwanda with improved respect for human rights. Specifically, the U.S. 

works with the Government of Rwanda to open the political space, increase civil liberties, and to strengthen the judiciary. The treaty itself can promote economic development and employment in Rwanda, as well as improve the 

rule of law and transparency. These objectives are complementary to our efforts to work with the Rwandan government to improve human rights and democracy in 

Rwanda. We also continue to use other channels to raise 

our views on issues of human rights and democratization. 

These include our bilateral dialogues and other contacts 

and the Annual AGOA Country Review and the Department’s Annual Human Rights Report. 

The committee shares the administration’s view that the Treaty 

can improve the rule of law and transparency in Rwanda. At the 

same time, it urges the administration to ensure that promotion of 

human rights remains an essential aspect of our bilateral relationship with Rwanda. The committee looks forward to continued dialogue with the Executive Branch on this matter. 

B. DOMESTIC IMPLEMENTATION OF THE RWANDA BIT

Following the Supreme Court’s decision in Medellin v. Texas, 552 

U.S. 491 (2008), the committee has taken special care to reflect in 

its record of consideration of treaties its understanding of how each 

treaty will be implemented, including whether the treaty is selfexecuting. As noted in Executive Report 110–25, the committee believes it is of great importance that the United States complies 

with the treaty obligations it undertakes. In accordance with the 

Constitution, all treaties—whether self-executing or not—are the 

supreme law of the land, and the President shall take care that 

they be faithfully executed. In general, the committee does not recommend that the Senate give advice and consent to treaties unless 

it is satisfied that the United States will be able to implement 

them, either through implementing legislation, the exercise of relevant constitutional authorities, or through the direct application 

of the treaty itself in U.S. law. 

The resolution of advice and consent contains a statement reflecting the committee’s understanding of the extent to which this Treaty will be self-executing. This provides that Articles 3–10 of the 

Treaty are self-executing and do not confer private rights of action 


smartinez on DSKB9S0YB1PROD with REPORTS
11 

enforceable in United States courts. The remaining provisions of 

the Treaty are not self-executing and do not confer private rights 

of action enforceable in United States courts. 

Among the provisions of the treaty that are not self-executing are 

those related to two separate procedures for resolving disputes 

under the Treaty. 

The first of these procedures allows investors of one party to the 

Treaty to bring to binding arbitration claims that the government 

of the other party has breached specified provisions of the Treaty. 

In the event that such an arbitration resulted in an award against 

the United States, the legal authority exists to enforce the award. 

Such authorities include the Convention on the Recognition and 

Enforcement of Foreign Arbitral Awards (TIAS 6697) and related 

provisions of the Federal Arbitration Act (9 U.S.C. § 201 et seq.), as 

well as the Convention on the Settlement of Investment Disputes 

Between States and Nationals of Other States (TIAS 6090) and related provisions of the Convention on the Settlement of Investment 

Disputes Act of 1966 (22 U.S.C. § 1650a). 

The second of these procedures allows the two states parties to 

the Treaty (i.e. the United States and Rwanda) to submit disputes 

regarding the interpretation or application of the treaty to binding 

arbitration. No comparable treaty or statutory scheme governs the 

implementation in the United States of state-to state arbitration 

awards. In response to a question for the record on the authorities 

available to enforce such awards, Wesley Scholz, the Director of the 

State Department’s Office of Investment Affairs, provided the following answer: 

State-to-State arbitrations are extremely rare. In fact, no 

State-to-State arbitrations have taken place to date under 

U.S. bilateral investment treaties. Nevertheless, there are 

various tools at our disposal for implementing a State-toState award should the situation arise. 

Articles 3 through 10 of the BIT and other provisions 

that qualify or create exceptions to these Articles, such as 

Article 15, are self-executing but do not confer a private 

right of action. All remaining articles of the BIT are nonself-executing. As a result, should an arbitral decision conclude that U.S. state law is inconsistent with the BIT, the 

U.S. government could, if necessary, choose to initiate a 

legal action against the state to ensure compliance with a 

self-executing provision of the BIT. To the extent an arbitral decision determines that federal law is inconsistent 

with the BIT and an award addresses a self-executing provision of the BIT, then as long as the statute in question 

pre-dated the entry into force of the treaty, the later-intime self-executing BIT provision would prevail over the 

earlier inconsistent statute. 

To the extent an award addresses Article 11 of the BIT, 

which is a non-self-executing provision of the BIT establishing investment protections and subject to State-toState arbitration, the U.S. government could seek legislation where no other existing authority permitted it to comply with the award or take other appropriate steps, such 

as seeking to interpret the statute in a manner that is consistent with the arbitral decision. Under current U.S. law, 


smartinez on DSKB9S0YB1PROD with REPORTS
12 

however, existing federal authorities, for example, the Administrative Procedures Act, 5 U.S.C. § 551 et. seq., along 

with comparable state-level authorities, adequately ensure 

compliance with the transparency standards established in 

Article 11 of the BIT. 

Finally, were a State-to-State tribunal to award money 

damages against the United States, funds to satisfy such 

an award could be sought from appropriated funds, if any, 

or from the Judgment Fund (31 U.S.C. § 1304) to the extent appropriate. 

In brief, should a dispute between the parties lead to arbitration pursuant to the mechanism provided for in Article 37, there are a number of options available for implementing State-to-State arbitral decisions. 

Under the approach outlined by the administration, state-to-state 

arbitral awards against the United States will not be directly enforceable in U.S. courts by private parties. Rather, in most cases 

(i.e. those involving awards that interpret Articles 3–10 of the treaty), the executive branch will rely on the self-executing character 

of substantive provisions of the treaty to give effect to arbitral 

awards that interpret those provisions. This approach will require 

U.S. courts to give substantial weight to the interpretations of such 

treaty provisions rendered by arbitral tribunals in cases brought by 

the U.S. Government to give effect to such awards. U.S. courts 

have not invariably agreed with treaty interpretations rendered by 

international courts and tribunals in cases to which the United 

States has been a party (See, e.g., Sanchez-Llamas v. Oregon, 548 

U.S.C. 331 (2006)). However, in order to give effect to the shared 

intent of the Senate and the executive branch that the United 

States comply with its obligations in connection with the dispute 

settlement provisions of this Treaty and other bilateral investment 

treaties to which the United States is already a party, the committee expects that U.S. courts will not interpret the substantive 

provisions of bilateral investment treaties to preclude the United 

States giving effect to awards issued in state-to-state arbitrations 

to which the United States is a party if any other possible interpretation is available. (cf. Murray v. Charming Betsy, 6 U.S.C. (2 

Cranch) 64, 118 (1804) (‘‘an act of Congress ought never to be construed to violate the law of nations if any other possible construction remains.’’) 

There remains a category of disputes that could be referred to 

state-to-state arbitration involving provisions of the Treaty that are 

not self-executing. Such disputes could arise under Article 11 of the 

treaty, which addresses transparency measures to be taken by the 

two parties. Because Article 11 is not self-executing, the executive 

branch would be unable to rely on the authority of the Treaty itself 

as the basis for giving effect to an arbitral award related to that 

article. The executive branch has represented to the committee 

that existing federal and state laws regarding transparency measures governed by the treaty are fully adequate to satisfy U.S. obligations under the treaty, and that the possibility of an arbitral 

award against the United States relating to these provisions is accordingly extremely remote. In the event of such an adverse award, 

the executive branch has observed that it could seek legislation 


smartinez on DSKB9S0YB1PROD with REPORTS
13 

after the fact to provide the necessary authority to give effect to the 

award. 

The committee has reservations about the soundness of the proposed approach for this category of disputes. Waiting until an actual case arises and an award has been rendered against the 

United States to secure authority to comply with the award leaves 

matters on an uncertain footing. Complications posed by the Congressional calendar, competing legislative priorities, and political 

considerations specific to the case may make it difficult for the executive branch to seek or to secure such authority in a timely manner. In an analogous case—relating to the International Court of 

Justice’s judgment against the United States in the case of Avena 

and Other Mexican Nationals (Mexico v. United States of America) 

(I.C.J. Reports 2004, p. 12)—successive administrations have not 

formally proposed after the fact legislation to provide authority allowing the United States to comply with an adverse judgment. This 

has left the ability of the United States to meet its treaty obligations in a state of uncertainty, and caused concerns for our treaty 

partners, including our neighbor Mexico. The committee is concerned that failure to put the United States’ ability to implement 

awards relating to non-self-executing provisions of this treaty on 

sounder footing at the time of ratification of the treaty creates the 

risk of this unfortunate situation repeating itself. The committee’s 

concerns on this issue - which arise only with respect to a single, 

relatively narrow provision of this Treaty—do not lead it to decline 

to recommend ratification of the Treaty. However, the committee 

urges the executive branch to review its approach to ensuring compliance with adverse arbitral awards arising from non-self executing treaties (including as it relates to compliance with the ICJ 

judgment in the Avena case) and to identify effective means to facilitate U.S. compliance with its treaty obligations. 

VII. TEXT OF RESOLUTION OF ADVICE AND CONSENT TO

RATIFICATION

Resolved (two-thirds of the Senators present concurring therein), 

SECTION 1. SENATE ADVICE AND CONSENT SUBJECT TO A DECLARATION 

The Senate advises and consents to the ratification of the Treaty 

Between the Government of the United States of America and the 

Government of the Republic of Rwanda Concerning the Encouragement and Reciprocal Protection of Investment, signed at Kigali on 

February 19, 2008 (Treaty Doc. 110-23), subject to the declaration 

of section 2. 

SECTION 2. DECLARATION 

The advice and consent of the Senate under section 1 is subject 

to the following declaration: 

Articles 3 through 10 and other provisions that qualify or 

create exceptions to these Articles are self-executing. With the 

exception of these Articles, the Treaty is not self-executing. 

None of the provisions in this Treaty confers a private right of 

action. 

Æ 


smartinez on DSKB9S0YB1PROD with REPORTS