After Achmea: Maintaining the EU Law Compatibility of Intra-EU BITs Through Treaty Interpretation

Abstract

Following the CJEU’S preliminary ruling in Achmea, the Netherlands announced on 26 April 2018 its intention to terminate all intra-EU BITs, on the basis that termination is the only available option. This article takes issue with that proposition by assessing the Achmea ruling and its effects from the perspective of treaty interpretation under customary rules of international law. It notes how the analysis from the CJEU failed to interpret the Netherlands-Slovakia bit in accordance with the VCLT, especially by not departing from the presumption against the incompatibility of the bit with EU law. This article also argues how and why joint interpretations by parties to intra-EU BITs, as authentic expressions of their common understanding, may constitute an effective alternative to termination or amendment of intra-EU bits in the wake of the Achmea judgment. In fact, this is a solution that was already applied by the European Commission in 2003 in relation to the bits of the eight (then) accession or candidate states (all now EU Member States) with the United States. Furthermore, this could potentially constitute another option for policy-makers so as to maintain compatibility of intra-EU BITs with EU law, as well as other international agreements between Member States equipped with dispute settlement mechanisms, through treaty interpretation.