The Post-Achmea EU: Uncertainty in the Face of Change

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Author: Gabriel Anaya


On March 6, 2018, the Court of Justice of the European Union (CJEU) decided the landmark case of Slovak Republic v. Achmea BV. Achmea dealt with whether an intra-EU bilateral investment treaty (BIT) between the Netherlands and Slovak Republic could allow a contracting state to bring proceedings before an arbitral tribunal where the investment agreement was concluded before both states had acceded to the EU. The court found that BITs of this nature were incompatible with the Treaties of the European Union (TFEU), as they allowed member states to establish a mechanism for settling disputes between an investor and member state that can potentially lead to results incompatible with EU law, despite concerning its interpretation and application.[1] Specifically, the court held that the BIT’s dispute resolution provision had an adverse effect on the autonomy of EU law and that articles 267 and 344 of the TFEU preclude these types of provisions. Although not applicable to investment treaty tribunals, the judgment has provided a basis of incompatibility between BIT arbitral tribunals and EU law.

The future of intra-EU BITs–and any disputes arising out of them–has been thrown into question. Perhaps the most contested application has been in regards to the Energy Charter Treaty (ECT), a legally binding, multilateral energy agreement with dispute resolution provisions.[2] Soon after Achmea, Spain used the judgment to push back against various ECT-induced investor suits, claiming that the judgment made the ECT’s arbitration clause invalid.[3] On January 15, 2019, twenty-two EU member states, including Spain, agreed to terminate their intra-EU BITs, with twenty-one of those states declaring that Achmea is applicable to intra-EU investor-state arbitrations under the ECT.[4] However, five other EU states, Sweden, Finland, Slovenia, Malta, and Luxembourg, issued a separate declaration stating their belief that Achmea is silent on the investor-state dispute clause in the ECT, while Hungary took this silence to mean that it does not affect any current or future arbitration proceeding initiated under the ECT.[5] The scope of this decision’s applicability may be clarified after the resolution of Novenergia v Spain,[6] which is currently before the Svea Court of Appeal. In Novenergia, Spain has asked for a preliminary ruling on whether the ECT’s arbitral tribunal is compatible with EU law.[7]

In light of these reactions, Achmea could remove BIT arbitration altogether as a tool for investors to settle disputes with EU member states. This could potentially have many interesting outcomes. The European Council has already given a mandate to the European Commission to negotiate the establishment of a Multi-lateral Investment Court (MIC), a permanent body that could replace the traditional arbitration framework with a court system.[8] Further, Brexit could add another. Depending on the scope of Brexit’s outcome, investors in the UK could, in theory, enforce investor-state arbitrational awards against their EU counterparts, both at home and in the EU.[9] Similarly, we could see the UK become a sort of safe haven jurisdiction for EU companies wanting to make investments in other EU countries.[10] ECT awards, however, might not be so straight forward. Since the UK would still be part of the ECT as a manner of international law despite Brexit’s outcome, the aforementioned disagreement among member states regarding Achmea’s applicability to ECT arbitral disputes will likely cause more controversy.[11] Perhaps the proposed MIC, if successful, could find a way to include the UK in its jurisdiction, or perhaps another international tribunal could be created to deal with investment disputes that stem from the UK and EU member states.

In sum, the CJEU’s judgment in Achmea has put the traditional EU arbitration framework in a precarious position. Investor-state arbitration mechanisms are no longer a reliable tool for dispute resolution, meaning that traditional intra-EU BITs have been stripped of their teeth. Further, the disagreement between member states on just how broadly Achmea should be read has already created tensions in international agreements, which are likely to grow after the resolution of Novenergia. Achmea has already caused significant ripples in the EU landscape, but with Brexit in a state of limbo and the European Commission negotiating the MIC, the full effect of its ramifications is yet to be seen.



[1] Case C-284/16, Slovak Republic v. Achmea B.V., 2018 E.C.J. 158, ¶56.

[2] Summaries of EU Legislation, European Energy Charter (last updated Jan. 30, 2007),

[3] Sophia Morris, Spain Seeks to Dodge Investors’ Bid to Confirm €112M Award, Law360 (Jan. 2, 2019, 8:11 PM),; Caroline Simson, Spain Tees Up Energy Charter Treaty Arbitration Debate, Law360 (May 29, 2018, 6:51 PM),

[4] Tom Jones, EU Countries to Cancel BITs Post-Achmea, Global Arbitration Review (Jan. 17, 2019),

[5] Id.

[6] Set-aside proceeding in Svea Court of Appeal, Case No 4658-18, Novenergia II – Energy & Environment (SCA) (Grand Duchy of Luxembourg), SICAR vs the Kingdom of Spain, SCC Arbitration (2015/06).

[7] Laura Roddy, Spain Asks for ECJ to Rule on ECT, Global Arbitration Review (May 31, 2018),

[8] Council of the European Union Press Release 144/18, Multilateral Investment Court: Council Gives Mandate to the Commission to Open Negotiations (Mar. 20, 2018),

[9] Szilárd Gáspár-Szilágyi, Guest Post: Brexit. Maybe Not Such Bad News for intra-EU Investment Awards After Achmea?, International Economic Law and Policy Blog (Nov. 28, 2018, 9:14 PM),

[10] Richard Power, Brexit, the Energy Charter Treaty and Achmea: A Ray of Light?, Energy Voice (Jan. 2, 2019, 6:00 AM),

[11] Id.