Financial Responsibility in the European International Investment Policy

Abstract

Financial responsibility of the EU resulting from investor-state arbitration is a politically sensitive topic that is currently shaping the emerging European international investment policy. What degree of protection can be granted to foreign investors in negotiations of future EU investment treaties without compromising EU policy space, and how much review of its regulatory powers not by the CJEU but by arbitral tribunals is the EU willing to accept? Taking the Commission’s recent draft Regulation on managing financial responsibility as the starting point, this paper analyses the implications that future EU investment agreements would have for the existing safeguards for balancing private and public interests in EU law. It discusses the latest reactions of the European Parliament to these issues (triggered by a previous version of this paper) and suggests a more scientific and sustainable approach towards ensuring that future EU agreements provide a maximum of legal certainty for both investors and host states.

JEL Classification: F13, F21, K33, K39, O16