IMPORTED CONSENT: AN ELEPHANT IN THE ROOM
Por: Alejandro Castellanos Mier
The Bilateral Investment treaties have been a significant development of the public international law, particularly from the diplomatic protection realm, since they embody the very core of the Arbitral Investment Law: protection standards granted to foreign investors on behalf of the host state in which an investment is made. In other words, the objective pursued by the signature and enforcement of BIT´s is to assure that foreign investors are not subject to a less favorable treatment in regard to the national investors.
In first instance, on the basis of the foregoing , for an investor
to be covered by the BIT protection standards, for which the host state of the
investment is entitled to, he has to be legally deemed as one in
terms of the Agreement. That is to say, basic legal requirements
such as nationality, and business/ commercial activities
falling within the definition of investment set forth on the
BIT, has to be complied. Nationality is, in first place, the vehicle for
the enforcement of international law[1]
In regard to the first mentioned requirement it must be taken into
account that nationality is not determined by international law but by the
state, who is the entity coated with authority to enact laws that concern the
nationality of its citizens. As has been acknowledged by international
tribunals rationale, nationality is accepted to be, in principle,
within the scope of internal jurisdiction[2] in first place. As putted forward by
the tribunal in Soufraki V. UAE:
“It is accepted in international law that nationality is
within the domestic jurisdiction of the State, which settles, by its own
legislation, the rules relating to the acquisition (and loss) of its
nationality. Article 1(3) of the BIT reflects this rule. But it is no less
accepted that when, in international arbitral or judicial proceedings, the
nationality of a person is challenged, the international tribunal is competent
to pass upon that challenge. It will accord great weight to the nationality law
of the State in question and to the interpretation and application of that law
by its authorities. But it will in the end decide for itself whether, on the
facts and law before it, the person whose nationality is at issue was or was
not a national of the State in question and when, and what follows from that
finding. Where, as in the instant case, the jurisdiction of an international
tribunal turns on an issue of nationality, the international tribunal is
empowered, indeed bound, to decide that issue.[3]
However, internal legislation of states does not override the
incidence of international law standards, for in accordance with international
law state´s decisions on nationality for municipal purposes are not
spontaneously conclusive or definitive for international law purposes.
Referring to municipal law is insufficient for a Tribunal to determine the
nationality criteria, there is more needed than the sole recognition by a state[4]
Consequently, international investment tribunals are not expected
to inquiry a sovereign act of state, such as the nationality recognition but to
analyze whether or not said act is entitled to produce effects in international
law, since it is a generally recognized rule of international law that
nationality is, lastly, defined by international law and not by municipal law per
se[5]. In this vein, international tribunals
are entitled to review the nationality issue in accordance to state domestic
legislation, on one hand, for states municipal law are raised to international
law sphere at the moment contracting parties chose to make it the applicable
law to an eventual international law controversy[6]. In other words, the applicable law to
any dispute between a national of a contracting party that holds an investment
in the other contracting party’s territory is the Bilateral Investment Treaty.
Thus, when the international Agreement does a renvoi to
municipal law, it automatically becomes part of the applicable law to the
dispute. For this reason, the Tribunal may use it and apply it as it would use
and apply any other disposition of the treaty
On the other hand, from the international law perspective,
jurisprudential practice has established that the nationality effects
recognition by international law would only happen if such nationality is an
effective one[7]. As provided by the ICJ, the principle of
the effectiveness of nationality contains a juridical
link based on a social fact of connection, an effective solidarity of
existence, of interests and feelings united to a reciprocity of rights and
duties[8]. For an instance, in the
Nottebohm case, the ICJ stated:
“The naturalization of Nottebohm was an act performed by
Liechtenstein in the exercise of its domestic jurisdiction. The question to be
decided is whether that act has the international effect here under
consideration¨[9]
Likewise, in second instance, the subject business and commercial
activities have to fall within the definition of investment set
forth by the pertinent agreement, for him to be considered as an ¨Investor¨
under the BIT. Practically, this means that the investor owns an
investment in the territory of one contracting party in accordance with the
laws and regulations of the latter and, as provided above, that it is a
national of the other contracting party.
The ¨investment¨ definition may vary from one BIT to another, but
generally speaking the term investment usually can compromise: Movable and
immovable property as well as other property rights, shares of companies or any
form of participation in a company, claims to money or to any performance under
contract having a financial value associated with an investment, intellectual
property rights, such as patents, industrial designs, technical processes,
know-how, trade secrets, trade names and goodwill associated with an
investment, any right conferred by laws or under contract and any licenses and
permits pursuant to laws, including concession to search for, extract,
cultivate or exploit natural resources.
These two legal requirements have direct relation with the
Tribunal competence, because the tribunal has jurisdiction according to the law
governing the dispute. Accordingly, if one of them fails to be proven the legal
consequence that would follow is the tribunal´s lack of jurisdiction, the claim
will result to be inadmissible and it would not even proceed to review the
merits stage.
Now, moving on into the real object and purpose of this essay,
let’s assume for a moment that the investor does fulfill both ¨nationality¨ and
¨investment¨ criteria. In this sense, he would be subject to the protection
standards set forth on Bilateral Investment treaties. Although, there are
multiple significant protection standards that investor could recourse to when
having a possible litigation against the host state such as: fair and equitable
treatment, direct or indirect expropriation criteria, fork in the road clause,
umbrella clause, this essay will focus on a particularly problematic
clause, in terms of the investor protection and more favorable
treatment: the MFN clause and its relationship it has with the arbitral agreement.
Putted into another way, whether an arbitral agreement concluded within a third
treaty ( signed between another party and the same host state) can
be, or not, incorporated or imported from a third BIT to the basic in virtue of
the MFN operation.
As a matter of facts, the MFN Clause answers to the very core of
investment arbitration ( the protection with which foreign investments have to
count with when investing in a host state) inasmuch as each contracting
party accord, within its own territory, to investments made by
investors of the other contracting party, to the income activities related
to such investments and to other matters regulated by the Agreement (
Depending, off course, on how the particular MFNC has been drafted and the
wording it implements on a BIT ), a treatment that is no less favorable than
that accorded to its own investors or investors from third party
countries. In this fashion, the MFNC operates to incorporate
provisions of a third treaties that have not been drafted in the basic treaty
in first place. In the scenario where more favorable treatment is
granted through the provisions of a third treaty, the more favorable
provision can be claimed by the basic-treaty-investor through the MFNC
established on the basic treaty.
Both the ICJ and the ILC have expressed their understanding of the
functioning and effect of the MFN Clause. The ICJ rationale behind
the Rights of Nationals Of the United States of America in Morocco
Case putted forward that the effect of MFNC was that the more
favorable treatment is extended IPSO IURE. This fact is
preceded by the courts conclusion that, in the case, The United States acquired
by virtue of the most-favored-nation clauses, civil and criminal consular
jurisdiction in all cases in which the United States nationals were defendants[10]. Consequently, in that case the MFN
allowed to automatically vest the USA defendants with civil and consular
jurisdiction, USA did not had to claim against Morocco in order for the
court to grant such jurisdiction.
Much like the ICJ, the ILC supports the court´s perspective
through the Article 9 (1) of the ILC Draft Articles on MFN Clauses providing
that ¨the beneficiary State acquires, for itself or for the benefit of persons
or things in a determined relationship with it¨[11] the more favorable treatment
accorded to third states or their nationals. This Article, all along with the
rest of ILC Draft Articles related provisions, establishd that the effect and
the functioning of the MFNC is to empower the beneficiary of the clause to
acquire the more favorable treatment, for the beneficiary does not
only has a claim to any more favorable right, but tittle to such more favorable
treatment[12]. So much so that the ILC Commentary
clarifies that ¨the Effect of the Most-favoured-nation process is, by means of
the provisions of one treaty, to attract those of another¨[13]. Article 20 of the Draft Articles
asserts that ¨The rights of the beneficiary state, for itself or for the
benefit of persons or things in a determined relationship with it, to most
favored nation treatment… arises at the moment when the relevant treatment is
extended by the granting state to third State or to persons or things in the
same relationship with with that third State¨[14] As a result, being the MFN a
mechanism of automatic extension, the beneficiary under the basic treaty can
rely on the more favorable treatment ipso iure without any additional
act of transformation[15]
About concerning the import of consent within a third
treaty arbitral agreement through the MFN operation, it must be taken into
account whether the MFN clause applies to a more favorable jurisdictional treatment,
that an investor from a third BIT is granted with. This issue is
not, unfortunately, subject to a general standard but to a case-by-case
analysis, because, the way in which the MFN clause is worded may vary from
treaty to treaty. Nevertheless, most of the time said clause refers, in one way
or another, to the word ¨treatment¨. In this sense, even in spite of the
existence of consistent doctrine and jurisprudence over the inapplicability of
the MFN Clause to the arbitral agreement, which will be put forward, this essay
intends to conclude that whenever the parties to a treaty drafted
the MFN Clause in such a way that it can be broadly construed, the ¨treatment¨
standard is understood to cover the consent of the host state to
arbitration under a third BIT, even though, to many, we could be standing before
a procedural provision that authorize jurisdictional mandate.
In the core of a negative-counter argument the MFNC
interpretation, on one hand, and the Arbitral Agreement interpretation, on the
other, plays a decisive role on whether its operation allows to import the
consent set forth on a third treaty, an accurate interpretation that
establishes up to what point the ¨treatment¨ standard can be considered as an
implied consent to arbitration. Accordingly, bearing in mind the special nature
of the Arbitral Agreement[16], under this standpoint is possible to
assert that this interpretation encompasses VCLT Article 32 provision[17], for it can be applied when a
treaty clause is necessary to confirm its meaning, serving as possible aid to
interpretation[18], although the use of supplementary
interpretation is always a discretionary aid. Also because it is
reasonable that the host state, which is responsible for drafting the clause,
should not be allowed to rely on the ambiguity of the clause, resulting from
its drafting.
For instance, the principles of interpretation that are usually
applied to arbitration agreements are the same as the general principles
usually applied to contracts[19]. In accordance with international law
arbitration decisions, a dispute settlement provision, in particular
arbitration agreements, should be interpreted restrictively[20]. Wherefore, the Agreement should be
¨strictly¨ construed because the task conferred to the arbitrators should be
confined to follow the clearly expressed intentions of the parties[21]. As stated by Douglas in regard to
arbitral tribunals approach to the MFN operation on this matter ¨A MFNC in the
basic treaty does not incorporate by reference provisions relating to the
jurisdiction of the arbitral tribunal, in whole or in part, set forth in a
third investment treaty, unless there is an unequivocal provision to that
effect in the basic investment treaty¨[22] . This legal doctrine seems to be
consistently repeated by Chukwumerije, as presented on Nartnirun Jungam book
¨MFN Clause and BIT Dispute Settlement: A Host State`s Implied Consent to
Arbitration by Reference¨[23], and further ratified by investment
arbitration jurisprudence. Whereas the first asserts that “ Consent to
arbitration determines the applicability of the MFN clause to jurisdiction.
Such a consent must be specific and unambiguous¨, the tribunal on Plama
Consortium V. Bulgaria, in harmony with Berschander V.
Russia tribunal rationale[24], asserted that:
“A clear and unambiguous agreement of the parties to arbitrate was
still required. Thus, it rejected the Claimants contention that such an
agreement could be reached through incorporation by reference in the absence of
the parties’ clear and unambiguous intent. In other words, the broad MFNC alone
would not fulfill the clear and unambiguous requirement for jurisdiction
purposes.”[25]
Thus, under the negative-counter perspective, it is possible to
conclude that unless the pertinent treaty provisions particularly specifies on
a clear and unambiguous way that the MFNC applies to dispute settlement
provision it shall not be invoked to broaden the state consent to international
arbitration.
Nevertheless, even if said negative argument does transmit a
logical reasoning is not imperative nor definitive in terms of treaty
interpretation. As has been said before, the legal ground from which a
restrictive approach derives from (Article 32 of the Vienna Convention on Law
of Treaties) is a subsidiary and discretionary aid of interpretation. In other
words, treaty provisions are not Prima facie construed
according to Article 32 of the VCLT, but under the light of Article 31 which
applies to any treaty provision irrespectively of their nature. Arbitrators are
not allowed to interpret the intention of the parties beyond to what is set
forth by the terms of the Agreement. Hence, if after analyzing the treaty
wording in relation to the ordinary meaning of the words is necessary to
confirm its meaning, Article 32 subsidiary applicability shall be utilized.
Here are some examples of BIT MFN clauses wording:
ARTICLE 3 UK-ARGENTINA BIT
1) Neither contracting party shall in its territory subject
investments or returns of investors of contracting parties to treatment
less favorable than that with which it accords to investments of its own or investments
and investors from third parties
2) Neither party shall in its territory subject investors from other
Contracting Party, as regards their management, maintenance, use, employment or
disposal of their investments, to treatment less favorable than that with which
it accords to its own investors or investors of third state parties.
Article 7: ARGENTINA-SPAIN BIT.
MORE FAVOURABLE TERMS
1.) Where a matter is governed by this Agreement and also by
another inter national agreement to which both Parties are a party or by
general international law, the Parties and their investors shall be subject to
whichever terms are more favourable.
2.) Where one Party, on the basis of specific laws,
regulations, provisions or contracts, has applied to investors of the other
Party terms more advantageous than those provided for in this Agreement, such
investors shall be accorded the more favourable treatment
Article 3 ARGENTINA-GERMANY BIT (1991) (1) Neither Contracting Party shall
subject investments in its territory by or with the participation of nationals
or companies of the other Contracting Party to treatment less favourable than
it accords to investments of its own nationals or companies or to investments
of nationals or companies of any third State. (2) Neither Contracting Party
shall subject nationals or companies of the other Contracting Party, as regards
their activity in connection with investments in its temtory, to treatment less
favourable than it accords to its own nationals or companies or to nationals or
companies of any third State. (3) Such treatment shall not include privileges
which may be extended by either Contracting Party to nationals or companies of
third States on account of its membership in a customs or economic union,
common market or free trade area. (4) The treatment under this article shall
not extend to privileges accorded by a Contracting Party to nationals or
companies of a third State by virtue of an agreement for the avoidance of
double taxation or other tax agreements
As shown, parties accord a broad standard of ¨treatment¨ no less
favorable . Therefore, The MFN Clause and National treatment ( where
applicable) protection granted through treatment on
behalf of the host state seems to apply to the investment and activities
related to the latter, as specified on the previous clauses and many
others on the proliferation of BIT´s. When this is the case, what
the clause shows when referring to most favorable ¨treatment¨, to ¨activities
related to such investments¨ or ¨other matters regulated by the agreement¨ is
that parties, having the possibility to do so, did not exclude the dispute
settlement provision from the scope and application of the MFNC. Hereinafter,
international tribunals first approach towards an MFNC shall be made through
the ordinary meaning of the clause wording, as stressed by the world
bank ICSID jurisdiction in cases such as National Grind V. Argentina and Simiens
V. Argentina, respectively[26]. This is because the ordinary meaning of
the words reflects what the parties intent[27]. So much so, that Tribunals shall rely
on the actual wording of the text more than the intention of it[28].
Consequently, when standing before a broadly drafted clause that
does not distinguish between the matters that constitute an object of the
¨treatment¨, it can be understood that the clause covers ¨all aspects¨ of the
investments. That is to say that ¨treatment¨ refers to the entire relationship
between the host state and the comparator. In this fashion, if the
MFNC is construed under VCLT Article 32 and a further restrictive
interpretation in first instance, a tribunal would be then tending to consider
a special meaning of the word ¨treatment¨ that goes beyond its ordinary meaning
of the word.
Firstly, when a clause happens to be drafted in a similar way to
the ones mentioned before, particularly to the Argentina-Spain BIT,
it would be reasonable for a Tribunal to find that the
contracting parties have agreed to treat investments covered by the basic
treaty equally to the investments made by investors from any third country ¨in
all matters¨ governed by the BIT. This interpretation is particularly
conductive with the rationale used by the Suez V.
Argentina Case Tribunal in which the dispute settlement
provisions between a host state and foreign investors undoubtedly constituted
¨a matter¨ governed by the BIT, a matter that was not among the explicit
exceptions to the MFNC. The tribunal established that:
¨The use of the extension ¨in all matters¨ when coupled with a
list of specific exceptions that does not include dispute settlement provision,
leaves no doubt that dispute settlement is covered by the Most-Favored-Nation
Clause¨[29]
In effect, when parties do not include dispute settlement
provision within a list of specific exceptions, it is possible to conclude that
it was not their intention to distinguish the dispute settlement provision from
other provisions set forth on the Agreement. In this sense, if the parties did
not distinguish the provision there is no point for the Tribunal to do so.
Consequently, when dispute settlement provision is put on the very same level of
all those matters governed by the Agreement the argument that the dispute
settlement provision ( arbitral agreement) or the MFNC should be interpreted ¨strictly¨ and
differently from other clauses in the BIT is override. For this reason,
the Suez tribunal, relying on the Maffezzni case, rejected
the Plama case Tribunal´s view that an arbitration
Agreement must be clear and unambiguous, especially if it was incorporated by
reference to a provision in a different treaty[30]
Secondly, besides considering the ¨in all matters governed by
the Agreement paired with a list of specific exceptions¨ standard set forth
on the MFNC, it is advisable to analyze and understand the ¨Treatment¨ and
¨investor¨ standard perse, since they have, by
themselves, a direct relationship with a foreign investor right to recourse to
arbitration ( dispute settlement provision). In spite that in many BITs the
word ¨treatment¨ is incorporated within the MFN and National Treatment clause
without any particular definition, the fact that said word is not defined does
not add any interpretational difficulty to the tribunal´s labor. Insofar as the
¨treatment¨ provision has to be interpreted Under Article 31 of the VCLT
general rule of interpretation, its ordinary meaning within the context of
investment, as asserted by the Suez V. Argentina Tribunal,
shows that the word covers ¨the rights and privileges granted and
the obligations and burdens imposed by a Contracting State on investments made
by investors covered by the treaty¨[31]. In this vein, the word ¨treatment¨ is
sufficiently broad to encompass more favorable procedural and jurisdictional
requirement.
Moreover, the Suez Tribunal gave a particular value to the word ¨investor¨ for
its significance put forward a direct and strong incidence on the right to
arbitration. The Tribunal found that said right was covered by the MFN Clause
as the it is very much related to investor’s management, maintenance, use,
enjoyment, or disposal of their investments. Being particularly related to the
¨maintenance¨ of an investment, because the term inevitably includes
the protection of the latter[32]
Bearing the legal-conceptual dynamic in mind, it
is also important to understand the practical consequences of the inclusion, or
not, of the dispute settlement provision within the MFNC scope. When granting
direct access to international arbitration to third or national investors in
contrary to a dispute settlement provision accorded on a basic treaty, if a
host state does not give consent, investors choices to exercise the right to
arbitration are inferior compared to those of their counterparts protected by
other BITs, since a different treatment exists on the investment
maintenance where an investor may choose between adjudicating bodies
another cannot. If this is the case, the ones that can choose
between adjudicating bodies are treated more favorably in regard to
their management, maintenance, use, employment, or disposal of their
investments. Accordingly, it would be non-sense if the affected investor could
not invoke the basic treaty MFNC in order for him to have a more
favorable treatment.
Finally concerning the substantive v. procedural argument, in
order to clarify whether the origin of the Arbitral Agreement nature falls on a
substantive ground or a procedural one it is vital for us to acknowledge what
is the arbitral Agreement and what is its exact purpose.
On one hand, the will of the parties when drafting an Arbitral
Clause is nothing but the intention to have access to a private jurisdiction in
order for an eventual contract, commercial, administrative or other sort of dispute
be solved under the applicable law and procedures that said parties
accord to. The access to international courts and to administrative tribunals
in all degrees of jurisdiction is, therefore, an area in which the arbitral
agreements are applied[33]. Consequently, the practical
manifestation of both the MFNC and the Arbitral Agreement is nothing but to
serve as an instrument to allocate adjudicatory authority. In this sense, the
right to access to an international tribunal granted by the host state to a
third country investor, does not have any difference with the access
to domestic courts or other dispute settlement mechanism, whether domestic or
international, whether in a permanent court of before an adhoc tribunal.[34]
When consenting to arbitration vis-a vis investors
from one state but not doing so with an investor from another country, the host
state ends setting up two different court systems. Accordingly, what can be
understood as a jurisdictional mandate is ultimately a question of accessing
to justice. Thus, a question of substantive investment protection.[35] This reasoning is
conductive with the Ambatielos Case by the Commission of Arbitration,
in which the adjudicative body asserted that:
¨The admnisitration of justice is closely related to the
protection of the rights of traders. Therefore to the ejusdem Generis Rule.¨ [36]
On the other hand, even if the arbitration agreement jurisdictional
mandate is deemed to have a procedural nature ( which is perfectly possible) it
is necessary to take into account that the basic purpose or sine-
qua- non of the MFNC is to fight discriminatory treatment based on
nationality, and, as a matter of facts, discrimination can not be alleged to
occur only under a mere substantive protection context, but it also
can happen within the dispute settlement procedure realm. Hence, the MFNC has
be equally applicable to both substantive and procedural matters, when it comes
down to discrimination or a less favorable treatment.
[1] European Convention on
Nationality,Pg.1150.
[2] Tunis and Morocco Decrees. p.
24.
[3] Soufraki v. UAE, para 55.
[4] Cfr. Nottebohm, Canevaro,
among others
[5] Hague Convention on Certain Questions Relating
to the Conflict of Nationality Laws, art.1
[6] Tunis and Morocco Decrees. p.
24.
[7] Nottebohm Case (pg.23):
“According to the practice of States, to arbitral and judicial decisions and to
the opinions of writers, nationality is a legal bond having as its basis a
social fact of attachment, a genuine connection of existence, interests and
sentiments, together with the existence of reciprocal rights and duties. It may
be said to constitute the juridical expression of the fact that the individual
upon whom it is conferred, either directly by the law or as a result of an act
by the authorities, is in fact more closely connected with the population of
the State conferring nationality than with that of any other State”.
[8] Nottebohm Case, p. 22
[9] Anne Peters, p. 624 (citing
Johannes M. Chen).
[10] Rights of Nationals of the United
States of America in Morocco (France v United States), Judgment, 27 August
1952, ICJ Reports 1952, 176, at 190 (emphasis added).
[11] ILC Draft Articles on MFN Clauses. Arts
9(2), 10(1) and (2), 11, 12, and 13 of the.
[12] ILC
Draft Articles on MFN Clauses. Arts 9(2), 10(1) and (2), 11, 12, and 13 of the
[13] ILC Report of the 30th Session (n
20), at 30, para 11.
[14] ILC Draft
Articles on MFN Clauses. Arts 20
[15] Renta
v Russia, para 77 (observing that ‘[t]he third-party treaty is incorporated
by reference into the basic treaty without any additional act of
transformation’)
[16] It is said that the arbitral agreement
does have a very special nature, in comparison to other treaty clauses, due to
the fact that an arbitral Agreement is the consequence or derives from the
consent of states and the subsequent consent given by the state from which a
foreign investor is national from. Therefore, the consent cannot be ¨broadly¨
construed as any other treaty clause, but strictly construed because is a
clause product of a really, really careful negotiation. As explained by
Nartnirun Jungam on ¨ MFN Clause and BIT Dispute Settlement: A Host State`s
Implied Consent to Arbitration by Reference¨ At p. 486.
[17] Vienna Convention on Law of Treaties 1969. Article
32 ¨Recourse may
be had to supplementary means of interpretation, including the preparatory work
of the treaty and the circumstances of its conclusion, in order to confirm the
meaning resulting from the application of article 31, or to determine the
meaning when the interpretation according to article 31 : (a) Leaves the
meaning ambiguous or obscure; or (b) Leads to a result which is manifestly
absurd or unreasonable.¨
[18] Anthony Aust, para 248.
[19] Emmanuel Gaillard, p. 226-33
[20] ICC Award No. 4392 (1983),
Yugoslavia Company V. German Company , 110 J.D.I 901 (1983), and obvservations
by Y. Derains.
[21] French Domestic Arbitration,
CA Paris, Mar. 11. 1986.
[22] Douglas. p. 344
[23] Nartnirun Jungam. p 486.
[24] Berschander V. Russia.
P. 179-181.
[25] Plama case. p. 198.
[26] National Grid V. Argentina.
Par. 80 & Siemens A.G v. Argentina, par. 41
[27] Vienna Convention on the Law of Treaties arts. 31, 32. Mark
E. Villiger, at 426
[28] Zachary Douglas, at 48.
[29] Suez et al. v. Argentina. Para
65
[30] Suez et al. v. Argentina. Para
59-66.
[31] Suez v. Argentina. Para 55.
[32] Suez v.
Argentina. para 57
[33] ILC MFN
Draft Articles, Article 4.
[34] Zachary Douglas, MFNC. At
104.
[35] Kevin Lim, at 136
[36] United Nations, Reports of
International Arbitral Awards, 1963. p.107