The Energy Community Secretariat's Dispute Resolution and Negotiation Centre was established as a response to signals that the settlement alternatives currently available for energy disputes no longer respond to the needs of national authorities and stakeholders, in particular small and medium enterprises and consumers.
Pursuant to Procedural Act 2018/05-EnC, the Centre focuses on three pillars:
- facilitation of negotiations for the settlement of disputes between private parties, between private parties and states and/or their national authorities, and between states and/or their national authorities,
- facilitation for the swift closure of dispute settlement cases under the Energy Community Treaty, and
- negotiation support to national authorities in their negotiations with private parties.
The Centre is attached to the Legal Unit of the Secretariat and is chaired by Mr Dirk Buschle, the Head of the Legal Unit and Deputy Director of the Secretariat. The Secretariat, which has already facilitated negotiations in several high-profile investor-state disputes, will be supported by a group of distinguished individuals with experience in the areas covered by the Centre.
The services provided by the Secretariat's Dispute Resolution and Negotiation Centre are free of charge.
Centre and its activities
Written negotiations request
Written negotiations request
Any interested party, be it a government, public authority, market participant, civil society representative or investor, is invited to submit a request to have negotiations of a dispute facilitated by the Centre.
The request shall be made in writing and shall contain:
- the name and address of the disputing parties,
- a summary of the dispute (including any claims for damages),
- a presentation of any related pending proceedings, and
- any documents deemed necessary for the purposes of the negotiations.
Draft memorandum of understanding
Draft memorandum of understanding
Upon registration of the request, a draft memorandum of understanding together with a draft procedural timetable will be sent to all disputing parties. The draft memorandum of understanding shall contain information as to the place of the negotiations, confidentiality, effect of pending disputes and the name and role of the facilitator. The disputing parties will be free to agree upon amendments of the draft memorandum of understanding.
Parties to the dispute appoint a facilitator or mediator, either from the staff of the Energy Community Secretariat or the panel of mediators. All information exchanged during the negotiations remains strictly confidential.
Negotiations typically take place at the premises of the Energy Community Secretariat, which offers the use of its conference room and services and facilities in the centre of Vienna, free of charge.
Ideally, the negotiations will be completed over three months.
Dispute cases registry
The Centre runs a dispute registry on the cases submitted for negotiations. In line with the agreed confidentiality clauses, the dispute registry provides easily accessible basic information on each dispute, such as:
05.03.3021: 3rd Dispute Resolution Forum: 3rd webinar on the virtual unreality of dispute resolution the law
Join us for the third dispute resolution forum! Our third dispute resolution forum is an entirely online event – and our third webinar will focus on a hot topic: the virtual unreality of dispute resolution.
03.03.2021: 3rd Dispute Resolution Forum: 2nd webinar on Wind of change - how climate change shapes the law
Join us for the third dispute resolution forum! The second webinar takes us to the battle field. Can litigation save us from the imminent catastrophe of climate change and prove once and for all that states are responsible for climate hazards?
01.03.2021: 3rd Dispute Resolution Forum: 1st webinar on Renewable support schemes at cross-roads
|Join us for the third dispute resolution forum! Do you think you heard enough of renewables? Join our first webinar and think again: both the design of the support schemes and the jurisprudence are constantly changing.|
11.06.2020: Webinar training - Energy dispute resolution: Concepts and experience
|Dirk Buschle and Smaranda Miron ask when facing an energy dispute, what is the safest way towards favourable settlement: litigation, arbitration, mediation?|
19.09.2019: The second Energy Community Dispute Resolution Forum
|The second Energy Community Dispute Resolution Forum convened in September 2019 in Vienna, under the motto: “All is burning… The impact of climate change on dispute resolution.”|
17.04.2019: Coffee, Cake & Dispute Resolution Lecture
|This special lecture with the title: "Steering the ship - navigating through parallel arbitration, negotiation, mediation and court proceedings" by Ms Yas Banifatemi took place at the Secretariat in April 2019.|
27.09.2018: The first Dispute Resolution Forum
|The keynote speech by Mr Nikos Lavranos carried the title "The impact of the Achmea decision". Held in September 2018, the first Dispute Resolution Forum also provided in an update on resolution of energy regulation disputes and examined the role of regulators.|
Panel of Mediators
Whenever a mediation service is needed, the registrar notifies the panel of mediators and asks for their interest to serve as a mediator.
Dispute Resolution Review
Energy Community Dispute Resolution Review
On 3 June 2020, the Centre launched its new, biannual, online newsletter. Over the years, the Centre has developed quite a remarkable track record, paired with a growing insight into dispute resolution in the energy sectors. To share these insights and to encourage discussions among experts, the Centre reaches out to the public in organizing events and in its newsletter.
Should you wish to subscribe, please, write to us.
01/2020 Energy Community Dispute Resolution Review
Aechmea fasciata, the name comes from the Greek aichme (a spear).
The first issue features our analysis of investor-state dispute settlement post Achmea and the Singapore Convention on Mediation.
Compatibility of intra-EU BITs - Buschle / Miron article in the Croatian Arbitration Yearbook
The compatibility of intra-EU BITs with European law has been debated at large by academia, international arbitral tribunals and national courts. Dirk Buschle and Smaranda Miron analyse the opinion of the Advocate General in the case Slovak Republic v Achmea BV, in which it was found that found that an intra-EU BIT does not constitute discrimination on the basis of nationality and does not undermine the allocation of powers provided for under the EU Treaties and the autonomy of the EU legal system.
Their article was published in December 2017 in the Croatian Arbitration Yearbook.
World Abritration Café discusses Investor-State Disputes and ADR
On 25 February 2017, the Chair of the Dispute Resolution Centre of the Energy Community, Dr Dirk Buschle, attended the World Abritration Café, an event organised under the auspices of the Vienna Arbitration Days 2017. Dr Buschle moderated discussions on the topic of “Investor-State Disputes and ADR”. The debate was focused on the advantages of mediation over arbitration, especially in relation to energy disputes.
A report of the discussions can be found below.
Reference disputes and best practices
Keynote speech at the Energy Community Dispute Resolution Forum
During the First Dispute Resolution Forum, Nikos Lavranos delivered a keynote speech on the impact of the Achmea decision.
Ten years after the launch of the Achmea arbitration, the Court of Justice of the EU finally renders its ruling on the compatibility of bilateral investment treaty arbitration (BIT) and the legal order of the EU
The decision comes as a result of a request for a preliminary ruling from the German Federal Supreme Court (the BGH). The BGH inquired whether Article 344 TFEU precludes application of provisions in BITs which allow investors from European Member States to bring other Member States before arbitration tribunals, if the BIT had been signed before the accession of one of the Member States to the European Union, and arbitration proceedings were instituted only after both countries were part of the European Union; if the answer to the previous question is negative, whether Article 267 TFEU precludes the existence of such arbitration proceedings; and if the answers to both previous questions are negative, whether Article 18(1) TFEU precludes the existence of such arbitration proceedings.
The decision did not follow the opinion of the Advocate General issued on 19 September 2017, the conclusion of which was that EU law did not preclude the application of an investor-state dispute settlement mechanism established under an intra-EU BIT.
The Court of Justice first stated that an arbitral tribunal constituted under the BIT must rule on the basis of the law in force of the contracting state involved in the dispute as well as other (international) agreements between the contracting parties, which includes EU law. Next, the Court of Justice, unlike the Advocate General, finds that such an arbitral tribunal does not constitute a court or tribunal of a Member State within the meaning of Article 267 TFEU and, as a result, an arbitral tribunal cannot make a reference to the Court of Justice of the EU for a preliminary ruling. Lastly, the Court of Justice finds that, by concluding the BIT, the EU Member States parties to it established a mechanism for settling disputes between an investor and a Member State which could prevent those disputes from being solved in a manner that ensures the full effectiveness of EU law, even though they might concern the interpretation or application of that law. The Court of Justice concludes that the arbitration clause in the BIT is incompatible with EU law and that it has an adverse effect on the autonomy of EU law. The Court of Justice does not look into the issue of discrimination on the basis of nationality.
It remains to be seen what steps will the BGH take now and whether or not it will annul the Achmea award.
International Centre for Settlement of Investment Disputes: Eiser versus Spain On 4 May 2017, an ICSID tribunal chaired by John R. Crook (with co-arbitrators Stanimir Alexandrov and Campbell Alan Mc Lachlan) issued an award against Spain for rolling back certain incentives encouraging investment in the solar power sector. The tribunal found that the changes introduced to an existent feed-in tariff system in Spain amounted to the creation of a new system, very different from the one in reliance of which the solar power investors made the decision to invest. As such, the legislative changes undertaken by Spain constituted a breach of the fair and equitable treatment standard under the Energy Charter Treaty. The tribunal awarded damages and interest in the amount of EUR 128 million.
Flagship organisations, rules and guidelines
Vienna International Arbitral Centre, VIAC
Founded in 1975 as a department of the Austrian Federal Economic Chamber, VIAC has administered over 1,600 proceedings since its inception and is thereby one of the most experienced arbitration centers in the region. As of 2018, VIAC has taken over also administration of purely domestic disputes which had previously been vested with regional arbitration courts.
The United Nations Commission on International Trade Law, UNCITRAL
A legal body with universal membership specializing in commercial law reform worldwide for over 50 years, UNCITRAL's business is the modernization and harmonization of rules on international business. UNCITRAL formulates modern, fair, and harmonized rules on commercial transactionsis. It is best known for its model law on mediation.
The International Bar Association, IBA
Established in 1947, IBA was born out of the conviction that an organisation made up of the world's bar associations could contribute to global stability and peace through the administration of justice. The present membership is comprised of more than 80,000 individual international lawyers from most of the world’s leading law firms and some 190 bar associations and law societies spanning more than 170 countries. IBA Guidelines on Conflicts of Interest in International Arbitration sets out a series of general standards of independence and disclosure to govern the selection, appointment, and continuing role of an arbitrator.
- We are currently facilitating discussions between a group of small hydropower producers and the Albanian authorities, with regard to a new balancing mechanism in force since 1 April 2021 and its impact on the SHPPs.
- The Secretariat facilitated discussions between the Georgian subsidiary of the Czech energy company Energo-Pro and the Georgian authorities. The negotiations concerned the regulatory and commercial conditions for Energo-Pro to engage as universal service supplier on the electricity market in Georgia on the eve of its liberalization.
- In Moldova, the Centre has been involved in the determination and recognition of costs associated with technological consumption and technical losses in the gas distribution tariffs ANRE, the Moldovan regulator, and Moldovagaz, as holding company of the distribution companies in Moldova, requested the Centre to facilitate discussions on this matter and. To ensure a long-term solution, our team is currently supporting the Moldovan regulator in developing a new methodology for determining losses in gas distribution networks.
- Also in Moldova, we are facilitating negotiations between a private supplier and the national regulator on recognition of costs for financing the working capital.
- In the gas sector, the Secretariat, together with ACER, is conducting a public consultation between Energy Community Contracting Parties and EU Member States regarding the implementation of capacity allocation mechanisms at the borders between EU and Energy Community. The consultation was prompted by the fact that last summer Ukraine's gas grid operator GTSOU stated it would carry out maintenance at the Budince interconnection point on the border with Slovakia, leading to physical flows coming to a total halt. Budince is the entry point for gas from Europe to flow into Ukraine via Slovakia, and the maintenance works affected traders who bought gas to store in Ukraine over the summer. This situation could have been avoided if Slovakia applied EU network codes on the border with Ukraine. In practical terms, applying EU network codes would oblige Slovakia to maximise capacities and offer them on open auction platforms as is currently the practice for all EU member states.
The consultation focuses on capacity offering and use and aims at reaching a better understanding of market needs, approaches to avoid network interruptions and optimise capacity availability at gas interconnectors between the EU and the Energy Community and within the Energy Community.