European Papers (Feb 2023)

PL Holdings case: The Investor Ordered to Pay the Expropriating State's Costs, a New Consequence of Achmea

  • Raphaël Maurel

DOI
https://doi.org/10.15166/2499-8249/617
Journal volume & issue
Vol. 2022 7, no. 3
pp. 1131 – 1139

Abstract

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(Series Information) European Papers - A Journal on Law and Integration, 2022 7(3), 1131-1139 | European Forum Insight of 10 February 2023 | (Table of Contents) I. Introduction. - II. The Supreme Court's logical solution considering EU case law. - III. The invocation of the ECHR, an option with limited effects. - IV. A (very) unfavourable solution for the investor and a case to be continued. | (Abstract) In the Swedish Supreme Court's epilogue to the PL Holdings case, the expropriated company lost all its claims against Poland, which had expropriated it. Applying the case law of the Court of Justice of the European Union (CJEU) on intra-European investment arbitration, the Supreme Court did not merely invalidate the ad hoc arbitration clause that served as the basis for the awards against Poland in 2017. Dismissing the argument of denial of justice and the weakness of the rights guarantees offered by the Polish court system to which the investor was referred, the Supreme Court also an-nulled the arbitration awards on the grounds of Swedish procedural public policy and ordered the investor to pay Poland's full costs. This ruling, not surprisingly, is far from the end of the PL Holdings case. By overturning the 2017 arbitration awards by applying CJEU case law, the Swedish Supreme Court shifts the problem by creating a denial of justice. Investors whose favourable awards are thus set aside will have to turn to the courts of the investment's host state, which is precisely what they sought to avoid by claiming arbitration based on an intra-European BIT or, as in this case, an ad hoc arbitration agreement. There is every reason to believe that new questions will be put to the CJEU and, in the future, to the European Court of Human Rights.

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