The Supreme Court raised the question of whether the principles laid down by the Court of Justice of the European Union in a previous ruling not only invalidate an arbitration clause under a so-called intra-EU investment agreement, but also prohibit an investor and a Member State from concluding, through their conduct in the proceedings, an arbitration agreement under the same conditions as under the investment agreement for a particular dispute.
Following a request of a preliminary ruling by the Supreme Court on this issue, the CJEU concluded that Articles 267 and 344 of the Treaty on the Functioning of the European Union must be interpreted as precluding national legislation which allows a Member State to conclude a specific arbitration agreement with an investor from another Member State, that makes it possible to continue the arbitration proceedings initiated on the basis of an invalid arbitration clause under an investment agreement.
The question remained of whether the preliminary ruling should be set aside or declared invalid under the Arbitration Act. The Supreme Court held that the award was invalid in view of the fact that the manner in which it arose was manifestly incompatible with the fundamental principles of Swedish law.
Case No: T 1569-19
Cecilia Andgren, Judge referee
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