With negotiators preparing for the seventh round of Energy Charter Treaty (ECT) modernization talks with no signs of tangible progress, the continued emergence of new investor-state disputes under the controversial agreement has highlighted the risks the treaty poses for states as they phase out fossil fuels. Of all fossil fuels, coal has the greatest climate […]
Introduction The Energy Charter Treaty (ECT) faces criticism for its outdated investment provisions and the threats it poses to the energy transition. ISDS claims brought pursuant to the ECT by fossil fuel investors demonstrate that these threats are imminent and real. Moreover, they are likely to increase as governments take more ambitious climate action. Most […]
Outlook for the EU-China Comprehensive Agreement on Investment Unclear, as EU Parliament Votes to Suspend Ratification Efforts
On May 20, 2021, the European Parliament voted to suspend ratification efforts of the “in principle” Comprehensive Agreement on Investment (CAI) with China.
The uncertain future of the Energy Charter Treaty: Belgium asks the European Court of Justice to rule on the compatibility of the modernized ECT with EU law
The relationship between the ECT and EU law is characterized by complexity and legal uncertainty, especially as far Article 26, the ECT’s dispute settlement mechanism and its application in an intra-EU setting is concerned. This article examines the question of whether the Achmea judgment’s finding on the incompatibility of intra-EU investment arbitration under BITs also affects the dispute settlement mechanism under the ECT
Progress report on ECT modernization negotiations indicates familiar divisions among delegations as push for EU withdrawal grows
Following three negotiation rounds on ECT modernization last year, the most recent of which concluded on November 6, 2020, a leaked progress report from December 2020 suggests that state parties are still divided on key issues. This makes progress in negotiations, which require consensus from the national delegations, difficult to come by.
On December 30, 2020, after seven years of discussion, Brussels and Beijing announced the conclusion of the negotiations for an “in principle” Comprehensive Agreement on Investment (CAI) between China and the European Union.
CETA Investment Court System advances toward implementation while Irish activists launch campaign opposing ratification
Four decisions adopted by Canada and the European Union on January 29 have moved the parties closer to implementing an Investment Court System (ICS) under the Canada-EU Comprehensive Economic and Trade Agreement (CETA). The decisions on appeals, interpretation, code of conduct, and mediation were formally endorsed by CETA’s Joint Committee and Committee on Services and Investment (CSI) and will take effect once the dispute resolution provision of CETA comes into force.
One of the most striking trends in investment policy over the past decade has been the increased use of investment screening as a policy tool, particularly in developed economies, with the issue becoming more salient with the advent of the COVID-19 pandemic. This article provides an overview of these developments.
The EU’s foreign investment screening mechanisms became operational on October 11, 2020. As we’ve reported, guidance on the screening mechanisms, which are implemented by individual member states, was released in March 2020 following the 2019 entry into force of the FDI Screening Regulation.
EC suggests withdrawal is a possibility as Energy Charter Treaty modernization negotiations continue
On December 2, 2020, in an answer to questions submitted by MEPs, the EC suggested that the EU could exit the ECT.
Side-stepping national courts would be a big step backwards for Europe: A reaction to the EC’s public consultation on EU cross-border investment.
The European Commission has launched a public consultation initiative on the EU’s current system of investment protection and facilitation, prompted by the recent termination of BITs between the member states. In this piece, the authors caution that new forms of international investment protection are not necessary and could serve to undermine the legitimacy of the EU.
On July 31, 2020, the Cypriot parliament voted against the ratification of CETA, the trade deal between the EU and Canada.
As we reported, the EC launched a consultation to clarify and supplement rules on cross-border investment within the EU in May 2020.
On May 26 2020, the EC launched a consultation to clarify and supplement rules on cross-border investment within the EU. According to the consultation document released by the EC, the EU currently faces a growing need for private investment – both for its efforts to mitigate climate change and remain competitive in an increasing digital […]
On March 25, 2020, the European Commission published a guidance for member states on FDI screening in the face of the COVID-19 pandemic, focusing on, but not limited to, health-related industries.
The EU released a proposal for the modernization of the ECT on May 27, 2020. This latest draft of the EU’s proposal includes changes to the treaty’s definition of investment, an affirmation of parties’ right to regulate, a narrower definition of FET, and reference to a multilateral investment court. The proposal also suggests several additional articles on sustainable development, frivolous claims, security for costs, interventions by third parties, third-party funding, and valuation of damages.
EU Member States Sign Agreement to Terminate Intra-EU BITs While German Investor Brings Claim Against the Netherlands Under the ECT
On May 5, 2020, 23 European Union member states* formally agreed to the termination of intra-EU BITs.
Theodoros Adamakopoulos and others v. Republic of Cyprus, ICSID Case No. ARB/15/49
The talks between China and the EU for a Comprehensive Agreement on Investment saw an important milestone in December 2019, as the two sides exchanged new market access offers. They had exchanged market access offers once previously, in July 2018.
The United Kingdom’s exit from the EU formally took place on January 31, 2020, following years of talks and repeated extensions in the Brexit deadline. With the United Kingdom now in an 11-month transition period, questions remain over the shape of the country’s future trade and investment relationship with the EU and other partners, though some further indications of what this may entail are beginning to emerge.
The idea of entrusting party-appointed arbitrators with powers to decide investor–state disputes through final and binding awards, inherited from commercial arbitration and traditionally accepted as appropriate, now causes discomfort among critics.
Talks for an EU–China BIT have made some progress in the areas of financial services and national treatment, according to a report circulated by the European Commission in July, with another negotiating round planned for the week of September 23.
The European Council has approved negotiating directives for the EU’s participation in talks to modernize the ECT, confirming its decision during a meeting on July 2, 2019.
The EC released on May 14 a set of draft negotiating directives setting out its proposed approach in “modernizing” the Energy Charter Treaty (ECT).
The CJEU has deemed that the ICS included in the Canada–EU CETA is consistent with EU law, issuing its final opinion on April 30, 2019.
Leaders from China and the EU have pledged to finalize negotiations for their Comprehensive Investment Agreement next year, announcing their target date and further details about the process during a summit in Brussels, Belgium, on April 9, 2019.
Twenty-two EU member states endorsed a political declaration on January 15, 2019, where they announced a series of actions involving existing intra-EU BITs and upcoming or ongoing investment arbitration.
The European Economic and Social Committee (EESC) has weighed in on the European Commission’s recommendation for a European Council decision to launch negotiations on the proposed MIC, supporting discussions on ISDS reform while noting areas for improvement.
CJEU Advocate General Yves Bot issued a non-binding opinion on January 29, 2019, deeming that the ICS included in the Canada–EU CETA is compatible with EU law. Bot assessed the ICS against the EU Treaty, the TFEU and the EU Charter of Fundamental Rights.
The European Union’s new framework for screening FDI is due to take effect in April 2019, with the text now published in the EU’s Official Journal. The framework allows both EU member states and the European Commission until October 2020 to enact the changes required.
Delegates had a new round of deliberations for multilateral reform of ISDS at UNCITRAL from April 1 to 5. The meeting of Working Group III, which is tasked with this process, was held in New York.
On November 20, 2018, the European Parliament, Council and Commission reached political agreement on an EU framework for screening FDI, and on December 11, 2018, the International Trade Committee of the European Parliament endorsed the political agreement.
European Union signs trade and investment agreements with Singapore; EU–Japan EPA to enter into force on February 2019
On October 19, 2018, Singapore and the European Union signed political and trade agreements as well as the EU–Singapore Investment Protection Agreement (IPA).
European Commission communication on protection of intra-EU investment rejects ECT as a basis for intra-EU ISDS
On July 19, 2018, the European Commission (EC) published a communication to the European Parliament and the Council of the European Union (EU) titled Protection of Intra-EU Investment.
On July 17, 2018, EC President Jean-Claude Juncker and Japanese Prime Minister Shinzo Abe signed the Japan–European Union (EU) Economic Partnership Agreement (JEEPA).
MASDAR SOLAR & WIND COOPERATIEF U.A. V. THE KINGDOM OF SPAIN, ICSID CASE NO. ARB/14/1
Current and future investment treaties and chapters involving EU member states or the Union itself may be profoundly impacted by a landmark ruling of the European Court of Justice (ECJ). In this piece, the author explores the judgement from an EU constitutional point of view and analyzes potential consequences. Did the Achmea ruling come as a surprise to EU law insiders?
Council of the European Union adopts negotiating directives: EU Commission to negotiate a convention establishing a multilateral investment court
On March 20, 2018, the Council of the European Union adopted negotiating directives authorizing the European Commission to negotiate a convention establishing a multilateral court for the settlement of investment disputes.
On December 8, 2017, European Commission President Jean-Claude Juncker and Japanese Prime Minister Shinzo Abe announced the finalization of the negotiations of the Economic Partnership Agreement (EPA) between the European Union and Japan.
Beyond advancing its Investment Court System (ICS) proposal in bilateral negotiations, the European Union continues its efforts toward establishing a multilateral investment court (MIC).
On September 6, 2017, Belgium submitted to the Court of Justice of the European Union (CJEU) a request for an opinion on the compatibility of the ICS with the European Treaties.
On July 31, 2017 the European Commission launched a consultation on the prevention and amicable resolution of disputes between investors and public authorities within the European Union.
After Canada’s ratification of the Comprehensive Economic and Trade Agreement (CETA) on May 17, 2017, Canada and the European Commission agreed to start the provisional application of the agreement on September 21, 2017.
The European Union and Japan announced on July 6, 2017 that they reached an agreement in principle on the main elements of an Economic Partnership Agreement (EPA).
In theory, the common European market works based on principles that protect intra-EU cross-border investments. In practice, can these principles be reconciled with dozens of intra-EU BIT still in place?
In September 2014, the European Commission refused to register a petition signed by over three million EU citizens requesting the Commission to stop trade and investment negotiations with the United States and refrain from concluding the CETA with Canada.
The European Court of Justice published its Opinion 2/15 on the European Union–Singapore FTA on May 16, 2017.
Can the European Union act alone in concluding agreements such as CETA and the EU–Singapore FTA? Or must EU member states also ratify them? ECJ Advocate General Sharpston discusses the allocation of powers in the field of investment under EU law.
On February 15, 2017, the European Parliament approved the Comprehensive Economic and Trade Agreement (CETA), signed by Canada and the European Union on October 30, 2016 after seven years of negotiations. The agreement was approved by 408 Members of the European Parliament and rejected by 254, with 33 abstentions. As reported in ITN, this approval paves the […]
On December 13 and 14, 2016, the European Commission and the Canadian Government co-hosted exploratory discussions on establishing a multilateral investment court. Government representatives from several countries attended the closed-door meeting in Geneva. Upon concluding CETA, the two hosts had vowed to “work expeditiously” to create a permanent investment court, building on the ICS mechanism included in the agreement. The goal of […]