National courts continue to draw all the consequences of the Achmea ruling (CJEU, March 6, 2018, C-284/16) and its derivative case law (Komstroy, PL Holdings, etc.), reaffirming the incompatibility of arbitration clauses included in intra-EU bilateral investment treaties (BITs) with EU law.
In Germany, the Federal Court refused to recognize an arbitral award handed down in the case of Antaris v. Czech Republic, including the part relating to costs. The German investor, whose claims on the merits had been rejected, contested only the award of costs. The Court ruled that the invalidity of the intra-EU arbitration clause extends to the entire award, without it being possible to isolate certain provisions (such as those addressing costs). Thus, any award based on such a clause remains entirely contrary to Articles 267 and 344 of the Treaty on the Functioning of the European Union (TFEU), regardless of its subject matter.
In the Netherlands, the Amsterdam Court of Appeal went a step further by ordering an investor (LC Corp) to terminate arbitration proceedings brought in London against Poland on the basis of an intra-EU BIT. The Court ruled that the continuation of arbitration that was manifestly contrary to EU law constituted unlawful conduct for which the investor was liable. It therefore ordered the investor, subject to a penalty payment, to cooperate with the State in filing a joint request to terminate the arbitration proceedings.
These two decisions illustrate the growing firmness of the national courts of the European Union Member States towards intra-EU investment arbitration:
- no partial recognition of awards made on the basis of intra-EU arbitration clauses is possible, including for costs; and
- judges may actively intervene to prevent the continuation of arbitrations deemed unlawful under EU law.
These decisions are part of a now well-established tendency: EU Member State courts systematically refuse to implement arbitration clauses contained in intra-EU BITs and do not hesitate to use all the tools available in procedural law to prevent their enforcement or even to interrupt ongoing arbitration proceedings. However, this approach contrasts increasingly with that of courts in non-EU Member States: recently, Swiss, British, and US courts have, on the contrary, recognized and enforced several awards based on such treaties.
Thus, despite the European institutions’ stated desire to put an end to intra-EU investment arbitration, as long as the treaties in question (in particular the Energy Charter Treaty) remain in force under international law, the divide between the European Union and the rest of the world continues to widen, creating a true two-tier system.
German Federal Court, 27 March 2025, n° ZB 64/24.
Amsterdam Court of Appeal, 22 April 2025, n° 200.328.367/01.
