Europe

European Union (EU) member states have signed over 1300 investment treaties with third countries, in addition to some 200 between EU members. Non-EU European states are party to over 500 treaties. Most of these contain investor-state dispute settlement (ISDS) provisions, which enable foreign corporations to take ISDS claims against states if they deem their profits or potential investment to be affected by new laws or changes in policy.

The EU has ratified four agreements with an ISDS mechanism: the Energy Charter Treaty (ECT), to which 53 European and Central Asian countries are party, the Comprehensive Economic Trade Agreement (CETA) with Canada, and agreements with Vietnam and Singapore. Only the ECT has been fully in force. The ISDS provisions in the three others will be implemented after all member states have ratified them.

These three deals also include a revised ISDS mechanism created by the European Commission, known as the investment court system. Many critics say that this new system is largely window-dressing and does not address the core of the problem behind investor-state dispute measures.

In 2015, the European Commission asked the EU member states to terminate their intra-EU bilateral investment treaties (BITs), arguing they are incompatible with EU law, which was confirmed by the Court of Justice of the European Union in its “Achmea” decision.

As of April 2020, the number of intra-EU ISDS disputes amounted to 170, approximately 17% of all cases globally, 76 of which having been brought under the ECT.

Overall investors from European countries have initiated over 600 ISDS cases, half of which are against non-European states. European countries have been targeted in about 350 cases. Grouped together, investors from EU member states have launched the majority of total disputes (over 400).

Spain, the Czech Republic, Poland, Russia and Ukraine have been among the ten most frequent respondent states, while the Netherlands, the United Kingdom, Germany, Spain, France, Luxembourg, Italy and Switzerland have been among the ten most frequent home states of the investor.

The most well-known cases include:

Yukos (Isle of Man) vs. Russia: US$50 billion awarded in 2014 to majority shareholders of the oil and gas company (ECT invoked).

Eureko (Netherland) vs. Poland: case settled in 2005 for about €2 billion in favour of the investor, a large European insurance company (Netherland-Poland BIT invoked).

Ceskoslovenska Obchodni Banka (Czech Republic) vs. Slovak Republic: €553 million awarded in 2004 to the investor, one of the largest commercial banks in the Czech Republic (Czech Republic-Slovak Republic BIT invoked).

Photo: War on Want

(April 2020)

SOMO | 15-Nov-2023
German energy company RWE has announced its intention to withdraw its international arbitration proceedings against the Dutch state at the International Centre for Settlement of Investment Disputes.
ImpACT International | 13-Nov-2023
Removing ISDS mechanisms within the CPTPP is a good start, but Britain must protect itself and other nations from its own corporate interests by removing all ISDS mechanisms.
Mint | 3-Nov-2023
India and UK seem to have moved towards common ground on dispute settlement, which was the most controversial part of the bilateral investment treaty.
Euromaidan Press | 3-Nov-2023
DTEK Group prevails in The Hague case, securing a $267 million award from Russia for the confiscation of assets in occupied Crimea.
MSN | 3-Nov-2023
The Russian state will go on trial for failing to pay $60bn (£49bn) to former shareholders of defunct oil behemoth Yukos, after a British judge blocked the country’s bid for immunity.
CIAR Global | 27-Oct-2023
Klesch Group Holdings, grupo inversor internacional de materias primas industriales dedicado a la producción de petróleo y metales, ha presentado tres demandas de arbitraje de inversiones. Los procedimientos invocan el Tratado de la Carta de la Energía (TCE) y se registran contra la Unión Europea, Alemania y Dinamarca.
CIAR Global | 25-Oct-2023
La demanda de arbitraje de inversiones en el sector de las renovables contra España, encabezada por el inversor alemán Mathias Kruck, se ha resuelto con un laudo que concede una indemnización de algo más de 15 millones de euros de los 67,40 millones que reclamaban.
The Hindu BusinessLine | 25-Oct-2023
Full-throttle efforts are being made to ensure India-UK FTA and BIT, get finalised simultaneously.
Global Justice Now | 25-Oct-2023
The UK faces “huge financial risk” of lawsuits if the Pacific trade deal is not amended, warn civil society organisations and academics in a joint letter published today.
Inside Climate News | 24-Oct-2023
An obscure but far-reaching system allowing corporations to sue governments is being “weaponized” by the fossil fuel and mining industries, according to a new UN report, jeopardizing progress in developing nations.