Vattenfall in the Aftermath of Achmea: Between a Rock and a Hard Place?

On 6 March 2018, the Court of Justice of the European Union (CJEU) issued its judgment in the case between Slovakia v. Achmea BV (Case C-284/16). The CJEU ruled that the investor-state dispute settlement (ISDS) provisions in the Netherlands-Slovakia bilateral investment treaty are incompatible with the principle of autonomy of EU law. This addressed a highly controversial issue that has been lingering for years: whether bilateral investment treaties (BITS) concluded between EU Member States are compatible with EU law. The judgment has caused controversy amongst scholars and international practitioners, and its significance is undeniable. Yet, the judgment has led to many unanswered questions, including, inter alia, what EU law requires of arbitral tribunals in such cases, how the seat of the arbitration tribunal may affect the outcome of the above judgement and whether the outcome of the judgement is limited to intra-EU BITS. This Article will reflect on these open issues and will endeavour to respond such issues by examining the application of the above ruling in the context of the case Vattenfall AB and others v. Federal Republic of Germany (II) (ICSID Case No. ARB/12/12) as well as other recent investment arbitration decisions.