Jurisdiction of Tribunals to Settle Intra-EU Investment Treaty Disputes

The European Court of Justice (ECJ) made a ground-breaking shift away from the current system of investor–State dispute settlement (ISDS) by rendering its judgment in the matter of Achmea v Slovak Republic. However, since March 2018, a large and ever-growing number of investment tribunals have found that the Achmea judgment does not deprive them of arbitral jurisdiction. Against this background, the aim of the present article is to analyse the effects of the Achmea judgment on the jurisdiction of tribunals to settle intra-European Union (EU) investment treaty disputes. By taking due account of the reasoning conducted by the ECJ, the scope of the Achmea jurisprudence will be clarified. It is concluded that the incompatibility of intra-EU ISDS with EU law concerns all intra-EU investment treaties, including article 26 of the Energy Charter Treaty (ECT). On this basis, we ask whether, and to what extent, the applicability of the Achmea judgment is relevant to arbitral jurisdiction. Considering the law applicable to the arbitration agreement, we conclude that International Centre for Settlement of Investment Disputes (ICSID) tribunals and those seated outside the EU remain competent to settle intra-EU investment disputes. In contrast, the Achmea judgment renders ISDS clauses contained in intra-EU investment treaties inoperable if the tribunal is seated within the EU. The article closes with an outlook that puts these conclusions into perspective by considering recent developments such as the EU Member States’ ratification of a multilateral termination treaty.