Summary

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HAVE AGREED AS FOLLOWS:

SECTION 1 - COMMON UNDERSTANDING ON THE NON-APPLICABILITY OF ARTICLE 26 OF THE ENERGY CHARTER TREATY AS A BASIS FOR INTRA-EU ARBITRATION PROCEEDINGS

Article 1

Definitions

For the purposes of this Agreement, the following definitions shall apply:

(1) 'Energy Charter Treaty' means the Energy Charter Treaty signed at Lisbon on 17 December 1994 and approved on behalf of the European Communities by Decision 98/181/EC, ECSC, Euratom on 23 September 1997, as it may be amended from time to time;

(2) 'intra-EU relations' means relations between Member States or between a Member State and the European Union;

(3) 'intra-EU arbitration proceedings' means any proceedings before an arbitral tribunal initiated with reference to Article 26 of the Energy Charter Treaty to resolve a dispute between, on the one hand, an investor of one Member State and, on the other hand, another Member State or the European Union.

Article 2

Common understanding on the interpretation and continued non-applicability of Article 26 of the Energy Charter Treaty and the lack of legal basis for intra-EU arbitration proceedings

1. The Parties hereby reaffirm, for greater certainty, that they share a common understanding on the interpretation and application of the Energy Charter Treaty according to which Article 26 of that Treaty cannot and never could serve as a legal basis for intra-EU arbitration proceedings.

The common understanding expressed in the first subparagraph is based on the following elements of European Union law:

(a) the interpretation by the CJEU of Article 26 of the Energy Charter Treaty to mean that that provision does not apply, and should never have been applied, as a basis for intra-EU arbitration proceedings; and

(b) the primacy of European Union law, recalled in Declaration No 17, annexed to the Final Act of the Intergovernmental Conference which adopted the Treaty of Lisbon, as a rule of international law governing conflict of norms in their mutual relations, with the result that, in any event, Article 26 of the Energy Charter Treaty does not and could not apply as a basis for intra-EU arbitration proceedings.

2. The Parties reaffirm, for greater certainty, that they share the common understanding that, as a result of the absence of a legal basis for intra-EU arbitration proceedings pursuant to Article 26 of the Energy Charter Treaty, Article 47(3) of the Energy Charter Treaty does not extend, and could not have extended at any time, to such proceedings. Accordingly, Article 47(3) of the Energy Charter Treaty cannot have produced legal effects in intra-EU relations when a Member State withdrew from the Energy Charter Treaty prior to the conclusion of this Agreement and would not produce legal effects in intra-EU relations if a Party withdrew from the Energy Charter Treaty subsequently.

3. For greater certainty, the Parties are in agreement that, in accordance with the common understanding expressed in paragraphs 1 and 2 of this Article, and without prejudice thereto, Article 26 of the Energy Charter Treaty does not apply as a basis for intra-EU arbitration proceedings and Article 47(3) of the Energy Charter Treaty does not produce legal effects in intra-EU relations.

4. Paragraphs 1 to 3 are without prejudice to the interpretation and application of other provisions of the Energy Charter Treaty to the extent that they concern intra-EU relations.

SECTION 2 - FINAL PROVISIONS

Article 3

Depositary

1. The Secretary-General of the Council of the European Union shall act as depositary of this Agreement (the 'Depositary').

2. The Depositary shall notify the Parties of:

(a) the deposit of any instrument of ratification, approval or acceptance in accordance with Article 5;

(b) the date of entry into force of this Agreement in accordance with Article 6(1);

(c) the date of entry into force of this Agreement for each Party in accordance with Article 6(2).

3. The Depositary shall publish this Agreement in the Official Journal of the European Union and notify the depositary of the Energy Charter Treaty, as well as the Energy Charter Secretariat, of its adoption and entry into force.

4. The Depositary shall invite the depositary of the Energy Charter Treaty to notify this Agreement to the other Contracting Parties to the Energy Charter Treaty.

5. This Agreement shall be registered by the Depositary with the United Nations Secretariat, in accordance with Article 102 of the Charter of the United Nations, following its entry into force.

Article 4 - Reservations

No reservations shall be made to this Agreement.

Article 5 - Ratification, approval or acceptance

This Agreement shall be subject to ratification, approval or acceptance.

The Parties shall deposit their instruments of ratification, approval or acceptance with the Depositary.

Article 6 - Entry into force

1. This Agreement shall enter into force 30 calendar days after the date on which the Depositary receives the second instrument of ratification, approval or acceptance.

2. For each Party which ratifies, approves or accepts it after its entry into force in accordance with paragraph 1, this Agreement shall enter into force 30 calendar days after the date of deposit by such Party of its instrument of ratification, approval or acceptance.

Article 7 - Authentic texts

This Agreement, drawn up in a single original in the Bulgarian, Croatian, Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hungarian, Irish, Italian, Latvian, Lithuanian, Maltese, Polish, Portuguese, Romanian, Slovak, Slovenian, Spanish and Swedish languages, each text being equally authentic, shall be deposited in the archives of the Depositary.

IN WITNESS WHEREOF, the undersigned Plenipotentiaries, duly authorised ...