SPANISH ENERGY BIT AWARDS
The European Union’s top court ruled on that arbitration clauses common to almost 200 investment agreements between EU member countries violate EU law, casting doubt on such deals and others struck by the bloc as a whole.
It said the arbitration tribunal that made the order was not a court of a member state, had no power to refer matters to the ECJ and that its decisions were final, even though disputes referred to it could concern the application or interpretation of EU law.
“The arbitration clause in the BIT has an adverse effect on the autonomy of EU law, and is therefore incompatible with EU law,” the court said. so the European Commission is seeking to address these issues by proposing a mediation mechanism.
As a result of this rule, the European Commission has told Spain that arbitral awards compensating investors over reforms to the state’s renewable energy subsidy regime cannot be paid without EU approval.