Participants at the FTAA workshop fully supported the consensus on Investments reached in Toronto and suggested continuing said work based on the aforementioned guidelines.

Participants agreed that the goal of the Investment Chapter of the FTAA is to increase trade and investments for which high standards of treatment are necessary, in compliance with bilateral treaties in force, to gain the confidence of investors.

Similarly, a recommendation was made to lake into account the relationship of the issues discussed by this Chapter with the issues related to competition policies, government procurement and services.

A recommendation was made to inform about the conclusions and recommendations of the Hemispheric Business Forum.

There are two basic positions. One position is that all assets of the investor should be covered. A second view would be more restrictive, Limiting coverage to direct foreign investments (shares, etc.). An analysis of whether portfolio investments should be included.

The nationality of the investing company (including corporations with shareholders equity) and individual investors (dual nationality and adoption of other nationality) should be determined.

Retroactive enforcement of the agreement was recommended to protect investments made prior to the agreement, excluding disputes originated before the agreement became effective, particularly those resulting from prior contractual relationships.

Full coverage, both at a national and subnational level, of the agreement was recommended, in compliance with the Constitutions of each Member country

2. TREATMENT

As a general rule, investors must receive the highest standard establishing the national or most-favored-nation treatment.

An analysis is recommended to determine whether pre-establishment will be granted and, if granted, the type of lists (negative or positive) to define reservations or exceptions.

A common and clear methodology should be established to work on the exceptions and reservations.

Special treatment must be granted to small economies, in agreement with the conclusions of the Workshop on Small Economies.

A definition of the treatment for existing bilateral investment treaties in the hemisphere and existing integration agreements that include chapters on Investment, was recommended.

An analysis of the exceptions granted to transfers as a result of the balance of payment crisis is recommended provided said crisis is defined in agreement with objective criteria, specifying reasons and the term of application of the measure. This would imply a deferral in payment but no impairment of rights.

It should be noted that no reference was made to labor issues, but rather to business facilitation. Free transit of key staff, facilitation of entrance and temporary residence, as well as the issuance of business visas should be guaranteed.

There are three positions: one suggests prohibiting every kind of performance requirements; another one accepts them as an exception and subject to specific regulations. And the third group considers these measures to be active policy instruments to support their development strategies and, thus, they should be permanent part of the agreement.

The definition should be extended to "all types of expropriations".

The consensus is that national treatment should be awarded. There are two positions. One considers that this issue should be dealt with separately. The other position holds that this issue should be dealt with under the national treatment provision.

A dispute settlement mechanism should be included in the FTAA in order to regulate and demand compliance with the agreements included in the investment chapter assuring that both the States and the investors comply with their commitments.

Consensus was reached as to the importance of this subject and a special workshop should be set up to discuss this issue since it encompasses many different areas. Also, it was recommended that all the member countries of the FTAA subscribe and ratify the Inter-American Convention against Corruption held in Caracas on March 29,1996.

The labor and environmental standards should not be addressed as part of the investment chapter.

The Andean Development Corporation is invited to participate in the FTAA in the same way and manner the IDB is so doing.