Originally from The American Review of International Arbitration (ARIA)

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ABSTRACT

Given the challenges of investment arbitration, the tension between public and private entities has contributed to difficult discussions within the arbitration community. Among these, the highly disputed Achmea judgment which has marked the international agenda since 2018 has set in motion the debate on the issue of the compatibility and validity of an arbitration clause that was presumably to shape the international arbitration market from that date on. The perplexities surrounding the EU’s political statement on the incompatibility of the arbitration clause at dispute were only increased by the need to define boundaries on how that decision would ultimately set a precedent for upcoming cases. For such reasons, attention has been drawn to, among others, cases such as Republic of Poland v PL Holdings, UP (formerly Le Chèque Déjeuner) and C.D Holding Internationale v. Hungary or Vattenfall AB and others v. Federal Republic of Germany. Six years after the decision, and in a constantly changing international context, we are to revisit the Achmea judgment, seeking to evaluate how it has impacted the risk assessment of arbitration clauses in similar cases.

I.  INTRODUCTION

A.  The Achmea Judgment: Background

International investment arbitrations raise multiple challenges that do not end within the walls of the need to promote both investments worldwide and economica development.  Unlike commercial arbitration, investment arbitration deals mostly with the difficult tension between foreign investors and sovereign States which entails a particular risk assessment to be made. Among this framework, ICSID---International Centre for Settelement of Investment Disputes (the "ICSID")---attributed to the Washington Convention and BIT---Bilateral Investment Treaties (hereinafter "BIT")---represent important landmarks that not only define how investment arbitrations are to be conducted but also the limits to such proceedings.

In common with commercial arbitration there is, however, the need to promote uniformity within the international market which cannot be set aside when coming to potential precedented decisions. The controversy around the Achmea's judgment was indeed bounded by this concern alongside the narrow limits of EU’s political intervention when establishing the scope and validity of investment arbitration.