Intra-EU BIT Archives - international litigation blog
116
archive,category,category-intra-eu-bit,category-116,ajax_fade,page_not_loaded,,select-child-theme-ver-1.0.0,select-theme-ver-3.4,wpb-js-composer js-comp-ver-4.12.1,vc_responsive
 

Intra-EU BIT

June 16, 2022 In Energy Charter Treaty, Intra-EU BIT, Investment Law By Quentin Decleve

CJEU finds Belgium’s request for an Opinion on the compatibility with EU law of the draft modernized ECT inadmissible

The Court of Justice of the European Union (the CJEU) delivered today (16 June 2022), its Opinion on the issue put forward by the Belgian government on whether the draft modernized Energy Charter Treaty (the ECT) (and the investor-State arbitration (ISDS) clause contained in Article 26 of the ECT) was compatible with EU law (check our former article).

The CJEU found this request for an Opinion to be inadmissible.

According to the CJEU, it “does not have sufficient information on the content and, more particularly, on the scope of Article 26 which will appear in the modernised ECT, even though that scope is the subject of the present request for an Opinion“.

The CJEU also reminded that it has already ruled on the question of the compatibility of Article 26 of the ECT with the EU Treaties and that it is clear from the judgment in Komstroy that “compliance with the principle of autonomy of EU law, enshrined in Article 344 TFEU, requires Article 26(2)(c) of the ECT to be interpreted as meaning that it is not applicable to disputes between a Member State and an investor of another Member State concerning an investment made by the latter in the first Member State“.

The Opinion of the CJEU is available here.

0
November 30, 2021 In Intra-EU BIT, Recognition and enforcement of arbitral awards By Various authors

PL Holdings: Ad Hoc Arbitration Clause Cannot Be Used to Circumvent Invalid Arbitration Clause in Intra-EU BIT

This article has been co-authored by Nicholas Lawn (Partner at Van Bael & Bellis) and Isabelle Van Damme (Partner at Van Bael & Bellis), Quentin Declève (Senior Associate at Van Bael & Bellis) and Rebecca Halbach (Associate at Van Bael & Bellis)

On 26 October 2021, the Court of Justice of the European Union (the CJEU) decided, in its judgment in Case C-109/20 Republic of Poland v PL Holdings, that where an investor-State arbitration clause in an intra-EU bilateral investment treaty (BIT) is invalid under European Union (EU) law, investors cannot rely on a tacit ad hoc arbitration agreement with identical content to the arbitration clause. Importantly, the CJEU clarified that EU Member States must contest the jurisdiction of an arbitral tribunal in such a situation and national courts of the Member States must uphold an action to set aside an arbitration award made on the basis of an arbitration agreement that is contrary to EU law.READ MORE

0
September 28, 2021 In Energy Charter Treaty, Intra-EU BIT, Investment Law By Quentin Decleve

Can EU Member States Replicate Plurilateral Agreement on Intra-EU BITs to Implement Komstroy Judgment?

On 2 September 2021, the Court of Justice of the European Union (the CJEU) handed down a judgment in Republic of Moldova v. Komstroy LLC, in which it ruled that intra-EU investment arbitration under the Energy Charter Treaty (ECT) was incompatible with EU law.

As a consequence of that judgment, the European Union and the EU Member States will soon need to take appropriate actions to implement and manage the legal consequences of that decision.

In this short blog post, I share some of my thoughts that I developed when preparing for my presentation at the 2020 EFILA Conference and where I specifically discussed the possibility for EU Member States to exclude intra-EU ISDS arbitral proceedings from the scope of the ECT through the adoption of a plurilateral inter se agreement (the Plurilateral Agreement) similar to the one they adopted to terminate their respective intra-EU BITs. READ MORE

0
September 10, 2021 In Annulment of arbitral awards, Energy Charter Treaty, Intra-EU BIT By External Contributor

Some Initial Reflections on CJEU’s Decision to Uphold Jurisdiction in Case C-741/19 (République de Moldavie)

By Giorgia Sangiuolo, Fellow at the Centre of European Law, King’s College London

On 2 September 2021, the Court of Justice of the European Union (the CJEU or the Court) rendered its decision in Case C-741/19 (République de Moldavie)[1]. The decision was given in the context of a reference for a preliminary ruling received from the Paris Court of Appeal on the interpretation of the Energy Charter Treaty (the ECT) in proceedings to set aside an international arbitral award rendered in a dispute between a Ukrainian investor and Moldova.

Following the conclusions reached by Advocate General Szpunar last March[2], the Court concluded that:

– it had jurisdiction to issue a preliminary ruling interpreting an international treaty to which the EU and some Member States are a party in a case which involved neither of them; and

– the application of the Investor State Dispute Settlement (ISDS) mechanism under Article 26 of the ECT between Member States is incompatible with EU law.

On this basis, the Court then moved to provide the referring French court with an interpretation of the concept of “investment” in Article 1(6) of the ECT.

This post sets out some initial thoughts on the decision of the CJEU to assume jurisdiction. After setting out the background of the dispute (section 1) and the reasoning of the CJEU on this point (Section 2), the post maintains that the judgment, and Advocate General Szpunar’s Opinion that the Court closely followed, seem to go well beyond judicial precedents and appear decoupled from any concerns regarding the risk of fragmentation of EU law (Section 3).

The post then concludes that the judgment seems to suggest that any link, however small, with EU law may be relied upon by the Court to interpret international treaties to which the EU is a party, together with its Member States, even when they have a merely potential, future relevance for EU law (section 4). It is argued that the Court’s decision in République de Moldavie seems to be guided by practical aims and seems to reveal that the Court intends to take an active role in shaping the external relations of the EU. The post finally observes that the Court’s decision may have some relevant practical consequences: parties to future ISDS proceedings under EU agreements, whether mixed or exclusive, regardless of their ties with the EU, will want to keep this case in mind if they wish to avoid the involvement of the CJEU in follow on proceedings before the national courts of the Member States.READ MORE

0
September 9, 2021 In Annulment of arbitral awards, Energy Charter Treaty, Intra-EU BIT By Various authors

Case C-741/19: CJEU Decides That Intra-EU ECT Arbitration Is Incompatible with EU Law and Interprets Definition of “Investment” in ECT

This article has been co-authored by Nicholas Lawn (Partner at Van Bael & Bellis) and Isabelle Van Damme (Partner at Van Bael & Bellis), Quentin Declève (Senior Associate at Van Bael & Bellis) and Rebecca Halbach (Associate at Van Bael & Bellis)

On 2 September 2021, in its judgment in Case C-741/19, Republic of Moldova v. Komstroy LLC, the Court of Justice of the European Union (the CJEU) decided that intra-EU arbitration under the Energy Charter Treaty (the ECT) is incompatible with EU law. It also gave a restrictive interpretation to the definition of “investment” in the ECT.

The CJEU was seized by a request for a preliminary ruling from the Paris Court of Appeal which was hearing an action to annul the arbitral award which had been rendered by an ECT tribunal established to hear a dispute between the Republic of Moldova and Energoalians, a Ukrainian distributor.

Despite the fact that the underlying award involved the application of the ECT to a dispute between an investor from a non-EU country (Ukraine) and another non-EU country (Moldova), the CJEU nonetheless confirmed its jurisdiction to interpret the ECT. Moreover, notwithstanding that the dispute did not involve an investor of one EU Member State acting against another EU Member State regarding an investment made by the former in the latter (an intra-EU dispute), the CJEU found that Article 26(2)(c) of the ECT must be interpreted as being inapplicable to intra-EU disputes. It adopted a reasoning similar to that developed in its 2018 Achmea judgment (see here). In doing so, the CJEU also reached the same conclusion as Advocate General Szpunar in his Opinion and appeared to pre-empt the question of the compatibility of the draft modernised ECT with the EU Treaties, currently pending before the CJEU in Opinion 1/20.

Of the three questions referred by the French court, the CJEU limited its analysis to the first question. It interpreted the term “investment” as excluding “the acquisition, by an undertaking of a Contracting Party to [the ECT], of a claim arising from a contract for the supply of electricity, which is not connected with an investment, held by an undertaking of a third State against a public undertaking of another Contracting Party to that treaty“.READ MORE

0
November 19, 2020 In Intra-EU BIT, Investment Law By Quentin Decleve

CJEU’s Advocate General Hints at Invalidity of Intra-EU ISDS Disputes Based on Energy Charter Treaty

I wanted to publish a short note on an Opinion handed down by Advocate General Saugmandsgaard Øe in which he provides his own personal answer to one of the most highly debatable questions among EU and arbitration practitioners. Namely, the impact of the Achmea judgment on intra-EU Investor-State disputes (ISDS) conducted pursuant to the Energy Charter Treaty (ECT).READ MORE

0