This page provides an overview of the Energy Community Dispute Resolution and Negotiation Centre's activities, including ongoing cases. It also highlights a number of reference energy disputes cases.
Dispute 06/2017: Albania Parties involved Albania Areas of work Electricity Short description
The Energy Community Secretariat is involved in negotiation process between two market participants in Albania aiming at finding a feasible and long-lasting solution to a dispute brought to Secretariat’s attention earlier this year.
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. Download case summary
News from the DRN Centre
News from the Dispute Resolution Centre
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.
Download the article
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 in the topic “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.
Download the discussion report