Energy Charter Treaty

2021 in Review, Achmea, ECJ, Energy Charter Treaty, EU Law, Europe, European Union, Micula, Multilateral Investment Court

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Looking back on 2021, one realizes that for those interested in the intersection between EU law and investment arbitration, it was a busy year. As part of our customary “year-in-review” series, this post offers a brief overview of the key investment arbitration-related developments in Europe and their coverage on the Blog. I have grouped these…

ECT Modernisation, Energy Charter Treaty, EU Law, EU Permanent Court, Regime Interaction, Regime Interaction in Investment Arbitration

(NL-Investmentconsulting)/ /Leave a comment

Once upon a time, not so long ago, the two legal orders of on the one hand, international investment law (i.e., International Investment Agreements (IIAs) and investor-State arbitration provisions (ISDS)), and on the other hand, EU law, were peacefully co-existing next to each other with only occasional contact. Indeed, it was the time when the…

Achmea, Energy Charter Treaty, Intra-EU ISDS, Investment

, (Reed Smith)/ /1 Comment

The Court of Justice of the European Union (CJEU) ruled that the Investor-State Dispute Settlement mechanism provided for by the Energy Charter Treaty (ECT) (Article 26(2)c) is not applicable to intra-EU disputes (C-741/19). In the same decision, it also decided that the acquisition of a claim arising from an electricity supply contract does not constitute…

Achmea, Arbitration Proceedings, Climate change, Energy Charter Treaty, International arbitration, Investment Arbitration, ISDS, Netherlands, Paris Agreement

(Smallegange, Dutch Arbitration Association)/ /Leave a comment

Western European countries have taken divergent approaches to dealing with the consequences of shutting down power plants while transitioning towards cleaner energy sources. On one side, Germany resolved the resulting compensation disputes by making settlement payments to the owners of affected nuclear and coal power plants. In contrast, the Netherlands appears reluctant to similarly compensate…

ECT Modernisation, Energy Charter Treaty, ISDS Reform

(Durham Law School) and (Australian National University)/ /Leave a comment

From 20-26 July last year, this Blog ran a series on the Energy Charter Treaty (ECT) modernisation process. The Energy Charter Conference (the Conference) had recently established a Modernisation Group (the Subgroup) to conduct the modernisation negotiations, and the series aimed to provide updates to readers on various aspects of that process. At the time…

Achmea, Admissibility, Arbitration, Arbitration Proceedings, CJEU, Domestic Courts, Energy Charter Treaty, German law, Germany, ICSID, International arbitration, Investment Arbitration, Netherlands, UNCITRAL

, (Nishimura & Asahi)/ /1 Comment

The Achmea saga has taken yet another twist. In a recent communication to the Dutch Parliament, the Dutch Ministry of Economic Affairs and Climate disclosed that it initiated “anti-arbitration” proceedings before the German courts on 11 May 2021 to “avert” two ECT-based ICSID arbitrations brought against it by the German energy companies RWE and Uniper (“Communication”)….

Arbitration Institutions and Rules, BIT, Climate change, Energy Charter Treaty, Environment, Human Rights, International arbitration, Investment Arbitration, ISDS, PCA, Permanent Court of Arbitration, Space Arbitration

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International arbitration is changing at a fast pace, and opportunities arise every day in this field. In this context, on May 25, 2021, Young Arbitral Women Practitioners, Holland & Knight, and Rising Arbitrators Initiative co-hosted a webinar to discuss emerging fields of practice for arbitration lawyers. This post offers an overview of the variety of…

Energy Charter Treaty, Investment Arbitration, Set aside an arbitral award, The Netherlands, Yukos

(Lévy Kaufmann-Kohler)/ /Leave a comment

On 23 April 2021, Paul Vlas, Advocate-General of the Dutch Supreme Court issued his opinion in the Yukos case, setting the stage for the final setting aside act in The Hague after nine years of PCA-administered arbitration and six years of setting aside litigation. Advocate-General Vlas had previously advised the Dutch Supreme Court to reject…

CJEU, Energy Charter Treaty, European Law, European Union, Intra-EU ISDS, Investment Arbitration, Investment Disputes

, (International Investment Law Centre Cologne)/ /Leave a comment

The investor-State dispute settlement (ISDS) mechanism provided by Art. 26 (2) (c) of the Energy Charter Treaty (ECT) is highly relevant to the protection of intra-EU investments.1)In 2018, about 45 per cent of all treaty-based intra-EU investment arbitrations were brought pursuant to the ECT. See UNCTAD, Fact Sheet on Intra-European Union Investor-State Arbitration Cases, IIA…

CJEU, Energy Charter Treaty, International arbitration, International Investment Arbitration, Intra-EU BITs, Intra-EU Investment Arbitration, Investment Arbitration

(European Institute, London School of Economics)/ /Leave a comment

Intra-EU investment agreements and arbitration have been a highly divisive issue in European policy circles for decades. The European Commission has been forcefully pushing for the termination of these agreements since the early 2000s. It criticised inter alia that intra-EU investment agreements and arbitration undermine the European legal order and create inequality among European investors…

CJEU, ECJ, Energy Charter Treaty, European Union, Intra-EU Investment Arbitration, Intra-EU ISDS, Investment

(NL-Investmentconsulting)/ /7 Comments

No doubt, the Energy Charter Treaty (ECT) has become the hottest topic in the investment treaty arbitration world. Not only are EU Member States the most frequent respondent in ECT disputes – for example, the Netherlands has recently received its first ECT claim – but the ECT itself is currently in the middle of a…

Achmea, ECT Modernisation, Energy, Energy Charter Treaty, Fair and Equitable Treatment

(Curtis, Mallet-Prevost, Colt & Mosle LLP), (Foley Hoag LLP), and (Hughes Hubbard & Reed LLP)/ /Leave a comment

On December 11, 2020, the Dispute Resolution Interest Group (“DRIG”) of the American Society of International Law (“ASIL”) hosted a webinar on “The Future of Investor-State Dispute Settlement under the Energy Charter Treaty.”  The event featured Amaia Rivas Kortazar, André von Walter, Crina Baltag, and Yuriy Pochtovyk, and was moderated by DRIG co-chairs Simon Batifort…

Achmea, Arbitration Institutions and Rules, ECT Modernisation, Energy Charter Treaty, Environment, European Union, International arbitration, Investment Arbitration

(Ministry of Climate and Environment, Republic of Poland)/ /Leave a comment

Following a highly-publicized diplomatic battle among the EU Member States (MS), the EU revealed in mid-February its proposal to amend the ECT’s definition of the “Economic Activity in the Energy Sector” (EAES). The announcement allayed fears of the intra-EU discussions on the matter falling apart. Insofar as it sets forth a vision for amendments that…

CJEU, Energy Charter Treaty, Enforcement, Enforcement of an award that was set aside

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On 15 January 2021, the United States Court of Appeals for the District of Columbia Circuit (“DC Circuit Court”) handed down its decision in LLC SPC Stileks v. Republic of Moldova, No. 19-7106 (D.C. Cir. 2021)—a case concerning the confirmation of an arbitral award against the Republic of Moldova. The US courts confirmed the award…

Climate change, Energy Charter Treaty, Germany, Investment Arbitration, Legitimate Expectations, Parallel Proceedings

(Herbert Smith Freehills)/ /Leave a comment

Swedish state-owned power energy company Vattenfall operated two nuclear power plants located in Brunsbüttel and Krümmel, Germany. Vattenfall owns a 50% interest in the Krümmel plant, and a 66.6% interest in the Brunsbüttel plant. In August 2011, against the backdrop of the nuclear disaster in Fukushima, Japan, the German Parliament amended the Act on the…

BIT, Energy Charter Treaty, Fair and Equitable Treatment, Investment Arbitration, Investment protection, Investment Treaties, Investor-state tribunals, Legitimate Expectations

(University of Passau)/ /Leave a comment

In the early 2000s, several European states introduced generous incentive programs to attract investors to renewable energy, triggering an investment boom. In the wake of the global financial crisis of 2008, however, the incentive payments put a strain on regulators. The subsequent changes to the regulations of the renewable energy sector implemented by Spain, Italy,…

Energy Charter Treaty, Fair and Equitable Treatment, Uncategorized

(Nyenrode Business University)/ /Leave a comment

Traditionally, one of the central pillars of the FET standard has been the protection of legitimate expectations. Legitimate expectations can be either based on a host state’s specific representations provided to the investor, or, under certain conditions, such expectation can be based on the regulatory framework that existed at the time of making the investment….

Australia, Energy, Energy Charter Treaty, Investment Arbitration, Renewable energy

(Herbert Smith Freehills LLP) and (Herbert Smith Freehills)/ /1 Comment
ACICA 45

The Renewable Energy Target (RET), Australia’s key policy instrument for encouraging electricity generation from renewable sources, has been described as a policy hampered by politicisation. Notwithstanding such criticism, in 2019, it was reported that Australia’s energy system is undergoing the transition to renewables faster than any other country in the world.1)Blakers et al., (2019) “Pathway…

COVID-19, Energy Charter Treaty, ICSID Convention, Insolvency

, (LIPMAN KARAS)/ /Leave a comment

COVID-19 has already destroyed many businesses, and insolvencies will only increase as governments withdraw temporary protections. Recent decisions highlight the potential for external administrators of these insolvent companies to use investment treaty arbitration to recover assets, even from the state that appointed the administrators. Generally, external administrators are appointed by directors, creditors or courts to…

Achmea, Energy Charter Treaty, Intra-EU ISDS, Investment Arbitration, Investment Disputes

(E&A Law Limited)/ /Leave a comment

Since Achmea there has been much debate on whether its reasoning invalidates ECT intra-EU investor state clauses as a matter of EU and international law. The recent AG’s Opinion in Cases C‑798/18 and C‑799/18 does not provide an answer to this question as a matter of EU law. A review of CJEU case law in…

Belgium, CJEU, ECT Modernisation, Energy Charter Treaty, Intra-EU ISDS, Investment Arbitration

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On 3 December 2020, Belgium announced the submission of a request to the Court of Justice of the European Union (“CJEU”) for an opinion on whether the intra-European application of the arbitration provisions of the future modernised Energy Charter Treaty (“ECT”) are compatible with the EU Treaties. Belgium indicated that the purpose of its request…

Arbitration, ECT Modernisation, Energy Charter Treaty, EU Law, European Union, Investment Arbitration, Reform

(University of Bedfordshire)/ /Leave a comment

The Energy Charter Treaty (ECT) has recently become a household name, moving from the oblivion of the 1990s, when the treaty was drafted, to one of the most hotly debated topics in legal (and other) circles nowadays. Some have demonized it as an instrument for the corporate usurpation of democratic functions, such as the host…

ECT Modernisation, Energy Charter Treaty, Environment, European Union

(Boies Schiller Flexner LLP) and (Charles University)/ /Leave a comment

The signatories of the Energy Charter Treaty (“ECT”) have begun the process of the Treaty’s modernisation. This is by no means a small task given the complexity of the Treaty’s scope which covers energy trading, efficiency, transit, investment protection and dispute resolution. Additionally, in order to amend it, all the signatories need to be on…

ECT Modernisation, Energy Charter Treaty, Fair and Equitable Treatment, International arbitration, Investment Arbitration

(Durham Law School) and (Magnusson Minds)/ /Leave a comment

The investment protection mechanism in the Energy Charter Treaty (ECT) is meant to, among other things, promote, attract, and protect foreign investments in the member states’ energy sectors. In 2018, the Energy Charter Conference announced its list of approved topics for the modernization of the ECT. The list included several substantive investment protection provisions. This…