Proposal for a COUNCIL DECISION on the position to be taken on behalf of the European Union at the Extraordinary Conference of the Energy Charter Treaty on 24th June 2022
Date: 2022-06-13
Institutions: Directorate-General for Energy, European Commission
Subjects: Belarus, Russia, energy cooperation, energy policy, international charter, multilateral agreement, observer, revision of an agreement, withdrawal from an agreement

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   EUROPEAN COMMISSION  Brussels, 13.6.2022  COM(2022) 293 final 2022/0191 (NLE)  Proposal for a COUNCIL DECISION on the position to be taken on behalf of the European Union at the Extraordinary Conference of the Energy Charter Treaty on 24th June 2022  
 
EXPLANATORY MEMORANDUM 

1. 

SUBJECT MATTER OF THE PROPOSAL 

This  proposal  concerns  the  decision  establishing  the  position  to  be  adopted  on  the  Union's 
behalf  in  the  Extraordinary  Conference  of  the  Energy  Charter  Treaty  on  24th  June  2022  in 
Brussels with several acts to be adopted related to the following: (i) amendment of the Rules 
of  Procedure  of  the  Energy  Charter  Conference,  (ii)  withdrawal  of  Russian  Federation’s 
Status as an Observer to the Conference, and (iii) suspension of the provisional application of 
the  ECT  in  relation  to  Belarus  and  suspension  of  Belarus  as  an  Observer  to  the  Energy 
Charter Treaty (hereafter ‘ECT’). 

2. 

CONTEXT OF THE PROPOSAL 

2.1. 

The Energy Charter Treaty (ECT) 

The  ECT  is  a  multilateral  trade  and  investment  agreement  applicable  to  the  energy  sector, 
signed by the EU in December 1994 and entered into force in April 1998. The Treaty consists 
of provisions on protection of investments, trade in energy materials and products, transit and 
dispute settlement. The ECT also sets up a framework for international cooperation between 
55  Contracting  Parties  (including  the  EU  and  EURATOM,  27  EU  Member  States1,  Japan, 
Switzerland, Turkey, most countries of the former USSR, except for the Russian Federation2 
and some countries in the Western Balkans).  

The  ECT  was  originally  set  up  as  a  framework  for  international  cooperation  between 
European countries and other industrialised countries with the aim of developing the energy 
potential  of  Central  and  Eastern  European  countries  and  of  ensuring  the  security  of  energy 
supply for the EU. 

The  key  provisions  of  the  Treaty  concern  the  protection  of  investment,  trade  in  energy 
materials and products, transit and dispute settlement. 

All states or Regional Economic Integration Organisations who have signed or acceded to the 
Treaty  are  members  of  the  Conference,  which  meets  on  a  regular  basis  to  discuss  issues 
affecting energy cooperation among the Treaty's signatories, to review the implementation of 
the  provisions  of  the  Energy  Charter  Treaty  and  the  Protocol  on  Energy  Efficiency  and 
Related Environmental Aspects, and to consider possible new instruments and joint activities 
within the Energy Charter framework. 

The Energy Charter Conference ensures that the objectives set out in the ECT are attained. It 
facilitates  in  accordance  with  this  Treaty  and  the  Protocols  the  coordination  of  appropriate 
general measures to carry out the principles of the Charter.  

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Italy  was  a  Contracting  Party  but  withdrew  in  2015.  Officially,  the  Italian  government  explained  its 
decision  with  cutting  the  costs  of  its  membership  in  international  organisations  due  to  budget 
restrictions. 
The Russian Federation signed the ECT, but took the formal decision not to ratify it. 

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Each  Party  has  one  vote  and  the  Energy  Charter  Conference  acts  by  different  voting  rules 
depending on the subject matter.  

The present proposal for a decision under Article 218 (9) TFEU concerns the position to be 
taken on the Union's behalf to the envisaged acts in the Energy Charter Conference.  

2.2. 

Position to be adopted on the Union's behalf 

2.2.1. Amendment of the Rules of Procedure of the Energy Charter Conference 

At  the  meeting  on  7  April  2022,  the  ECT  Management  Committee  recommended  the 
Conference to consider the approval of the amendment to the Rules of Procedure to provide 
for  the  potential  withdrawal  or  suspension  of  the  observer  status  of  a  state  or  international 
organisation  under  certain  circumstances.  Article  36  (“Voting”)  of  the  ECT  applies  only  to 
decisions provided in the Treaty, while the Observer status to the Energy Charter Conference 
is  partly  regulated  in  the  Rules  of  Procedure  of  the  Energy  Charter  Conference.  Thus,  it  is 
suggested  to  add  the  following  wording  to  the  proposed  new  subparagraph  (e)  to  cover  the 
case  of  potential  withdrawal  or  suspension  of  an  observer  and  clarify  the  respective  voting 
rules: 

’III. OBSERVERS 

Rule 7 

A. General rules 

‘‘[…] (e) The Conference may, by consensus, suspend or withdraw the Observer status of a 
country or international organisation in case of 

persistent  or  serious  breach  of  the  principles  of  the  European  Energy  Charter  or  the 
International  Energy  Charter,  whichever  was  signed  by  that  country  or  international 
organisation, or 

persistent failure to comply with financial obligations it may have towards the International 
Energy Charter. 

If consensus cannot be reached, the decision of the Conference under this subparagraph shall 
be  taken  by  a  three-fourths  majority  of  the  Contracting  Parties  Present  and  Voting  at  the 
meeting  of  the  Conference,  as  far  as  they  represent  a  simple  majority  of  the  Contracting 
Parties.’’ 

The Working Group on Governance Issues on 16 May 2002 recommended to put forward for 
Conference’s  approval  by  correspondence  by  5  June  the  above  proposed  amendment  (CC 
742)  taking  into  consideration  the  conclusions  of  the  Management  Committee  (Message 
1952)]. 

This  Energy  Charter  Conference  decision  adapts  the  recommendations  made  by  the 
Management Committee and the Working Group on Governance Issues on 7 April 2022 and 
16 May 2022 respectively on amending Rule 7 of the Rules of Procedure. 

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According to Section VIII of the Final Act of the European Energy Charter Conference, the 
Energy Charter Conference is responsible for making decisions on requests to sign the 1991 
political declaration. Decisions on this matter have so far been taken by consensus. 

In view of the above, the position to be taken on behalf of the Union in the  Energy Charter 
Conference should be to confirm the amendment. 

2.2.2.Withdrawal of Russian Federation’s status as an Observer to the Conference 

The EU should support the withdrawal of the observer status of the Russian Federation based 
on the approval of the amended procedural Rule 7 justified on both of its grounds (violation 
of principles and failure to comply with any financial obligation). 

2.2.3.Suspension of the provisional application of the ECT in relation to Belarus 

During its meeting on 28 April and 2 June 2022, the Management Committee continued the 
discussion  on  the  suspension  of  the  provisional  application  of  the  Energy  Charter  Treaty 
(ECT), as requested by Ukraine. 

The  action  of  the  Belarus  allowing  Russia  to  use  its  territory  to  facilitate  the  aggression 
against Ukraine’s nuclear power plants together  with  its radioactive waste storage facilities, 
gas transportation system , coal mines , hydropower plants and oil refineries  and deposits can 
be considered a material breach (“the violation of a provision essential to the accomplishment 
of the object or purpose of the treaty” [Article 60.3.b of Vienna Convention on the Law of the 
Treaties, VCLT]) of Articles 3, 7, 18 and 19 of the ECT. 

The  Contracting  Parties  represented  in  the  Energy  Charter  Conference  will  be  invited  to 
decide  (i)  to  suspend  the  provisional  application  of  the  ECT  in  relation  to  Belarus,  (ii)  to 
request the Energy Charter Secretariat to inform the Depositary and Belarus formally and (iii) 
to suspend the Observer status of Belarus. 

The  EU  should  support  to  suspend  the  provisional  application  of  the  ECT  in  relation  to 
Belarus,  and  request  Energy  Charter  Secretariat  to  formally  inform  the  Depositary  and 
Belarus. The EU should also support to suspend the observer status of Belarus.  

3. 

LEGAL BASIS 

3.1. 

Procedural legal basis 

3.1.1.  Principles 

Article 218 (9) TFEU provides for decisions establishing ‘the positions to be adopted on the 
Union’s behalf in a body set up by an agreement, when that body is called upon to adopt acts 
having  legal  effects,  with  the  exception  of  acts  supplementing  or  amending  the  institutional 
framework of the agreement. 

The concept of ‘acts having legal effects’ includes acts that have legal effects by virtue of the 
rules of international law governing the body in question. It also includes instruments that do 

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not  have  a  binding  effect  under  international  law,  but  that  are  ‘capable  of  decisively 
influencing the content of the legislation adopted by the EU legislature’3. 

3.1.2.  Application to the present case 

The Energy Charter Conference is a body set up by an agreement, namely the Energy Charter 
Treaty. 

The envisaged  acts,  which the  Energy Charter Conference of the Energy Charter  Treaty are 
called upon to adopt, constitute acts having legal effects. The amendment of voting issues of 
the  Energy  Charter  Conference  has  binding  force  at  least  on  the  institutions  of  the  Energy 
Charter Treaty.  

Also the withdrawal of Russian Federation’s status as an Observer as well as the suspension 
of the provisional application of the ECT in  relation  to  Belarus have legally binding  effects 
and therefore apply to Article 218 (9) TFEU, because they have an influence on the concrete 
composition of the Energy Charter Treaty. 

The  envisaged  acts  do  not  supplement  or  amend  the  institutional  framework  of  the 
Agreement. 

Therefore, the procedural legal basis for the proposed decisions is Article 218 (9) TFEU. 

3.2. 

Substantive legal basis 

3.2.1.  Principles 

The substantive legal basis for a decision under Article 218 (9) TFEU depends primarily on 
the objective and content of the envisaged act in respect of which a position is taken on the 
Union's behalf.  If the  envisaged act  pursues two  aims or has two components and if one of 
those  aims  or  components  is  identifiable  as  the  main  one,  whereas  the  other  is  merely 
incidental, the decision under Article 218 (9) TFEU must be founded on a single substantive 
legal basis, namely that required by the main or predominant aim or component. 

3.2.2.  Application to the present case 

The main objective and content of the envisaged acts relate to energy. 

Therefore, the substantive legal basis of the proposed decision is Article 194 TFEU. 

3.3. 

Conclusion 

The  legal  basis  of  the  proposed  decision  should  be  Article  194,  in  conjunction  with  Article 
218(9) TFEU. 

3 

Judgment  of 
ECLI:EU:C:2014:2258, paragraphs 61 to 64.  

the  Court  of  Justice  of  7  October  2014,  Germany  v  Council,  C-399/12, 

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2022/0191 (NLE) 

2022/ () 

Proposal for a 

COUNCIL DECISION 

on the position to be taken on behalf of the European Union at the Extraordinary 
Conference of the Energy Charter Treaty on 24th June 2022 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 194, in conjunction with Article 218(9) thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

The  Energy  Charter  Treaty  (‘the  Agreement’)  was  concluded  by  the  Union  by 
Decision 98/181/EC, ECSC, Euratom and entered into force in 1998. 

Pursuant  to  Articles  34  of  the  Agreement,  the  Energy  Charter  Conference  ensures 
that the objectives set out in the ECT are attained. It facilitate in accordance with this 
Treaty  and  the  Protocols  the  coordination  of  appropriate  general  measures  to  carry 
out the principles of the Charter. 

The  Energy  Charter  Conference,  during  its  Extraordinary  meeting  on  24th  of  June 
2022,  is  to  adopt:  (i)  amendment  of  the  Rules  of  Procedure  of  the  Energy  Charter 
Conference,  (ii)  withdrawal  of  Russian  Federation’s  Status  as  an  Observer  to  the 
Conference, and (iii) suspension the provisional application of the ECT in relation to 
Belarus and the suspension as observer to the ECT. 

HAS ADOPTED THIS DECISION: 

Article 1 

The  position  to  be  taken  on  the  Union's  behalf  in  the  Extraordinary  Energy  Charter 
Conference meeting of the Energy Charter Treaty on 24th June 2022 in Brussels shall be the 
following: 

to confirm the proposed amendment of the Rule 7. 

to  approve  the  withdrawal  of  the  observer  status  of  the  Russian  Federation  based  on  the 
approval  of  the  amended  procedural  Rule  7  justified  on  both  of  its  grounds  (violation  of 
principles and failure to comply with any financial obligation). 

to approve the suspension of the provisional application of the ECT in relation to Belarus and 
Belarus’ observer status. 

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This Decision is addressed to the Commission. 

Article 2 

Done at Brussels, 

For the Council 
The President 

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