Eureko BV v the Slovak Republic

In Eureko BV v the Slovak Republic (PCA Case No 2008-13, UNCITRAL Arbitration Rules) Award on Jurisdiction, Arbitrability and Suspension, an UNCITRAL tribunal considered Slovakia's jurisdictional objection based on its accession to the EU.

The dispute arose under the bilateral investment treaty between the Netherlands and the Czech and Slovak Federal Republic. The claimant was a Dutch financial services group. The underlying dispute was based on the claimant's allegations of indirect expropriation caused by Slovakia's reversal of the liberalisation of its health insurance market in 2006. The respondent in an UNCITRAL arbitration, Slovakia, raised a jurisdictional objection claiming that the bilateral investment treaty (BIT) between Slovakia and the Netherlands was terminated by virtue of the accession of Slovakia to the EU. The tribunal rejected the objection and found it had jurisdiction over the dispute.

The tribunal found that:

• The BIT had not been terminated.
• The BIT was not incompatible with EU law, and therefore applied.
• The BIT granted more extensive rights to investors than existed under EU law.
• The arbitration clause in the BIT did not violate EU law.
• The relevance of EU law to the dispute did not make the dispute non-arbitrable.

The award addresses the controversial issue of "intra-EU BITs" and contains the tribunal's in-depth observations concerning differences in the standard of investor protection offered under the BIT and EU law, and the European Commission's observations concerning intra-EU BITs. The award illustrates the potential competition between two overlapping regimes of international economic law: EU law on the one hand, and intra-EU BITs on the other. (Eureko BV v the Slovak Republic (PCA Case No 2008-13, UNCTIRAL Arbitration Rules) Award on Jurisdiction, Arbitrability and Suspension (26 October 2010).)

Source: http://dispute.practicallaw.com/7-503-9310#null