Intra-EU BIT

Intra-EU bilateral investment treaties (BITs) are investment protection agreements concluded between two states that are both members of the European Union. Most were signed in the 1990s between "old" EU-15 states and the central and eastern European countries that later acceded in 2004, 2007, and 2013 — for example, the Netherlands–Czech and Slovak Federal Republic BIT (1991) or the Germany–Poland BIT (1989). They typically guarantee fair and equitable treatment, protection against expropriation without compensation, free transfer of capital, and — crucially — investor-state dispute settlement (ISDS), usually through ICSID or UNCITRAL arbitration.

Their legal status became deeply contested after EU enlargement. The European Commission long argued that intra-EU BITs were incompatible with EU law because they discriminate between investors of different member states and remove disputes from the jurisdiction of EU courts, undermining the autonomy of the EU legal order. This position was vindicated by the Court of Justice of the European Union in Slovak Republic v. Achmea (Case C-284/16, judgment of 6 March 2018), which held that arbitration clauses in intra-EU BITs are incompatible with Articles 267 and 344 TFEU.

Following Achmea, 23 EU member states signed the Agreement for the Termination of Bilateral Investment Treaties between the Member States of the European Union on 5 May 2020, which entered into force on 29 August 2020 and terminates most remaining intra-EU BITs along with their sunset clauses. The CJEU extended the Achmea logic to intra-EU disputes under the Energy Charter Treaty in Republic of Moldova v. Komstroy (Case C-741/19, 2021) and to ICSID proceedings in Republic of Poland v. PL Holdings (Case C-109/20, 2021).

Despite termination, arbitral tribunals outside the EU have sometimes continued to accept jurisdiction, creating ongoing friction between EU law and international investment law.