Pending the development and implementation of a replacement system, investors may consider structuring new investments through a vehicle installed outside the EU – or restructuring their existing investments – to provide ILO protection between a Member State (or THE EU) and a non-EU state. Where possible, investors can also try to reach a specially negotiated agreement with the Member State or its instruments. In order for an investment not to be excluded from contractual protection, there can be no dispute or reasonably anticipated at the time of the restructuring. The whistleblowing agreement simply stipulates that all internal EU bits in an annex are denounced by this agreement. In addition, it states that the “Sunset” clauses contained in the internal EU bit “have no legal effect”. It is interesting to note that the termination agreement does not explain what will happen to the dispute if no transaction agreement has been reached. Can the investor continue the arbitration process or is the dispute suddenly closed? On 5 May 2020, the majority of EU Member States signed a commitment termination agreement to end all bilateral investment agreements (ILOs) between two EU Member States (INTRA-EU ILOs) 1. It is interesting to note that the intermediary must not only be independent and impartial, but also have an in-depth knowledge of EU law, not an in-depth knowledge of investment law. If the parties fail to agree on an intermediary, the authority vested with the power of the framework, left open in brackets in the draft text, appoints the mediator. The contract also contains provisions on pending arbitration proceedings, i.e. arbitration proceedings that were initiated prior to Achmea and are not yet completed.
In such cases, Article 9 provides for the possibility for a party, investor or EU Member State to request a “structured dialogue”, but only within six months of the end of the relevant ILO. Article 9, paragraph 7, provides that such a procedure is “supervised by an impartial mediator in order to find between the parties an amicable, legitimate and fair settlement of the dispute being the subject of arbitration.” The transaction procedure is impartial and confidential and the intermediary enters into a transaction agreement within six months. However, contracting parties may agree to a longer period of time if they deem it appropriate. On 24 October 2019, EU member states reached a multi-lateral agreement to end bilateral investment agreements within the EU. The agreement follows statements made on 15-16 January 2019 on the legal consequences of the Court of Justice ruling in the Achmea case and on the protection of investments in the European Union, in which Member States pledged to end their internal EU BIT. Sunset clauses are provisions protecting investments made before the end of the relevant ILO for a specified period, usually for an additional period of 10 to 20 years after termination.