EU – Baltic States, Investments, Latvia, Legislation
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Friday, 29.03.2024, 15:06
Latvia to terminate investment treaties with Poland, Czech Republic at EU request
The Latvian Foreign Ministry explained that in 2009 the European Commission
for the first time pointed out that bilateral investment treaties between
member states (intra-EU BITs) were incompatible with EU law because they
overlapped and conflicted with the EU regulatory framework applicable to
cross-border investments therefore those treaties should be terminated.
Later the European Commission started an infringement procedure against
five member states (Austria, the Netherlands, Romania, Slovakia and Sweden) and
initiated the pre-infringement procedure against other member states, including
Latvia, requesting information about compliance of the BITs with the EU law and
inquiring about their willingness to terminate those treaties.
The Polish and Czech governments agree with the European Commission and
have offered to Latvia to terminate the agreements on promotion and reciprocal
protection of investments that were signed in 1993 and 1994 respectively.
Before the termination the agreements have to be amended to remove a
provision stating that the agreement will continue in force for ten years after
the termination, thus precluding a lasting breach of the EU regulations.
It is planned that the bilateral investment agreements with Poland and the
Czech Republic will be terminated in three months after the completion of all
the formalities.