Is There an Alternative to Intra-European Bilateral Investment Treaties Framework under European Law?

Abstract

In order to facilitate trade, bilateral investment treaties create a favourable framework for the promotion and protection of foreign investment. The core guarantees present in most bilateral investment treaties include national and most-favoured nation treatment, fair and equitable treatment, free transfer of funds, protection against expropriation and an international dispute settlement mechanism. In the light of the problematic status of intra-European Union bilateral investment treaties, the purpose of this article is to assess whether there is a viable alternative under the European law comparable to the protection of investments given in BITs among member states of the European Union.Common standards of European law offer similar protection in terms of guarantees for free transfer of capital and protection against expropriation. National and most-favoured nation treatment, which are replicated by the EU principle of non-discrimination, has even broader ambit, providing investors with higher safeguards on pre-entry stage of investments. EU law does not contain the same forms of protection, which are covered by fair and equitable treatment clauses in BITs. Nonetheless, EU law does embrace some features attributed to the protection under fair and equitable treatment through the application of omnipresent principles of European law. National court systems of the European Union may not be able to offer competitive procedure of asserting investment claims. Therefore, submission to the national courts instead of arbitration tribunals remains the most contentious difference between BITs and EU law. In relation to this, establishment of a specialised European court dealing with international investment claims is proposed.