Taking Investors’ Rights Seriously: The Achmea and CETA Rulings of the European Court of Justice Do Not Bar Intra-EU Investment Arbitration
In its recent Achmea and CETA rulings the European Court of Justice (ECJ) has addressed aspects of the much debated compatibility of intra-European Union (EU) investment arbitration with EU law. Both rulings were concerned with internal EU governance issues. In contrast, the rulings did not address the rights of private investors who had made investments in reliance on the relevant investment treaties. This absence of consideration of investors’ rights may surprise as the protection of their position is at the heart of investment treaties. The article submits that such lack of consideration for the investors is both a result of the confines of the compatibility debate conducted so far, and a result of the procedural limitations of the relevant ECJ proceedings.
Against this background, the article analyzes how investors’ rights im-pact the legality of intra-EU investment arbitration. It argues that investors’ rights need to be taken seriously, and all the more so as it would be contradictory if state parties to investment treaties which have bestowed such rights on investors so as to solicit their privately financed investments would be allowed subsequently to renege on their commitments, in particular where investments have been made. The argument is based on public international law and the binding effects which public international law has within the EU. Correspondingly, the EU must not obstruct the enforcement of investors’ rights. A violation of that obligation by EU institutions constitutes an Energy Charter Treaty (ECT) infringement in itself. In addition, the article undertakes to demonstrate that the two ECJ rulings lack precedent character for the described impact of investors’ rights on the legal assessment. Alternatively, the article discusses how intra-EU arbitration under the multilateral Energy Charter Treaty is to be assessed if, contrary to the above, investors’ rights were to be disregarded and the analysis to be confined to the criteria selected by the ECJ to arrive at its two rulings. It submits that even under the criteria developed by said rulings, EU law does not restrict intra-EU investment arbitration under the ECT.