European Energy Charter 11

European Energy Charter




(1) This Article shall not apply to Articles 12, 13 and 29.

(2) The provisions of this Treaty other than

(a) those referred to in paragraph (1); and

(b) with respect to subparagraph (i), Part III of the Treaty shall not
preclude any Contracting Party from adopting or enforcing any measure

(i) necessary to protect human, animal or plant life or health;

(ii) essential to the acquisition or distribution of Energy Materials and
Products in conditions of short supply arising from causes outside the control
of that Contracting Party, provided that any such measure shall be consistent
with the principles that

(A) all other Contracting Parties are entitled to an equitable share of the
international supply of such Energy Materials and Products; and

(B) any such measure that is inconsistent with this Treaty shall be
discontinued as soon as the conditions giving rise to it have ceased to exist;

(iii) designed to benefit Investors who are aboriginal people or socially or
economically disadvantaged individuals or groups or their Investments and
notified to the Secretariat as such, provided that such measure
(A) has no significant impact on that Contracting Party’s economy; and

(B) does not discriminate between Investors of any other Contracting Party
and investors of that Contracting Party not included among those for whom the
measure is intended,

provided that no such measure shall constitute a disguised restriction on
Economic Activity in the Energy Sector, or arbitrary or unjustifiable
discrimination between Contracting Parties or between Investors or other
interested persons of Contracting Parties. Such measures shall be duly
motivated and shall not nullify or impair any benefit one or more other
Contracting Parties may reasonably expect under this Treaty to an extent greater
than is strictly necessary to the stated end.

(3) The provisions of this Treaty other than those referred to in paragraph
(1) shall not be construed to prevent any Contracting Party from taking any
measure which it considers necessary:

(a) for the protection of its essential security interests including those

(i) relating to the supply of Energy Materials and Products to a military
establishment; or

(ii) taken in time of war, armed conflict or other emergency in international

(b) relating to the implementation of national policies respecting the
non-proliferation of nuclear weapons or other nuclear explosive devices or
needed to fulfil its obligations under the Treaty on the Non-Proliferation of
Nuclear Weapons, the Nuclear Suppliers Guidelines, and other international
nuclear non-proliferation obligations or understandings; or

(c) for the maintenance of public order.

Such measure shall not constitute a disguised restriction on Transit.

(4) The provisions of this Treaty which accord most favoured nation treatment
shall not oblige any Contracting Party to extend to the Investors of any other
Contracting Party any preferential treatment:

(a) resulting from its membership of a free-trade area or customs union; or

(b) which is accorded by a bilateral or multilateral agreement concerning
economic cooperation between states that were constituent parts of the former
Union of Soviet Socialist Republics pending the establishment of their mutual
economic relations on a definitive basis.



(1) The provisions of this Treaty shall not be so construed as to oblige a
Contracting Party which is party to an Economic Integration Agreement
(hereinafter referred to as “EIA”) to extend, by means of most favoured nation
treatment, to another Contracting Party which is not a party to that EIA, any
preferential treatment applicable between the parties to that EIA as a result of
their being parties thereto.

(2) For the purposes of paragraph (1), “EIA”means an agreement substantially
liberalizing, inter alia, trade and investment, by providing for the absence or
elimination of substantially all discrimination between or among parties thereto
through the elimination of existing discriminatory measures and/or the
prohibition of new or more discriminatory measures, either at the entry into
force of that agreement or on the basis of a reasonable time frame.

(3) This Article shall not affect the application of the GATT and Related
Instruments according to Article 29.





(1) Disputes between a Contracting Party and an Investor of another Contracting
Party relating to an Investment of the latter in the Area of the former, which
concern an alleged breach of an obligation of the former under Part III shall,
if possible, be settled amicably.

(2) If such disputes can not be settled according to the provisions of paragraph
(1) within a period of three months from the date on which either party to the
dispute requested amicable settlement, the Investor party to the dispute may
choose to submit it for resolution:

(a) to the courts or administrative tribunals of the Contracting Party party
to the dispute;

(b) in accordance with any applicable, previously agreed dispute settlement
procedure; or

(c) in accordance with the following paragraphs of this Article.

(3) (a) Subject only to subparagraphs (b) and (c), each Contracting
Party hereby gives its unconditional consent to the submission of a dispute to
international arbitration or conciliation in accordance with the provisions of
this Article.

(b) (i) The Contracting Parties listed in Annex ID do not give such
unconditional consent where the Investor has previously submitted the dispute
under subparagraph (2)(a) or (b). (ii) For the sake of transparency, each Contracting Party that is listed in Annex ID shall provide a written statement of its policies, practices and
conditions in this regard to the Secretariat no later than the date of the
deposit of its instrument of ratification, acceptance or approval in accordance
with Article 39 or the deposit of its instrument of accession in accordance with
Article 41.

(c) A Contracting Party listed in Annex IA does not give such unconditional
consent with respect to a dispute arising under the last sentence of Article

(4) In the event that an Investor chooses to submit the dispute for resolution
under subparagraph (2)(c), the Investor shall further provide its consent in
writing for the dispute to be submitted to:

(a) (i) The International Centre for Settlement of Investment Disputes,
established pursuant to the Convention on the Settlement of Investment Disputes
between States and Nationals of other States opened for signature at Washington,
18 March 1965 (hereinafter referred to as the “ICSID Convention”), if the
Contracting Party of the Investor and the Contracting Party party to the dispute
are both parties to the ICSID Convention; or

(ii) The International Centre for Settlement of Investment Disputes,
established pursuant to the Convention referred to in subparagraph (a)(i), under
the rules governing the Additional Facility for the Administration of
Proceedings by the Secretariat of the Centre (hereinafter referred to as the
“Additional Facility Rules”), if the Contracting Party of the Investor or the
Contracting Party party to the dispute, but not both, is a party to the ICSID

(b) a sole arbitrator or ad hoc arbitration tribunal established under the
Arbitration Rules of the United Nations Commission on International trade law
(hereinafter referred to as “UNCITRAL”); or

(c) an arbitral proceeding under the Arbitration Institute of the Stockholm
Chamber of Commerce.

(5) (a) The consent given in paragraph (3) together with the written consent of
the Investor given pursuant to paragraph (4) shall be considered to satisfy the
requirement for:

(i) written consent of the parties to a dispute for purposes of Chapter II of
the ICSID Convention and for purposes of the Additional Facility Rules;

(ii) an “agreement in writing”for purposes of article II of the United
Nations Convention on the Recognition and Enforcement of Foreign Arbitral
Awards, done at New York, 10 June 1958 (hereinafter referred to as the “New York
Convention”); and

(iii) “the parties to a contract [to] have agreed in writing”for the
purposes of article 1 of the UNCITRAL Arbitration Rules.

(b) Any arbitration under this Article shall at the request of any party to
the dispute be held in a state that is a party to the New York Convention.
Claims submitted to arbitration hereunder shall be considered to arise out ofa commercial relationship or transaction for the purposes of article I of that

(6) A tribunal established under paragraph (4) shall decide the issues in
dispute in accordance with this Treaty and applicable rules and principles of
international law.

(7) An Investor other than a natural person which has the nationality of a
Contracting Party party to the dispute on the date of the consent in writing
referred to in paragraph (4) and which, before a dispute between it and that
Contracting Party arises, is controlled by Investors of another Contracting
Party, shall for the purpose of article 25(2)(b) of the ICSID Convention be
treated as a “national of another Contracting State”and shall for the purpose
of article 1(6) of the Additional Facility Rules be treated as a “national of
another State”.

(8) The awards of arbitration, which may include an award of interest,
shall be final and binding upon the parties to the dispute. An award of
arbitration concerning a measure of a sub-national government or authority of
the disputing Contracting Party shall provide that the Contracting Party may pay
monetary damages in lieu of any other remedy granted. Each Contracting Party
shall carry out without delay any such award and shall make provision for the
effective enforcement in its Area of such awards.




See Also

References and Further Reading

About the Author/s and Reviewer/s

Author: international

Mentioned in these Entries

European Energy Charter, International trade law, Settlement of Disputes.



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