Newsbrief: Canadian NAFTA Suit Over Hemp Restrictions Enters Arbitration 8/9/02

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Kenex, Ltd., the Canadian hemp exporter that sued the US under NAFTA over the DEA's effort to ban hemp seed foods, filed its NAFTA Notice of Arbitration with the US State Department August 2. Kenex is seeking at least $20 million in compensation from the US government for losses suffered because of US Customs and DEA actions to hinder hemp seed food imports. Following NAFTA procedures, the company and the US will now select a three-member arbitration panel to attempt to settle the suit. "We met with the US government in March in the hope of avoiding a protracted trade dispute, but the Bush administration failed to recognize that Kenex's products are legal under current law," said Joe Sandler, a Kenex attorney, in a press release this week. "Our client has no choice but to seek compensation under NAFTA."

In 1999, the DEA seized a Kenex shipment and threatened the company with $500,000 in fines, arguing that the foods violated the Controlled Substances Act (CSA) because they contained traces of naturally occurring THC. The DEA argued that hemp seed foods could trigger positive results in drug tests, a proposition refuted by numerous international studies. After Kenex successfully argued that that hemp products were exempt from the CSA, the DEA backed off, but by then Kenex had already suffered damages in the form of lost customers.

Under NAFTA, companies from a member company can sue the governments of other member countries for damages due to unfair or discriminatory trade policies.

Visit http://www.votehemp.com for further information.

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