Policy & Regulation

Energy Charter Treaty faces test after court ruling

The European Commission has increased pressure on EU member states to terminate bilateral investment treaties, which could lead to weaker investor protection under the Energy Charter Treaty The European Commission has increased pressure on EU member states to terminate bilateral investment treaties, which could lead to weaker investor protection under the Energy Charter Treaty.
By Andreas Walstad 6 August 2018 0 32021
The European Court of Justice building in Luxembourg. (ECJ)

A ruling by the European Court of Justice (ECJ) has raised concerns that the role of the Energy Charter Treaty (ECT) will be weakened, potentially leaving European energy companies with less investor protection than before.

Under the so-called Achmea judgment in March, the ECJ ruled arbitration based on the bilateral investment treaty between the Netherlands, Slovakia and the Czech Republic is incompatible with EU law and the Treaty of the Functioning of the EU (TFEU).

The court’s decision could have repercussions for other bilateral...