European Commission launches infringement proceedings against the UK and Finland

The European Commission has launched infringement proceedings against the UK and Finland as a result of their decision not to sign the multilateral treaty terminating intra-EU BITs (Treaty).  On 5 May 2020, 23 of the 28 EU Member States signed the Treaty. On 14 May 2020, the Commission announced that it had sent to the UK and Finland a letter of formal notice, the first step in the infringement process.

In its announcement, the Commission states that it “regrets” that the UK and Finland did not sign the Treaty and has urged them to take all necessary actions to urgently remove intra-EU BITs from their legal order, bearing in mind their incompatibility with Union law. The UK, whilst having entered into the Withdrawal Agreement to leave the EU, continues to apply EU law during the transition period.  Due to the impact of covid-19 on national administrations, the UK and Finland now have four months (rather than the usual two months) to provide a satisfactory response to the letters of formal notice, failing which the Commission may decide to address reasoned opinions.

The Commission launched infringement proceedings against Austria and Sweden in 2015 and issued reasoned opinions in 2016. Ireland, the other State not to sign the Treaty, terminated its only intra-EU BIT, with the Czech Republic, in 2011.

Fietta will continue to provide updates on future steps taken in connection with the Treaty.

An earlier update on the signing of the Treaty is available here.