Category: David Collins (page 1 of 2)

The UK’s Withdrawal from the Energy Charter Treaty Poses Risks for Energy Affordability and Security

February 25, 2024 / / 2 Comments

By Professor David Collins, The City Law School

Scarcely covered by the mainstream media, this Thursday (22 Feb 2024) the UK announced the withdrawal from the controversial Energy Charter Treaty (ECT), following nine EU Member States, including G7 countries France, Germany and Italy.

Entering into force in 1998 and signed by the UK in 1994, the ECT is an international investment agreement (IIA) designed to encourage foreign direct investment in the energy sector by providing protection to foreign investors against excessive governmental interference, such as expropriation or the denial of justice in administrative or legal proceedings. The ECT has been perhaps the most significant of all the IIAs, spawning more investor-state dispute settlement (ISDS) claims than any other single treaty and with it, a host of awards issued by ad hoc tribunals. By falling under the protection of the ECT, foreign investors were granted assurances that they could rely on international law rather than the unfamiliar and unstable legal systems in host countries. Investment in the energy sector is especially needful of stable and reliable legal protections because of the extended period between making an investment and achieving a return. Under the ECT, investors may seek compensation for the loss of their future profits, not merely sustained losses. Many of the investment projects facilitated by the ECT related to infrastructure privatization projects in former Soviet countries.

Very much a product of its time, the ECT faced growing criticism for its continued encouragement of investment into energy derived from fossil fuels, paying insufficient attention to the modern fixation on climate change mitigation via renewable sources. Announcing the UK’s withdrawal, the Minister of State for Energy Security and Net Zero stated that continued ECT membership was incompatible with the country’s transition towards Net Zero. With this justification in mind, the UK’s withdrawal from the ECT could not have come at a worse time; it was acknowledged recently that the true costs of the UK’s Net Zero transition were wildly understated – costing trillions of pounds more than had been reported to parliament. Government ministers were accused by former Chancellor of the Exchequer of being ‘systematically dishonest’ about the costs of the plans.

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Will the UK’s proposed Carbon Border Adjustment Mechanism violate WTO law?

November 17, 2023 / / 0 Comments

Professor David Collins, City Law School

Last week Jeremy Hunt, the UK Chancellor, announced that the UK would pursue implementation of its own Carbon Border Adjustment Mechanism (CBAM). The EU adopted its own CBAM which is due to go into effect gradually over the next few years – it is currently in an information-gathering stage.

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The Electronic Trade Documents Act is a Turning Point in the UK’s Digital Trade Strategy

September 28, 2023 / / 0 Comments

David Collins

The Electronic Trade Documents Act 2023 (ETDA) went into force on 20 September 2023. Despite receiving little attention from the media, the ETDA is one of the most significant pieces of legislation enacted by the UK government in the field of digital trade. The ETDA enables the legal recognition of trade documents such as bills of lading and bills of exchange in electronic form which are deemed to have the same legal significance of their paper equivalent.

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Sunak’s Windsor Compromise

March 10, 2023 / / 0 Comments

David Collins

The Windsor Framework (WF) concluded between the UK and EU to resolve the difficulties associated with the Irish Border reflects a significant compromise, with the UK giving the most ground. The brainchild of a more pliant and technocratic Prime Minister than his two predecessors, Rishi Sunak’s WF is in many respects an agreement that should never have been needed. The new arrangement essentially compels the EU to do what it should have done under the original Northern Ireland Protocol, i.e. impose no unreasonable barriers to trade between Great Britain (GB) and Northern Ireland (NI) while maintaining sufficient safeguards that its Single Market would not be flooded with UK goods.

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Reforms to the Energy Charter Treaty: Rebalancing International Investment Law or a Step Too Far?

January 18, 2023 / / 1 Comment

David Collins

The Energy Charter Treaty (ECT) is a multi-party investment treaty covering investment in the energy sector. Established in the 1990s, the ECT has over 50 signatories, including the UK. The ECT contains many of the traditional protections for foreign investment found in international investment agreements (IIAs), and much like international investment law generally, the treaty has been subjected to widespread criticism in recent years. The ECT has been particularly vilified for its alleged failure to deal with climate change by maintaining extensive protections for industries that supposedly contribute to this global problem.

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Legal London: Exploring London’s Role as Global Legal City

October 3, 2022 / / 0 Comments

Jed Odermatt and David Seymour

On 23 September 2022 the City Law School held its Research & Enterprise Day on the theme of Legal London. The event was an opportunity to highlight the research, teaching and scholarship at City Law School and to develop links across the University, professions and the wider community.

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Modest Gains at the WTO Ministerial Conference

June 27, 2022 / / 1 Comment

David Collins

The 12th World Trade Organization (WTO) Ministerial Conference took place in Geneva last week with representatives of all 164 member countries in attendance – collectively comprising the WTO’s highest decision-making body. The stakes were high – there have been no major multilateral trade initiatives in decades, leaving the 27-year-old organization struggling to justify its existence in a world increasingly dominated by bilateralism or worse, economic isolationism. In the aftermath of the Covid-19 pandemic and the ongoing war in Ukraine, both of which have dealt significant blows to standards of living worldwide, the WTO was under much pressure to deliver tangible progress in trade liberalization. In the minds of many, failure was simply not an option.

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The WTO’s Essential Security Exception and Revocation of Russia’s Most Favoured Nation Status following the Invasion of Ukraine

March 15, 2022 / / 3 Comments

David Collins

Shortly after Russia’s invasion of Ukraine, several nations, led by Canada and Ukraine, suspended the application of the World Trade Organization’s Most Favoured Nation (MFN) treatment to Russian goods. MFN is a foundational principle of WTO law, contained in Article I of the General Agreement on Tariffs and Trade (GATT). It promises that all WTO members will receive the same treatment as each other – the lowest tariffs on all goods offered by each WTO member will be made available to all. The effect of this trade sanction against Russia will not be lost on its president – Vladimir Putin’s masters’ thesis was allegedly on the importance of the MFN principle to international trade. The actual impact of the revocation of MFN on Russia may be less significant and the legal issues behind it are complex and troubling.

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Legal Services Provisions in the UK-EU Trade and Cooperation Agreement: Good but Incomplete

December 15, 2021 / / 0 Comments

David Collins

As the UK continues to establish its own trade policy, it is vital that legal services, which provide more than £60 billion per year to the UK’s economy, are paid sufficient attention in trade negotiations. UK legal expertise is high demand around the world and the service of international clients is a key source of revenue for many UK lawyers. Lawyers rely on the possibility of short-term visits to foreign jurisdictions for the purposes of providing legal advice (sometimes described as fly-in fly-out, or FIFO) as well as temporary secondment/establishment rights in a jurisdiction. While there are many lucrative, fast-growing markets in Asia, the ability for lawyers to continue to provide advice in these ways in the EU is an issue of some importance. The Lawyer’s Establishment Directive ceased to apply to UK lawyers at the end of the transition period. Today UK lawyers seeking to provide legal advice in the EU must deal with 27 separate regulatory regimes.

Fortunately, the principle of home title practice was recognised in the EU-UK Trade and Cooperation Agreement (TCA), finalized at the end of last year. It should be pointed out that the inclusion of any material on legal services in a Free Trade Agreement is in itself a achievement since historically they have been ignored in international negotiations, with the Comprehensive Progressive Trans-Pacific Partnership (CPTPP) and the agreement in principle between the UK and Australia other notable exceptions. Under the home title principle, parties to the TCA agree to permit practice by lawyers of the other party under their home jurisdiction professional qualification with regards to advice on home country and public international law, as well as arbitration, conciliation and mediation. On their own these are already sizable areas of the legal services market for most UK lawyers serving clients in the EU.
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The CPTPP as a New Regime for World Trade?

October 1, 2021 / / 0 Comments

David Collins

Formal talks on the UK’s accession to the 11-nation Comprehensive Progressive Trans-Pacific Partnership (CPTPP) began this week after several months of preliminary negotiations. The fast-growing Asia-Pacific region served by the CPTPP promises to eclipse the economic activity of the rest of Europe, if not the world, well into the 21st Century. More than that, the CPTPP may be poised to establish itself as a near-global regime for trade governance in conjunction, or perhaps in competition with the 164 nation World Trade Organization (WTO). Covering matters such as tariff and non-tariff barriers on goods, market access for services, intellectual property and subsidies like the WTO, the CPTPP also has rules on digital trade and investment which the 26-year-old WTO, with all of the problems associated with needing global consensus, does not. Whereas momentum in multilateral trade liberalisation has stalled in recent years with little to no progress on the key issues of agricultural subsidies, fisheries or dispute settlement, interest in the CPTPP is picking up speed. Continue reading

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