CYIL 2011

TOMÁŠ FECÁK CYIL 2 ȍ2011Ȏ included a proposal to expressly exclude the applicability of the safeguard period provided for in the respective BIT. 67 The official reasoning for termination refers to EU law aspects and to the position of the Commission. 68 But the intention to disengage from the burden of further investment arbitrations as the main motivating factor behind this initiative can hardly be unnoticed. 69 Although the consensual approach may be well reasoned, it entails similar disadvantages as the renegotiation of third countries’ BITs, as discussed above. To date, the Czech Republic has managed to terminate BITs with Italy, Denmark, Slovenia, Malta and Estonia, while the termination of the BIT with Ireland is in the process of ratification. However, the termination of some intra-EU BITs is apparently not going to proceed that smoothly. This may concern in particular the capital exporting countries, which find the current regime of BIT protection advantageous for their investors (or for special purpose companies established there). For instance, the position of the Netherlands, the seat of many holding companies administering investments elsewhere in the world, as recently expressed in arbitration proceedings in case Eureko v. Slovak Republic , is significant in this regard. 70 It seems likely that without a more active involvement of the Commission or the CJEU, the phenomenon of intra-EU BIT protection is not going to disappear in a short time. 71 4.3 Treaty of Lisbon and beyond Despite some problematic issues, the competence of Member States to enter into investment protection agreements with third countries as such had never been seriously disputed. 72 The situation, however, changed significantly with the entry of the Treaty of Lisbon ( ToL ) into force in December 2009. Under ToL, the EU gained verbal notes (5 th electoral term, Parliamentary printing No. 797). Explanatory memorandum. Available in Czech at www.psp.cz. 69 Although the officials try to be careful in their statements and are speaking only about the “redundancy” of intra-EU BITs, but it is usually in the context of debate about arbitrations against the Czech Republic and about disadvantageous BITs from early 90’s. See for instance. Supra note 37; Vláda vypoví smlouvy o ochraně investic, Hospodářské noviny, 28 August 2008; TV discussion at TV station Z1, Téma Z1 byznys a politika, 7 December 2009, transcript available at www.mfcr.cz. 70 The Dutch Government presented a series of arguments to support the validity and applicability of the BIT between the Netherlands and Slovakia. See: Eureko B.V. v. Czech Republic , Permanent Court of Arbitration Case No. 2008-13. Award on Jurisdiction, Arbitrability and Suspension (2010), paras. 155-166 71 It is noteworthy that the Commission, although verbally strongly disfavouring the existence of intra EU BITs, has so far failed to take any action against non-cooperative Member States comparable to the infringement proceeding against Austria, Sweden and Finland in the case of incompatible BITs with third countries. 72 Nevertheless, in past few years, the EU has been gradually attempting to develop its own foreign investment policy on the basis of its internal competences, particularly concerned with investment liberalization and market access (i.e. the pre-investment phase), by inserting the respective provisions in free trade and association agreements with third countries. These provisions have, however, not concerned investment protection in a strict sense and can be regarded as complementary to Member States’ BITs (i.e. the post-investment phase). 67 Ibid. 68 Ibid.

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