The Termination of Intra-EU Investor-state Arbitration and the Enforceability of Intra-EU Awards in the United States District Courts

Abstract

Over the past 20 years, the gradual termination of ISDS mechanisms in intra-EU BITs and the ECT have received considerable attention within the EU. The CJEU judgments in Achmea, Komstroy and PL Holdings accelerated this termination process. This article aims to contribute to the debate.

After providing an assessment of how the EU anti-investment arbitration policy started and is gradually leading to a complete termination of intra-EU investment arbitration, the article analyses arbitral tribunals’ possible reaction to Komstroy. The article proposes that nothing suppresses tribunals of the jurisdiction to hear intra-EU disputes under Article 26 ECT and Kompetenz-Kompetenz. At the same time, the possibility for tribunals to render awards that are enforceable within the EU is seriously at stake. Aware of that, European investors are seeking enforcement of favourable intra-EU awards outside the EU. One of the preferred venues is the US District court for the District of Columbia which, however, has not yet taken a firm position on the matter. The article concludes that while arbitration under the intra-EU BITs is barely breathing, under the ECT investors should prefer the recourse to ICSID. In the final section, it discusses whether the enhanced protection of international investment law is still offered to European investors while investing in the EU.