The European Union and international investment law : the two dimensions of an uneasy relationship

"This book explores the interaction between the EU and international investment law, both at the internal level, namely within the EU internal market, and at the external level, i.e. in the context of its relations with third States. The joint treatment of these dimensions reveals that the EU has assumed an ostensibly ambivalent attitude towards international investment law. At the internal level, it has consistently asserted that intra-EU international investment agreements (IIAs) are not compatible with EU law and advocated their termination. At the external level, by contrast, it has eagerly deployed IIAs to develop its post-Lisbon international investment policy. The book finds that beneath this apparent ambivalence towards international investment law ultimately lies the EU's attempt to impose, both internally and externally, its own original model of regulation of cross-border investment. It then argues that the EU adopted this approach with a view to supporting its internal market, enhancing its external influence, and, ultimately, pursuing long-term 'federal aspirations'. Finally, the book identifies the legal and political obstacles that have curtailed the EU's efforts at both the internal and the external level"-- Provided by publisher Foreword 6 Acknowledgements 8 Contents 10 Table of Abbreviations 14 Table of Cases 16 Table of Legislation 24 1. Introduction 32 I. The Focus and the Rationale for this Study 33 II. Setting the Scene: The European Union, EU Member States and International Investment Law 34 III. Book Structure 36 2. The Role of EU Member States and the EU in the Field of Foreign Investment 39 I. The Role of European States in the Creation of the International Investment Regime 39 II. Foreign Investment and the European Integration Process: The Foundational Phase 40 III. The Emerging Role of the European Community in the Field of Foreign Investment 43 IV. Towards the Allocation at the European Union Level of the Competence Over Foreign Direct Investment 45 V. The Commission's View on Article 207 TFEU 49 VI. Setting the Ground for the Development of the EU Foreign Investment Policy 50 VII. Taking a Step Back: The Political Impracticability of the Commission's Extensive Interpretation of the Union's Competence Over Foreign Investment 55 VIII. A Rude Awakening: Opinion 2/15 and the Boundaries of the Union's Exclusive Competence Over Foreign Investment 57 IX. The Consequences of Mixity 62 X. Conclusion 65 3. The Internal Dimension: The Relationship between EU Law and Intra-EU IIAs 67 I. Possible Areas of Tension between EU Law and Intra-EU IIAs 68 II. Dealing with the Tensions between EU Law and Intra-EU IIAs: A Matter of Perspective 74 III. Clash of Paradigms: 'EU Law-Centred' Approach vs 'International Law-Centred' Approach in Practice 81 IV. The 'EU Law-Centred' Approach in the Amicus Curiae Briefs of the European Commission in the Pre-Achmea Era 82 V. The International Investment Tribunals' View on the Relationship between EU Law and Intra-EU IIAs in the Pre-Achmea Era 85 VI. The CJEU and the 'EU Law-Centred' Approach: The Achmea Judgment 93 VII. The Aftermath: The Debate on the Impact of the Achmea Judgment 99 VIII. Doubling-Down on the 'EU Law-Centred' Approach: The Commission's Communication of 19 July 2018 102 IX. Intra-EU Investment Arbitration after Achmea: The Arbitral Case Law's Perspective 103 X. The Member States' Declarations on the Legal Effects of the Achmea Judgment 106 XI. Are the 'Masters of the Treaties' Still in Charge? The Role of Member States' Declarations in Intra-EU Investment Arbitration 109 XII. The Return of the 'Masters of the Treaties': The Termination Agreement 113 XIII. The End of Intra-EU BITs? Appraising the Possible Effects of the Termination Agreement 115 XIV. Beyond Achmea: The CJEU's Bid for the Eradication of Intra-EU Investment Arbitration 118 XV. What's Next? Intra-EU Investment Arbitration under the ECT after Komstroy 122 XVI. Conclusion 126 4. The External Dimension: The EU as a Player in the Investment Treaty-Making Arena 128 I. The Initial EU's Approach to Investment Treaty-Making: Seeking Incremental Reform 129 II. The Shift Towards Systemic Reform: The Investment Court System 159 III. Conclusion 178 5. The External and the Internal Dimensions of the European Union's Action in the Field of Foreign Investment 180 I. The EU's Ambivalence Towards International Investment Law 180 II. The Obstacles Hindering the Full Implementation of the Union's Action in the Field of Foreign Investment 182 III. Conclusion 184 Postscript 186 Bibliography 188 Index 206 This book explores the interaction between the EU and international investment law, both at the internal level, namely within the EU internal market, and at the external level, ie in the context of its relations with third States. The joint treatment of these dimensions reveals that the EU has assumed an ostensibly ambivalent attitude towards international investment law. At the internal level, it has consistently asserted that intra-EU international investment agreements (IIAs) are not compatible with EU law and has advocated their termination. At the external level, it has eagerly deployed IIAs to develop its post-Lisbon international investment policy. The book finds that beneath this apparent ambivalence towards international investment law ultimately lies the EU's attempt to impose, both internally and externally, its own original model of regulation of cross-border investment. It then argues that the EU adopted this approach with a view to supporting its internal market, enhancing its external influence, and, ultimately, pursuing long-term 'federal aspirations'. Finally, the book identifies the legal and political obstacles that have curtailed the EU's efforts at both the internal and the external level. Studies in International Trade and Investment Law: Volume 29