Dechert’s International Arbitration Team Secures Two Historic Victories for Poland Before French Courts – a Worldwide-First Landmark After the Achmea Case
In two landmark decisions of 19 April 2022, Dechert obtained the annulment of two arbitration awards rendered against the Republic of Poland from the Paris Court of Appeal, on the basis that they are contrary to European law. This was in line with the Achmea judgment of the Court of Justice of the European Union (the “CJEU”). This is the first time that such an annulment has been obtained anywhere in the world since the Achmea case itself.
Both investment arbitrations were based on the arbitration clause of a bilateral investment treaty (a “BIT”). These treaties allow an investor from one of the two signatory States to sue the other State – that hosting the investment – before an international arbitration tribunal, in the event of a breach by the host State of one or more of the guarantees provided by the BIT. In a 6 March 2018 decision in the Achmea case, the CJEU held that an arbitration clause contained in a BIT between two EU Member States was precluded by EU law, particularly the principle of mutual trust between Member States, and could not form the basis of an arbitral tribunal’s jurisdiction.
The Achmea award had subsequently been annulled by German courts, but no other court, including French courts, had yet had the opportunity to rule on the annulment of an award on this basis until those two decisions of the Paris Court of Appeal.
These rulings will therefore set a worldwide precedent. They attest to the paradigm shift in intra-EU investment disputes that the Achmea judgment initiated and highlight the considerable impact that this decision has on ongoing and completed intra-EU investment arbitrations, as well as on the future of investment protection in the EU.
The first arbitration was initiated by two major Austrian companies, Strabag and Raiffeisen Centrobank, following privatizations in the hospitality sector after the fall of the communist regime. The second case was initiated by Czech investor Slot Group, following changes to the regulatory framework governing the sector of gambling and slot machines.
The annulments were conducted in two separate proceedings before the Court of Appeal, which resulted in the two decisions being handed down on the same day.
The Republic of Poland was represented by Dechert's Eduardo Silva Romero, Quentin Muron and Audrey Caminades.
About Dechert
Dechert is a leading global law firm with 22 offices around the world. We advise on matters and transactions of the greatest complexity, bringing energy, creativity and efficient management of legal issues to deliver commercial and practical advice for clients.
Our team in France has 70 lawyers focused on corporate and securities, international arbitration, litigation, investigations and compliance, antitrust/competition, regulatory, financing, tax, financial services matters, intellectual property and labor and employment.
