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Convergences and Divergences of Commercial and Investment Arbitration Under Achmea (C-284/16)

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Abstract

The Achmea judgement reveals the existence of a competing logic between the principle of autonomy of EU Law and the autonomy of the mechanisms of dispute settlement through arbitration. In this regard, the ECJ has treated investment treaty arbitration and commercial arbitration separately. A full coherence of such a division seems impossible to achieve. This chapter argues that there are several possible paths of analysis of Achmea case’s impact on the future development of commercial arbitration as an element of the EU judicial system in the context of investment arbitration. In this sense, the judgement exercises a twofold influence over commercial arbitration. On the one hand, it reexamines the connection of commercial arbitration with EU law. On the other hand, it shows a potential of commercial arbitration and its growing value compared to other dispute settlement mechanisms, like investment arbitration.

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Notes

  1. 1.

    Roberts 2012, p. 298.

  2. 2.

    ‘Private-Public divide’ as described by Hess 2018, pp. 71–73 et seq., 78–79.

  3. 3.

    As is the case with Regulation (EU) no 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast), OJ 2012 L 351/1 (hereinafter referred to as Brussels I-bis Regulation).

  4. 4.

    Hess 2018, pp. 71 et seq.

  5. 5.

    Ibid., pp. 78 et seq.

  6. 6.

    Arbitration has been explicitly excluded from the scope of the European procedural law by Article 1 (2) (d) of the Council Regulation (EC) no 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, OJ L 012, 16/01/2001 P. 0001 - 0023 (hereinafter referred to as Brussels I Regulation). As explained by Hess et al 2008, pp. 31 et seq., historically, the exclusion of commercial arbitration from the scope of the European procedural law is explained by the existence of the parallel system provided by the 1958 UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Despite some attempts to develop new instruments applicable to arbitration on the European level, the ECJ jurisprudence referred to commercial arbitration as a national law matter, cf. Case C-190/89, Marc Rich, ECLI:EU:C:1991:319 para 18, Case C-391/95, Van Uden, ECLI:EU:C:1998:543, paras 25 et seq.

  7. 7.

    ‘Area of Justice’, as referred to by Van Houtte 2007, pp. 425 et seq.

  8. 8.

    COM (2010) 748 final, December 14, 2010 (revised on 3 January 2011): Proposal for a Regulation of the European Parliament and of the Council on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, CELEX 32012R1215, following the Commission Green Paper COM (2009) 179.

  9. 9.

    Van Houtte 2007, p. 425. The approach that prevailed assumes, however, that ‘communitarisation’ of international arbitration is ‘useless’ and may be ‘dangerous.’ See Benedettelli 2012, p. 583.

  10. 10.

    Despite some attempts in favor of arbitration in the field of merger clearances as the instruments of ‘private enforcement’, ibid., p. 593.

  11. 11.

    Directive 2013/11/EU of the European Parliament and of the Council of 21 May 2013 on alternative dispute resolution for consumer disputes and amending Regulation (EC) no 2006/2004 and Directive 2009/22/EC (Directive on consumer ADR), OJ L 165, 18.6.2013, pp. 63–79.

  12. 12.

    Szpunar 2017, p 87.

  13. 13.

    Regulation (EU) no 912/2014 of the European Parliament and of the Council of 23 July 2014 establishing a framework for managing financial responsibility linked to investor-to-state dispute settlement tribunals established by international agreements to which the European Union is party, OJ L 257, 28.8.2014, pp. 121–134.

  14. 14.

    Szpunar 2017, pp. 92–93.

  15. 15.

    Case C-284/16, Slovakische Republik v Achmea BV, ECLI:EU:C:2018:158.

  16. 16.

    Agreement on encouragement and reciprocal protection of investments between the Kingdom of the Netherlands and the Czech and Slovak Federative Republic, 29 Apr. 1991.

  17. 17.

    Hess 2018, p. 155.

  18. 18.

    Von Goldbeck, p. 444; Sadowski 2018, p. 1052 et seq., both criticising the division made in Achmea.

  19. 19.

    Van Harten 2007, p. 58.

  20. 20.

    Ibid., pp. 58–59; Kulick 2012, p. 83; Schill 2010, pp. 410–412.

  21. 21.

    Schill 2010, p. 410.

  22. 22.

    Roberts 2012, p. 298.

  23. 23.

    Schill, p. 410.

  24. 24.

    Ibid., p. 410.

  25. 25.

    Hess 2018, p. 155.

  26. 26.

    Schreuer 2008, p. 831.

  27. 27.

    Hess, pp. 155–156.

  28. 28.

    Lim and Uson 2019, pp. 1 et seq.

  29. 29.

    Hess 2018, p. 193.

  30. 30.

    Ibid., pp. 196–199.

  31. 31.

    Lavranos 2017, p. 302.

  32. 32.

    The divergences between different types of dispute settlement mechanisms seem to be increasing also as a result of the recent reforms of the investment arbitration system as proposed by the EU. In a reaction to criticisms raised against traditional investor-state arbitration, the European Commission has proposed the establishment of a new dispute settlement system between investors and states, reforming existing investor-state dispute settlement mechanisms.

  33. 33.

    Achmea, para 54.

  34. 34.

    Ibid., para 54.

  35. 35.

    Ibid., para 55.

  36. 36.

    Ibid., para 55.

  37. 37.

    Ibid., para 55.

  38. 38.

    Contartese and Andenas 2019, p. 180; Melchionda 2018, p. 343; Von Goldbeck 2018, pp. 442–444; Sadowski 2018, p. 1050.

  39. 39.

    Von Goldbeck 2018, p. 442; Melchionda 2018, p. 343; Sadowski 2018, p. 1050.

  40. 40.

    Thieffry 2018, p. 210. See infra.

  41. 41.

    It might be the case of investment arbitration tribunals having a seat outside the EU, without the possibility for a court of a Member State to review the arbitral award.

  42. 42.

    Lavranos 2017, pp. 303 et seq.

  43. 43.

    Opinion of AG Wathelet, Case C-284/16, Slovakische Republik v Achmea BV, ECLI:EU:C:2017:699.

  44. 44.

    Ibid., para 90.

  45. 45.

    Ibid., para 91.

  46. 46.

    Ibid., para 92.

  47. 47.

    Achmea, para 55.

  48. 48.

    Ibid., para 245.

  49. 49.

    Case C-125/04, Guy Denuit, ECLI:EU:C:2005:69; Case C-394/11, Belov, ECLI:EU:C:2013:48; Case C-377/13, Ascendi, ECLI:EU:C:2014:1754; Case C-555/13, Merck Canada, ECLI:EU:C:2014:92.

  50. 50.

    Opinion of AG Wathelet in Achmea, paras 91 and 96.

  51. 51.

    Ibid., para 110.

  52. 52.

    Ibid., para 245.

  53. 53.

    Damjanovic and De Sadeleer 2019, p. 41: ‘(…) in light of the CJEU’s reasoning in Achmea, it seems that the validity of commercial arbitration under EU law has been reinforced’.

  54. 54.

    Von Goldbeck 2018, p. 439.

  55. 55.

    Thieffry 2018, p. 206.

  56. 56.

    Achmea, paras 35–37 and 39.

  57. 57.

    Ibid., paras 43 and 50.

  58. 58.

    Case C-126/97, Eco Swiss, ECLI:EU:C:1999:269.

  59. 59.

    Case C-168/05, Mostaza Claro, ECLI:EU:C:2006:675.

  60. 60.

    Achmea, para 54.

  61. 61.

    Opinion of AG Wathelet in Case C-67/14, Genetech, ECLI:EU:C:2016:177, para 61.

  62. 62.

    Opinion of AG Wathelet in Achmea, paras 174–228.

  63. 63.

    Achmea, para 40.

  64. 64.

    Ibid., para 41.

  65. 65.

    Ibid., para 42.

  66. 66.

    Ibid., paras 56 and 58. But cf. Opinion of AG Bot in Opinion 1/17, EU-Canada CETA Agreement, ECLI:EU:C:2019:72, para 110; Opinion 1/17, EU-Canada CETA Agreement, ECLI:EU:C:2019:341.

  67. 67.

    Nouvel 2018, p. 914; Thieffry 2018, p. 212. Cf. AES Summit v. Hongrie, ICSID, case n° ARB/07/22, final award of 23 Sept. 2010, Pt 7.6.6. In the case of the Netherlands-Slovakia BIT, Article 8 foresees ‘the law in force of the Contracting Party concerned’ as applicable law. However, in light of the Achmea ruling, the nature of EU law—be it a part of national law, international law or a legal fact—is irrelevant in the context of the autonomy of EU law.

  68. 68.

    Nouvel 2018, p. 914, see infra.

  69. 69.

    Sadowski 2018, p. 1052.

  70. 70.

    Argument raised by Sadowski 2018, p. 1055.

  71. 71.

    Ibid., p. 1055.

  72. 72.

    Ibid., p. 1054.

  73. 73.

    Achmea, para 43.

  74. 74.

    Achmea, para 50.

  75. 75.

    Case C-102/81, Nordsee, ECLI:EU:C:1982:107, para 10.

  76. 76.

    Ibid., para 7.

  77. 77.

    Opinion of AG Szpunar in Ascendi, ECLI:EU:C:2014:246, para 33; Szpunar 2017, p. 98.

  78. 78.

    This is the case of the following jurisprudence: Ascendi, paras 25–26 (relativity of permanence criterion); AG Szpunar Opinion in Ascendi, paras 39–40 (flexibility of criterion of the compulsory character); Almelo, para 24 (relativity of requirement of applying the rule of law), as discussed by Szpunar 2017, p. 98.

  79. 79.

    As described by Basedow 2015, p. 367.

  80. 80.

    Szpunar 2017, p. 100, referring to Merc Canada, para 19.

  81. 81.

    Von Papp 2013, pp. 1067 et seq.; Basedow 2015, pp. 380 et seq. (concerning a panel of ISDC or UNCITRAL arbitration under BIT); Paschalidis 2016, pp. 15 et seq.

  82. 82.

    Opinion of AG Wathelet in Achmea, paras 126, 127.

  83. 83.

    Ibid.

  84. 84.

    Basedow 2015, pp. 382 et seq.; Szpunar 2017, p. 111.

  85. 85.

    Wildemeersch 2018, p. 43.

  86. 86.

    Argument raised by Basedow 2015, p. 384, referring to Ascendi, para 26.

  87. 87.

    Achmea, para 49.

  88. 88.

    Achmea, para 54, referring to Eco Swiss and Mostaza Claro.

  89. 89.

    Contartese and Andenas 2019, pp. 180 et seq.

  90. 90.

    Thieffry 2018, p. 210.

  91. 91.

    Eco Swiss, para 35.

  92. 92.

    Bermann 2011, p. 1203.

  93. 93.

    As argued by Lanotte 2018, p. 268.

  94. 94.

    Thieffry 2018, p. 206.

  95. 95.

    Alternative solutions are discussed by Lavranos 2017, pp. 306 et seq.

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  1. Court of Justice of the European Union, Research and Documentation Directorate, Rue du Fort Niedergrünewald, 2925, Luxembourg, Luxembourg

    Lidia Sokolowska

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  1. Faculty of Law, University of Oslo, Oslo, Norway

    Mads Andenas

  2. Department of Political and Social Sciences, University of Cagliari, Cagliari, Italy

    Luca Pantaleo

  3. Université du Luxembourg, Luxembourg, Luxembourg

    Matthew Happold

  4. Hague University of Applied Sciences, The Hague, The Netherlands

    Cristina Contartese

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Sokolowska, L. (2020). Convergences and Divergences of Commercial and Investment Arbitration Under Achmea (C-284/16). In: Andenas, M., Pantaleo, L., Happold, M., Contartese, C. (eds) EU External Action in International Economic Law. T.M.C. Asser Press, The Hague. https://doi.org/10.1007/978-94-6265-391-7_13

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