The Rise of the Sunset Clause

Presentation

The Rise of the Sunset Clause

The recent spike in the number of investment arbitrations and the growing dissatisfaction with the ISDS system in general have led certain States to amend, suspend or terminate their BITs and other investment promotion instruments to avoid further liability.

As of the late 2010s, Bolivia, Ecuador, South Africa, India, Indonesia and Venezuela – to name a few – decided to terminate some or all of their BITs. Bolivia, Venezuela and Ecuador went even further, denouncing the ICSID Convention. The wind has blown over Europe too. In the context of the Achmea and Komstroy saga, several EU Member States recently withdrew from the Energy Charter Treaty, suddenly halting the ECT’s modernization process. The European Commission has recently proposed a collective and coordinated exit of all 27 EU Member States.

This has shed new light on several post-termination liability mechanisms, the first of which being the so-called “sunset” or “survival” clause. This tool extends investment protection beyond the termination of a treaty for an additional period of time and thus prolongs the State’s exposure to potential arbitration claims. While ensuring the protection of investors’ legitimate expectations, it also added grist to the mill of investment arbitration critics and fueled the ongoing debate on ISDS legitimacy.

As part of the 2023 edition of the Paris Arbitration Week, Audit Duprey Fekl is pleased to invite you to a breakfast roundtable on this topic, to be hosted at the Cercle de l’Union Interalliée.

Our distinguished panel will feature:
- Alejandro Carballo Leyda, General Counsel and Head of the Conflict Resolution Centre at the Office of the Secretary-General of The Energy Charter Treaty;
- Nicolas Angelet, Professor of International Law at the Université Libre de Bruxelles, Counsel and Arbitrator;
- Noah Rubins KC, Partner at Freshfields Bruckhaus Deringer LLP; and
- Mathias Audit, Professor at the Sorbonne School of Law, Founding Partner at Audit Duprey Fekl.

The panel will be moderated by Matthias Fekl, former French Minister, former French Secretary of State for Foreign Trade, Founding Partner at Audit Duprey Fekl.