Disentangling Conflicts of Laws in EU and Member States' Investment Agreements

The European Union (“EU”) is integrated into global markets via an open investment regime, which has fostered the development of wide economic relations. In 2019, the net investment outflow from EU Member States toward third countries totaled $42,6761 million, while inflow totaled $47,3196 million. To regulate investment disparities since the establishment of the common market in the 1950s, EU Member States have concluded about 1400 multilateral investment treaties (“MITs”) and bilateral investment treaties (“BITs”) with third countries. EU Member States have also negotiated around 190 MITs and BITs inter se, or intra-EU investment agreements. Since the adoption of the Lisbon Treaty in 2009, the EU has negotiated international investment agreements with economies such as Australia, Canada, China, Vietnam, Singapore, and the United States. Among these agreements, the Energy Charter Treaty (“ECT”) is both an intra-EU and extra-EU investment agreement, to which both the EU and Member States are parties. It is therefore of critical importance to establish a predictable legal framework governing investments within and outside of the EU.