WCV Capital Ventures Cyprus Limited and Channel Crossings Limited v. The Czech Republic (PCA Case No 2016-12; Court of Appeal of The Hague, Judgment of 24 March 2026)

Overview of the decision

On March 24, 2026, the Court of Appeal of The Hague set aside all three arbitral awards rendered in WCV v. Czech Republic (para. 5.25)^[1] and permanently prohibited the claimants from initiating any new arbitration against the Czech Republic under the BIT concluded between the Czech Republic and the Republic of Cyprus, signed in 2001. The underlying arbitration concerned the claimants’ shareholding in SYNOT, a Czech betting company, and the alleged cancellation of its licences to operate video lottery terminals; the claimants advanced claims for breach of FET, including denial of justice and full protection and security.

The most distinctive feature of this case is its inversion: the losing investor (WCV) sought a set-aside, and the winning state counterclaimed for broader relief prohibiting WCV et al. from initiating arbitration (not seated in the EU) against the Czech Republic under the BIT. The Czech Republic, which had lost its jurisdictional and intra-EU objections before the tribunal, in turn sought to set aside the interim arbitral award on jurisdiction dated April 25, 2018, and the second interim award on intra-EU objection dated September 29, 2020 (para. 4.3). The motives on each side differed. WCV et al. sought a set-aside not to vindicate a procedural principle but to reopen the substantive dispute. Having lost on the merits, annulment was the only available gateway to a second attempt at recovery, whether before a reconstituted tribunal or a court seated outside the EU. The Czech Republic, for its part, was unwilling to let a victory in arbitration leave intact the structural risk of being drawn into fresh proceedings contrary to EU law that, if successful for the investor, could expose it to EU state aid infringement proceedings under the logic of Commission Decision 2025/1235 of 24 March 2025 on State Aid SA.54155 (2021/NN) implemented by Spain, concerning the arbitration award to Antin (paras. 5.21 and 5.24).

The court resolved this inversion by setting aside the awards on the grounds that neither party had primarily advanced, invoking ex officio, the incompatibility of the BIT’s arbitration clause with mandatory EU law under the Achmea line of case law of the CJEU (para. 5.8). Grounding its authority as a European Union court ex officio in Article 19(1) of, and in the member states’ duty of sincere cooperation under Articles 4(3) of, the TEU, as confirmed most recently by the Grand Chamber of the CJEU in its judgment of August 1, 2025 in RFC Seraing v. FIFA, the court held that a mere declaration of incompatibility was insufficient: effective judicial protection required it to go further, barring future BIT-based arbitration under penalty of EUR 100,000 per day (para. 5.21).

The judgment thereby advances the post-Achmea enforcement architecture in three interconnected aspects that warrant close attention: (1) the ex officio invocation of EU public policy as a ground for set-aside; (2) the extension of that logic to prior jurisdictional awards; (3) the deployment of prospective injunctive relief and geographical scope of Achmea. Together, these moves transform the national court from a passive reviewer of arbitral awards into an active enforcer of the EU legal order.

Ex Officio invocation of EU public policy

The first and most structurally significant move is the court’s decision to raise the Achmea incompatibility entirely on its own motion. WCV et al. had grounded their set-aside application in three statutory grounds under Article 1065(1) of the Dutch Code of Civil Procedure: failure to comply with the tribunal’s mandate, insufficient reasoning, and conflict with public policy (para. 4.2). Crucially, however, their public policy argument was directed at the substance of the final award, not at the BIT’s arbitration clause. It was the court itself that identified the foundational incompatibility with (mandatory) EU law and treated it as a freestanding ground for annulment (paras. 5.4, 5.8, 5.11).

The legal basis for this ex officio power rests on two interlocking foundations in Dutch and EU laws. As a matter of Dutch procedural law, the court recalled that public policy under ground (e) of Article 1065(1) of the Code of Civil Procedure may be raised at any stage and by the court on its own initiative, given that its application concerns mandatory rules of such a fundamental nature that procedural restrictions cannot be permitted to impede compliance (para. 5.4). As a matter of EU law, the court invoked the obligation of national courts acting as Union courts under Article 19(1) TEU, supported by the CJEU’s established line from Eco Swiss and Mostaza Claro, requiring ex officio review of compliance with mandatory EU law, binding on all member state authorities including courts by virtue of the duty of sincere cooperation under Article 4(3) TEU.

The substantive content of the public policy violation is equally significant. The court held that the mere risk that the Article 267 TFEU preliminary ruling procedure would be circumvented sufficed. It was irrelevant whether EU law had actually been at issue in the arbitration or whether the tribunal had been asked to apply it. (para.5.9) This is the structural logic of Achmea: an intra-EU BIT arbitration clause is incompatible with EU law not because it necessarily generates wrong results, but because it structurally removes disputes from a system designed to guarantee the coherent and uniform interpretation of EU law. This holding has immediate implications beyond the present case. Any intra-EU BIT award brought before a Dutch court, whether for set-aside or enforcement, is now susceptible to ex officio annulment or non-enforcement on public policy grounds, regardless of whether the parties raise the issue and regardless of the award’s substantive content.

Extension to prior jurisdictional awards

The second move extends the annulment logic upstream to the two interim jurisdictional awards of April 2018 and September 2020. If the final award is set aside on Achmea grounds, does the same logic necessarily reach the earlier awards that established jurisdiction?

The court answered affirmatively. The jurisdictional awards derive their legal force from the same arbitration clause in Article 8 of the BIT, which offers the investor a choice among the local courts, ICSID, UNCITRAL ad hoc arbitration, and the Stockholm Chamber of Commerce, and which the court held to be incompatible with EU law. If the clause cannot ground the final award, it equally cannot ground the procedural decisions that made the final award possible. To set aside the final award while leaving the jurisdictional awards intact would create a legal absurdity: a formally annulled award resting on subsisting findings of valid consent to arbitration, which a resourceful claimant could invoke as a platform for new proceedings elsewhere (paras. 5.16-5.17, 5.23).

The court also noted that WCV et al. had themselves conceded this point at the oral hearing, acknowledging that the jurisdictional awards must fall with the final award. The concession, recorded at para. 5.16, confirms the claimants’ own assessment of the legal landscape and forecloses any argument that the jurisdictional awards could survive on an independent basis.

Prospective injunctive relief and the geographical reach of Achmea

The third and most consequential move is the granting of the Czech Republic’s conditional counterclaim: a permanent prohibition on WCV et al. initiating any new arbitration against the Czech Republic on the basis of the BIT, whether seated inside or outside the EU, backed by a penalty of EUR 100,000 per day up to a ceiling of EUR 133 million (paras. 5.18–5.24). The express inclusion of non-EU-seated arbitration directly addresses the structural gap at the heart of the post-Achmea enforcement architecture. Achmea binds member state courts and forecloses EU-seated intra-EU arbitration but says nothing about proceedings before tribunals elsewhere that owe no allegiance to CJEU jurisprudence and whose awards may be enforced before courts equally unconstrained by EU law. This is precisely the scenario the court identified: WCV et al.’s pursuit of a set-aside of an award that had dismissed their own claims revealed an intention to find a new legal avenue outside the EU rather than accept the outcome (para. 5.24).

The court reinforced the injunction with a structural consideration that extends beyond the bilateral dispute. Drawing directly on Commission Decision 2025/1235 on the Antin award (para. 5.21), it noted that compliance with any future favourable award would risk constituting unlawful state aid under EU law, exposing the Czech Republic to State Aid proceedings under Article 108 of the TFEU, including a recovery order of the kind addressed to Spain in that decision.

There is a notable echo here of the dissent of Professor Marcelo G. Kohen, who joined the tribunal as the respondent’s appointee in place of Mark A. Clodfelter. In Professor Kohen’s dissenting opinion to the Second Interim Award of September 2020. he had warned that the majority’s treatment of EU law and investment law as parallel “sub-systems,” each operating independently and without a hierarchy between them, risked producing precisely the kind of legal incoherence the Court of Appeal has now moved to foreclose (Dissenting Opinion, paras. 1, 12–13). Where Kohen argued from the law of treaties that the BIT’s arbitration clause was inapplicable from the moment of EU accession, the court arrives at the same destination through the public policy route. However, the geographical reach of the injunction reflects the same underlying concern that, without a structural response, the incompatibility with EU law would simply migrate to a different forum and persist indefinitely.

Conclusion

WCV v. Czech Republic reveals the institutional logic of the post-Achmea order. The Court of Appeal of The Hague has repositioned the national court as an active constitutional enforcer of the EU legal order. In doing so, it has also exposed the central paradox of the Achmea framework in operation: an investor who lost in arbitration sought a set-aside to try again, and a state that won counterclaimed for annulment to be rid of the structural risk; and the court granted both, while delivering neither party what it had initially sought. As of July 2026, no appeal to the Supreme Court of the Netherlands (Hoge Raad) appears to have been lodged, and it therefore remains to be seen whether the Supreme Court, if called upon, will endorse the full reach of this reasoning, particularly the extension of the injunction to non-EU tribunal seats. What is already clear is that national courts across the EU now have the template for doing considerably more than merely annulling awards. They can foreclose forum shopping that Achmea alone could never prevent.

Author

Beichen Ding is a PhD Candidate in Law at the World Trade Institute, University of Bern.

^[1]   The original judgment is in Dutch. All English translations are the author’s own, assisted by DeepL.