The Regional Community Subsystem within the International Foreign Investment Protection System.

Abstract

Recent years have evidenced a progressive communitarization of competence over the protection of foreign direct investment. The European Commission has made numerous efforts to affront the problems regarding the compatibility between the international system established under BITs and the fledgling regulatory system created by the regional community subsystem. The participation of the European Commission in a political agreement celebrated to adequate the community subsystem to some BITs concluded by Central European and Eastern European States with the USA as well as its attempts to incorporate some amicus curiae submissions before ICSID tribunals, should be valued positively in the international arena. As a result of the Commission’s limited powers in the «relational structure», both measures offer only partial and insufficient solutions to the problems set forth in the present state of development of the EU competence in the protection of foreign direct investment. For this reason, the Commission has created additional solutions from the integration sector. Diverse case law precedents recognize the existence of an obligation of result on behalf of member States, consisting in adapting their BITs celebrated with third parties prior to adhesion to the EU with the Community subsystem through denunciation or renegotiation. Furthermore, through its Minimum Platform on Investment, the Commission has proposed a combination of elements which determine its initial position during the negotiation of international agreements with third parties. In addition to the entry into force of the Treaty of Lisbon, which recognizes such a competence, the adoption of a community model BIT would aid in overcoming the different national positions and would also offer solutions which might eliminate some regulatory conflicts between the regional community subsystem and the international system.