CYIL vol. 8 (2017)

TOMÁŠ FECÁK CYIL 8 ȍ2017Ȏ The silence of the regulation on this important issue is certainly not the best of the solutions which were available. Payments of sums awarded by tribunals are not only the internal matter concerning the relationship between the Union and Member States relating to the financial responsibility, but it is first and foremost the question of the relationship between the Union and the investor flowing from the alleged international responsibility of the former. The regulation only implicitly assumes that where the Member State acts as the respondent in an investment dispute, the payment of the compensation awarded by the tribunal is purely the matter of that Member State, which does not concern the Union anymore. One may ask how this implicit assumption fits with another implicit assumption on which the regulation is based that the international responsibility for any breaches of Union investment agreements, regardless the attribution of the conduct, shall always be borne by the Union. The Union may arguably create such a special rule of international responsibility concerning payment of awards; it would be however far more appropriate if this special rule, constituting an exception from declared international responsibility of the Union, was articulated explicitly by the regulation (just like the regulation explicitly provides in which situations the Member State shall act as the respondent). In cases where the Union acts as the respondent in the dispute, Article 18 anticipates that the sum awarded by the tribunal will be paid by the Commission. As an exception, the payment should be made by the Member State if it accepted financial responsibility. Article 19 lays down the procedure for implementation of the financial responsibility where the Union acted as the respondent and the Member State is in the Commission’s view fully or partly financially responsible. The basic principle is that the investor bringing the claim should not be adversely affected by any disagreement between the Union and the Member State. Therefore, any award or settlement should be paid promptly by the Commission and the apportionment of the financial responsibility and internal settlement between the Commission and the Member State concerned should be solved subsequently on the EU internal level. If the Commission considers that the award or settlement or costs arising from the arbitration in question should be paid, in part or in full, by the Member State, it shall adopt a decision addressed to the Member State concerned, determining the amount to be paid by that Member State. If the Member State is dissatisfied with the Commission’s decision, it may ultimately seek redress before the CJEU. 33 The apportionment of the costs arising from the arbitration should follow the same principles as the apportionment of compensations awarded by the tribunal set out in Article 3. Where the Union acts as the respondent, the Commission may adopt a decision requiring the Member State concerned to advance financial contributions to the budget of the Union in respect of foreseeable or incurred costs arising from the arbitration (Article 20). To the extent that the costs arising from the arbitration are awarded to the Union by the arbitral tribunal, the Commission will transfer the advance payments back to the Member State. 3.2 The General Concept of the Regulation from the International Law Perspective and its Reflection in the New EU IIAs What can be said about the regime of responsibility for breaches of Union investment agreements introduced by the regulation from the international law perspective? It should

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33 Ibid.