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Table of Contents: I. Introduction – II. The content of Opinion 1/17 – II.1. Compliance of the investment court system framed in CETA with the principle of autonomy of the EU legal order – II.2. Compliance of the investment court system framed in CETA with the right of access to an independent tribunal – III. Assessing the compatibility of first-generation extra-EU BITs with EU law in light of Opinion 1/17 – III.1. Non-compliance of the ISDS mechanism of first-generation BITs with the principle of autonomy of the EU legal order – III.2. The irrelevance of the right of access to an independent and impartial tribunal regarding the ISDS mechanism of first-generation BITs – IV. Consequences of the incompatibility of first-generation BITs with EU law – IV.1. The obligation of Member States to remedy incompatibilities with EU law – IV.2. Avenues to challenge the compatibility of first-generation extra-EU BITs with EU law – V. Conclusion
Abstract: This Article draws on recent developments to broaden the focus currently placed on the ECT to other existing bilateral investment treaties (BITs). More precisely, it proposes an analysis of first-generation extra-EU BITs in light of the legal test developed by the Court of Justice of the European Union in 2019 in Opinion 1/17, in which it examined the investor-State dispute settlement (ISDS) mechanism provided for in the CETA investment chapter. As these treaties generally lack the provisions that enabled the Court to declare the CETA’s ISDS mechanism compatible with EU law, they may be found to breach EU law. In accordance with art. 352 TFEU, Member States must rectify any inconsistencies between existing extra-EU BITs to which they are parties to and EU law. Nevertheless, though options for challenging the compatibility of treaties that have not been brought into line with EU law are rather limited, the Court’s case-law may allow Member States involved in ISDS and/or enforcement or annulment proceedings based on such a BIT to argue, on the basis of Opinion 1/17, that the underlying BIT is contrary to EU law.
Keywords: first-generation bilateral investment treaties – Energy Charter Treaty – investor-State dispute settlement – Opinion 1/17 – autonomy of the EU legal order – art. 351 TFEU.
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European Papers, Vol. 9, 2024, No 3, pp. 910-929
ISSN 2499-8249 - doi: 10.15166/2499-8249/791
* Associate, Baldon Avocats, Paris, nbraoudakis@baldon-avocats.com.
** PhD Researcher, Paris 1 Panthéon-Sorbonne University, rcraveia@baldon-avocats.com.
