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law insofar as it provides for arbitration
between a Member State and an investor
of another Member State. As discussed
in our briefing on the decision, EU-based
investors will now face greater legal
hurdles when bringing ECT claims against
Member States.
On one level the decision in Komstroy
was surprising, as neither Komstroy –
a Ukrainian company – nor Moldova
were EU parties. The CJEU nevertheless
rendered a judgment on the basis that EU
law was indirectly impacted. Once again,
the EU courts' assertiveness in looking
beyond their borders was clear.
Yet, on the substance, the decision in
Komstroy represented only a further step
in the EU's goal to self-regulate energy
investments. In its 2018 Slovak Republic v.
Achmea judgment, the CJEU had already
ruled that similar investment protections
found in intra-EU bilateral investment
treaties were incompatible with EU law.
Then, following Antin v. Kingdom of Spain,
the European Commission launched an
investigation into whether the ECT award
rendered against Spain would breach
the EU's State Aid rules. The EU's current
proposal for a permanent multilateral
investment court made up of pre-selected
adjudicators will likely continue the EU
courts' expanding influence in the energy
sector.
Garreth Wong
Partner
London
T +44 20 7655 5879
garreth.wong@shearman.com
Yvonne Addai
Trainee
London
T +44 20 7655 5185
yvonne.addai@shearman.com
Alex Bevan
Partner
Abu Dhabi/Dubai
T +971 2 410 8121
abevan@shearman.com
Alastair Livesey
Senior Associate
London
T +44 20 7655 5530
alastair.livesey@shearman.com
