Poland v LC CORP BV. A second refusal for ISDS Achmea /Komstroy anti-suit, following Spain v Blasket Renewable Investments LLC and adding to the ECT fog.

In Poland v LC Corp BV, the Amsterdam first instance court mid-March refused Poland’s application for an anti-suit injunction, which would have prohibited LC Corp from seeking UNCITRAL arbitration under the now defunct Poland-Netherlands BIT, with London as curial seat.

The case echoes that of Kingdom of Spain v Blasket Renewable Investments LLC, in which the Amsterdam Court had earlier declined to hear an anti-suit injunction petition by Spain to prevent renewable investors from enforcing arbitral awards in the US: see Josep Galvez’s summary here. That case however in the meantime has encountered quite the opposite reaction from a US judge, who held end of March that Spain enjoys sovereign immunity in the case and that as a result of the CJEU’s Komstroy’s authority, neither Spain nor the defendant had power to sign up to arbitration, hence dismissing the petition to confirm an arbitral award rendered pursuant to the Energy Charter Treaty.  In turn, that decision is in contrast with earlier orders in 9REN v the Kingdom of Spain and NextEra v the Kingdom of Spain as Curtis summarise here. The Court of Appeal will now hear those issues.

The case, as Geraldo Vidigal reminded me, is also reminiscent of the interlocutory decision in ECLI:NL:RBAMS:2022:5772, also involving Poland yet in that case with an anonymised Dutch corporate defendant. In that judgment the arbitration procedure was suggested as the currently only available way for the corporation to have its day in ‘court’, seeing as in the view of the judge, the Polish rule of law crisis  questions the impartiality of the Polish courts, and the EU’s alternative Investment Court is not yet operational. Johannes Hendrik Fahner discusses that case here.

In current case, the court first of all holds that Brussels Ia’s arbitration exception is not engaged, for the case’s core, it suggests, is whether the pursuit of an arbitration proceeding despite CJEU Achmea, constitutes abuse of process. The case, it holds (4.3) does not have the questions  put to the arbitral tribunal as its object, hence the arbitration exception is not in play.
4.5 the Court re applicable law holds parties have made choice of law for Dutch law under Article 14 Rome II, obiter suggesting that finding locus damni under Rome II Article 4(1)’s general rule is not self-evident: would the damage of an abusive pursuit of arbitration proceedings, be located in The Netherlands? It is not entirely clear to me why the Court discusses applicable law (other than Dutch courts having to do so proprio motu.
4.12 the court refers to the tribunal’s Kompetenz Kompetenz. The curial seat being located outside the EU, in London, is a crucial element in the court’s reasoning, despite CJEU Achmea: it is not prima facie clear that the tribunal will refuse to hear the case. Given the overall fog re the consequences of the CJEU case-law on extra-EU arbitration, the issues are not clearly without foundation hence cannot constitute abuse.


With recent Australian developments (blogpost imminent), even more proverbial ECT s**** is hitting the fan. IMHO this conundrum is not going to be solved by ever more procedural forum shopping with conflicting outcomes.


Dutch court denies RWE, UNIPER damages for coal phase-out. Rejects ia ‘permit defence’ under the EU Emissions Trading Scheme ETS.

RWE’s case (seeking huge damages for the impact on its assets following the Dutch coal phase-out) under investor-State dispute settlement (ISDS) continues I understand (I would also suggest it is problematic given the ECT’s fork in the road provisions), while Uniper’s will be dropped as part of its bail-out conditions. Yet this post is about yesterday’s first instance Uniper judgment and RWE judgment in the Dutch courts. I use the Uniper judgment for this post, the RWE judgment is not materially different as to its legal analysis.

Of note is first of all that these judgments are by the ‘commercial’ chamber at the Den Haag court, not an ‘environmental’ chamber. This might be relevant for those wishing to present the judgment as one of a maverick band of environmental crusaders.

RWE and UNIPER’s claims are based on ‘A1P1‘ (Article 1 of the First Protocol to the European Convention on Human Rights) and Article 17 of the Charter of Fundamental Rights of the EU, both of which protect the right to property.

[5.6] the court lays out the benchmarks (translation courtesy of DeepL and double-checked by me):

( a) is there “possession” (property)

( b) is there “interference,” that is, deprivation or regulation of the right to property?

If both these conditions are met, then the following requirements are examined:

( c) is the interference “lawful,” that is, provided for by law;

( d) if so, does the infringement have a legitimate objective that serves to promote the “general interest,” and

( e) if so, is there a “fair balance,” that is, a reasonable balance, between the requirements of the general interest and the protection of the fundamental rights of the individual?

The latter “fair balance test” is not satisfied if there is an individual and excessive burden on the person concerned.

[5.9] the State had argued that uncertain future earnings are not caught by A1P1 however the court [5.10] disagrees. The corporations have a long-term guarantee to use of the site, ia via a long-term lease. That the earnings might potentially not qualify as possessions, does not diminish the qualification of the guaranteed economic interest as ‘property’.

Interference, lawfulness and general interest are established each in one para [5.11 ff] , and did not seem to be the focus of much discussion even by the parties.

Fair balance is discussed extensively [5.14] ff. [5.15.3] the court qualifies the measure as regulatory interference and not de facto expropriation (the latter would have triggered guaranteed compensation rights). Even if electricity generation using coal will be phased-out, after the end of the transition period, Uniper will continue to have use of the site and has indeed already assumed such use in announced coal-free business plans.

The court then discusses the foreseeability at length, concluding [5.16.31] that although the Dutch Government frequently expressed support for modern facilities generating electricity using coal, this was always done with the caveat that that method had to be compatible with the Dutch climate commitments. [5.16.35] the ETS permit defence is dismissed.

[5.17.9] the court, having studies the various scientific reports presented to it, holds that there are most definitely alternative uses for the site. That their profitability is uncertain, is simply also a feature of energy markets as a whole.

[5.18] the court holds that the Dutch coal phase-out does have an effect on reduced CO2 emissions (carbon leakage is not accepted as being of much relevance to that conclusion). For the measure to be considered not the least trade-restrictive, the Dutch State is held to have a wide margin of manoeuvre and it is not established that the State gravely erred in opting for a coal phase-out [5.18.7]. The long transition period is held to substantiate enough room for compensation [5.19.6], again with reference to the volatility of market returns as being part and parcel of energy markets full stop.

Like the Dutch judgments eg in Urgenda, this judgment on protection of property rights viz GHG emission reduction policies, is likely to serve as an international benchmark. It can be appealed, of course.


Milis Energy: CJEU confirms inapplicability of ECT in intra-EU relations, shields volatile energy subsidies from property rights, freedom of enterprise assault.

In Case C-306/19 Milis Energy the CJEU addresses on of the elephants in the energy transition room namely the support measures given by Member States to renewable energy installations, in particular photovoltaic energy, and the legality of reducing those support measures (a phenomenon which is to be expected seeing as the variety of energy transition measures gradually make renewable energy move from an infant industry to a mature industry).

As readers will know, reduced support and the sometimes capricious development of national energy subsidies has landed many an EU government in court, including in investor-State dispute settlement. Those latter cases often involve the controversial Energy Charter Treaty (ECT), and in current case the CJEU, not unexpectedly given its Komstroy case-law, holds that Milis, being incorporated in Italy, cannot call upon the ECT in its dispute with a Member State.

Articles 16 (freedom of enterprise) and 17 (property rights) of the EU Charter of Fundamental Rights were held not to protect Milis. With respect to Article 17, the CJEU emphasised that Member States enjoy a wide margin of discretion in the context of renewable energy subsidies and that both EU law and Italian law being subject to such volatility, an economic operator active in the sector necessarily must assume a regulatory and subsidy environment subject to frequent change, hence ruling out the qualification of enviseaged State subsidies in the sector as being a ‘good’ protected by Article 17 [41 ff]. With respect to Article 16, the Court emphasises the great discretion State enjoy to regulate economic enterprise [54 ff].



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