Improving the Climate for European Investments in the Russian Electricity Production Sector: (II) The Role of Regulatory Convergence

Abstract

This article is a sequel to 'Improving the Climate for European Investments in the Russian Electricity Production Sector: (I) The Role of Investment Protection Law' that appeared in the previous issue of the Journal. It examines whether convergence of the regulatory frameworks governing the European and Russian electricity markets could improve the predictability of investment conditions in the Russian electricity production sector. Could the creation of a EU-Russian level-playing field in the electricity sector answer the legal uncertainties faced by European investors in Russia? This question is analyzed in the broader context of the EU-Russian energy relationship. The article first examines the notion of regulatory convergence and its conceptual evolution in the context of the increasing strategic importance of Russia for the European energy market. Thereafter, the potential success of this approach is assessed in light of comparative law, especially legal transplant theory.

Keywords: Russian electricity reform, investment predictability, regulatory convergence