The Intra-EU Investment Dispute Settlement After Achmea: Towards an Integrated Model of Justice

Abstract

The Achmea judgment marks the culmination of the systemic conflict between international legal system and EU legal system on international investment arbitration. The Court referred to the fundamental principles of autonomy, effectiveness, prevalence and direct effect of EU law, as well as the principle of fair cooperation between Member States and ruled that arbitration clause laid down in intra-EU BITs is incompatible with EU law. As a result, the primaute of European law seems to reserve to the CJEU the role of last authoritative institution for the interpretation and application of all EU law and totally exclude the potestas iudicandi of arbitral tribunals in investment disputes. The paper discusses Achmea’s consequences on the relationship between international and European legal order in intra-EU investment dispute settlement. After a general overview of the substantial and procedural framework of investors’ protection, the paper deals with jurisdictional issues in ISDS system before and after Achmea. It reviews all possible scenarios on arbitration proceedings by analyzing the past and the future of arbitrators’ jurisdiction in the European legal order. It considers the most recent developments in EU legal order, specifically the agreement between Member States on a plurilateral treaty for the termination of all intra-EU BITs. The focus is on the ubi consistam of EU law in international legal order and on how courts could cooperate for an integrated model of justice. The analysis of the current status quo of the ISDS will show that the lack of judicial communication between international courts affects the efficiency of investment arbitration, and specifically, about intra-EU issues, the absence of a mechanism which would allow to settle investment dispute in accordance with EU judicial order. The final part of the paper explores the attempts to reconcile the dispute resolution mechanism provided by investment treaties with the European jurisdictional framework, despite it was defined by the ECJ as “a complete system of legal remedies and procedures designed to ensure review of the legality of acts of the institutions”. Proposals for reforms of investor-State dispute settlement system could follow three different approaches (systemic, based on cross-fertilization communication techniques and integralist) in order to restate the relationship between private and public justice: which future for investment dispute settlement system after Achmea?