On March 16, 2026, Iceland formally notified its withdrawal from the Energy Charter Treaty (ECT), citing the need to align its international obligations with its 2030 climate-neutrality goals. According to the Energy Charter Secretariat, the withdrawal takes effect on March 17, 2027. Despite withdrawing, Iceland remains bound by the ECT’s 20-year sunset clause, which preserves protections for existing investments. Iceland’s exit highlights the ‘legal lock‑in’ effect of older investment treaties: even after withdrawal, states remain exposed to claims that may undermine climate‑transition measures. This underscores the importance of coordinated treaty‑neutralization strategies to close the sunset‑clause gap. Indeed, IISD has recommended inter se agreements among withdrawing states to neutralise this residual litigation risk.