No full-text available
To read the full-text of this research,
you can request a copy directly from the author.
The Last Bite of the BITs—Supremacy of EU Law versus Investment Treaty Arbitration
Abstract
According to Article 267 TFEU, national courts of the EU Member States can (and sometimes must) ask for a preliminary ruling from the Court of Justice on the interpretation and application of Community law, including international treaties and recommendations, and on the validity of Community secondary legislation. In this way, it is ensured that EU citizens are treated equally throughout the Union. However, this is not applicable when it comes to arbitral proceedings, be they commercial or investment arbitrations. The Court does not accept references for preliminary rulings from arbitral tribunals. For this reason, respondent states in international arbitral proceedings have argued that arbitration and EU law are utterly incompatible. In their submissions as respondents in arbitral proceedings, EU Member States have argued that, as a result of EU accession, bilateral investment treaties (BITs) have been automatically terminated. In subsidiary, they sometimes claim that, due to their incompatibility with EU law, BITs cannot apply. But if BITs are not applicable anymore, there are few remedies left for investors within the EU.
... Before the entry into force of the Treaty of Lisbon, the EU had shared-but not exclusivecompetence in international investment matters, as none of the treaty provisions, from the foundation of the EU, covered international investment. Lisbon was the first treaty to include international investment, in the form of exclusive competence for FDI at the EU level (Miron 2014). 8 Shan and Zhang (2010) record that ''While it is clear that FDI is included in the CCP (Common Commercial Policy), there is no definition of the term 'foreign direct investment', nor is there any clarification of the exact scope of FDI under the CCP.'' ...
... 19 That is, beyond most-favoured-nation (MFN) treatment, the EU and China both now being members of WTO. 20 See Miron (2014). 21 The WTO Agreement contains a further set of more recent agreements relevant to FDI, and therefore the IIA will concern issues in connection with these. ...
In light of the growing trade flow, the investment relationship between European Union (EU) and China needs to be revisited. Chinese firms face significant barriers in entering and operating in the European market whilst the European economy needs investment. Support for investment may be crucial for both EU and China to improve economic growth. The prospective International Investment Agreement (IIA) seeks to achieve this goal. This paper focuses on Chinese inward Foreign Direct Investment (FDI) into the EU and on the potential for generating greater mutual EU-China flows, improved market access and investor protection under the IIA.
... The two contracting parties reach a consensus through an exchange of letters on the termination of the BIT. In the second step, the contracting parties mutually agree that the survival clause is no longer applicable (Miron, 2014). In addition, as mentioned above, EU clearly states that the termination of the intra-EU BITs will terminate the survival clauses at the same time. ...
The figure of amicus curiae is a central feature of contemporary
investor-state arbitration law and practice. Over the last several years
the European Commission has taken part in a number of arbitral
proceedings that touched upon matters of European Union Law. This
phenomenon is part of the European Union’s broader incursion into the
realm of investment law. The participation of an entity with legislative
and political functions in investment arbitrations raises complex
questions regarding the nature of the interests that this entity pursues
and the potential impact that its involvement might have in the dispute
settlement mechanism. This paper examines the participation of the
European Commission (EC) in investor-state arbitrations and assesses
its impact in the overall mechanism of investor-state dispute resolution.
It is argued that the EC is fundamentally a distinct type of amicus, as it
pursues interests different from those of traditional amici, and should
therefore be accorded extended participatory rights.
This article focuses on recent developments with regard to the mechanisms for international dispute settlement which the EU has accepted or in some instances promoted, or which in any case are of direct relevance for the EU. As a preliminary question, the case law of the European Court of Justice concerning the compatibility of international dispute settlement mechanisms will be analysed. The article then provides an overview of such mechanisms included in multilateral and bilateral agreements concluded by the EU, with a particular emphasis on recent bilateral trade and cooperation agreements. The last parts of the article look at specific institutional problems such as the question of the representation of the EU before international dispute settlement mechanisms, and the special challenges posed by investment disputes and, in this context, investor-to-state dispute settlement (ISDS), including ISDS mechanisms in bilateral investment agreements concluded between the EU Member States.
The European Court of Justice's (ECJ's) jurisprudence of fundamental rights in cases such as Schmidberger and Omega extends the court's jurisdiction in ways that compete with that of Member States in matters of visceral concern. And just as the Member States require a guarantee that the ECJ respect fundamental rights rooted in national tradition, so the ECJ insists that international organisations respect rights constitutive of the EU. The demand of such guarantees reproduces between the ECJ and the international order the kinds of conflicting jurisdictional claims that have shadowed the relation between the ECJ and the courts of the Member States. This article argues that the clash of jurisdiction is being resolved by the formation of a novel order of coordinate constitutionalism in which Member States, the ECJ, the European Court of Human Rights and other international tribunals or organisations agree to defer to one another's decisions, provided those decisions respect mutually agreed essentials. This coordinate order extends constitutionalism beyond its home territory in the nation state through a jurisprudence of mutual monitoring and peer review that carefully builds on national constitutional traditions, but does not create a new, encompassing sovereign entity. The doctrinal instruments by which the plural constitutional orders are, in this way, profoundly linked without being integrated are variants of the familiar Solange principles of the German Constitutional Court, by which each legal order accepts the decisions of the others, even if another decision would have been more consistent with the national constitution tradition, ‘so long as’ those decisions do not systematically violate its own understanding of constitutional essentials. The article presents the coordinate constitutional order being created by this broad application of the Solange doctrine as an instance, and practical development, of what Rawls called an overlapping consensus: agreement on fundamental commitments of principle—those essentials which each order requires the others to respect—does not rest on mutual agreement on any single, comprehensive moral doctrine embracing ideas of human dignity, individuality or the like. It is precisely because the actors of each order acknowledge these persistent differences, and their continuing influence on the interpretation of shared commitments in particular conflicts, that they reserve the right to interpret essential principles, within broad and shared limits, and accord this right to others. The embrace of variants of the Solange principles by many coordinate courts, in obligating each to monitor the others' respect for essentials, creates an institutional mechanism for articulating and adjusting the practical meaning of the overlapping consensus.