BREXIT AND INVESTMENT TREATY ARBITRATION By Wojciech Sadowski (Warsaw) In this insight we consider the current and potential effects of Brexit on investment treaty arbitration. The likely implications concern the negotiations of the trade and investment agreements between the European Union and certain third countries, the approach of the European Commission (the “Commission”) to intra-European bilateral investment treaties, the possible role of the United Kingdomas a potential hub for investment corporate structures and the possible emergence of treaty claims against the United Kingdom. The analysis necessarily requires more mapping of alternatives as political decisions will have a material bearing on the possible outcomes. BREXIT AND TRADE TREATIES The United Kingdom’s exit from the EU will undoubtedly have an impact on negotiations of trade and investment agreements that are being held between the European Union and those states that have particular business or historic ties with the United Kingdom, such as Canada (CETA), the United States (TTIP) or India. It is likely that some of the already agreed provisions would need to be renegotiated. FUTURE OF THE INTRA-EUROPEAN BILATERAL INVESTMENT TREATIES Following the entry into force of the Lisbon Treaty, the Commission took the stance that bilateral investment treaties concluded between Member States of the EU are generally inconsistent with the law of the European Union and should be terminated. More recently, the Commission has intensified its efforts in this area, e.g., calling on certain Member States to terminate their investment treaties with other Member States of the EU. These requests have met with various reactions from different Member States. It is thus conceivable that Brexit would impact the dynamics between the Commission and these Member States. Faced with this unprecedented vote against the trend towards the ever-closer 28 | K&L Gates: ARBITRATION WORLD