Having encountered insufficient resistance, the Court of Justice predictably moved from undermining the foundations of the international legal order to what Carl Schmitt described as the subordination of law to abstract value-based imperatives.
A vivid example is the recent 2025 judgment in Commission v Malta.
The Court applied Article 2 of the Treaty on European Union
to restrict national competence in matters of citizenship, disregarding Declaration No. 2 annexed to the Treaty on European Union
, which explicitly states that questions of citizenship fall exclusively within national jurisdiction. In other words, the Court of Justice triumphantly declared that any provision may be subordinated to the “values of the Union”, the vague nature of which was elevated above clear treaty norms.
The special status of the Court of Justice’s rulings within the system of sources of EU law, combined with the absence of substantive limits on what constitutes permissible interpretation, has given rise to a “juristocracy”
, which systematically constructs a “flourishing garden”—this time in the legal domain—at the expense not only of the already fragile authority of international law, but also of its own image as a bastion of universal principles of the rule of law and legality, where legal certainty remains intact only with regard to the inviolability of the autonomy of the EU legal system.
The Decline of Investment Arbitration and the Sanctions Leviathan
Turning from the genesis of the European Union’s legal self-identification to its practical consequences, one cannot ignore the current state of investment arbitration, which is undergoing an unprecedented crisis. This fragile mechanism—urgently in need of reform, yet still the only existing means of protecting foreign investments—now appears destined to become a relic of the past. The institutions of the EU have played no small part in bringing about this dismal state of affairs. There lies a far more prosaic explanation behind the high-profile declarations about the need to protect the Union’s legal system from foreign commercial practices—among which investment arbitration, in the sense of the 1965 Washington Convention,
is included. By the early 2020s, EU Member States had become respondents in investment claims amounting to billions of euros. Germany, France, Italy, Spain, and others faced claims from foreign investors who had either failed to receive, or had entirely lost, their expected profits as a result of regulatory measures adopted by the Commission and other institutions—from the phase-out of nuclear energy to the reduction of “green” subsidies in the renewable energy sector. It is evident that, in Brussels’ view, ad hoc arbitration—which allows the parties to participate in the appointment of arbitrators, a feature regarded as an advantage in commercial arbitration but as more of an obstacle in disputes involving states—could pose a threat to the Union and to its ambitions to become the sole regulator of investment activity both internally and in its relations with third-country investors.
In 2018, in the Achmea case,
the Court of Justice held that investment arbitration not integrated into the Union’s judicial system might interpret EU law differently from Luxembourg, thereby encroaching upon the much-vaunted autonomy of the EU legal order. In 2021, the Komstroy case
extended this logic to the Energy Charter Treaty, declaring Article 26—providing for investor–state arbitration—inapplicable to disputes involving EU Member States. This case offers a clear illustration of the European Union’s double standards towards third countries, particularly when it comes to Russia—especially in the context of the Yukos case. While Brussels systematically restricts arbitration mechanisms within the Union, it simultaneously uses them as an instrument of pressure against external opponents.
Moreover, a systematic campaign against alternative dispute resolution mechanisms is also being pursued by the Council of the European Union. Following several multi-billion claims—Mikhail Fridman v Luxembourg
($16 billion) and OJSC Belaruskali v Lithuania
($12 billion)—Brussels has, retrospectively and in breach of legal certainty, significantly curtailed the ability of investors from third countries to protect their rights and access the justice system, justifying this by the need to counter Russia. This approach is reflected in the 18th sanctions package
, which explicitly prohibits the recognition and enforcement of any arbitral awards rendered outside the EU in investment disputes involving individuals or entities subject to sanctions. Even ICSID awards fall under this prohibition; the EU is de facto nullifying Member States’ obligations under Article 54 of the Washington Convention. The regulation also permits Member States to seek damages from sanctioned individuals who have initiated proceedings (sic!) based on generally recognised principles of international investment law.
Nevertheless, in this area the autonomy of the EU legal order has encountered strong resistance from the global majority, including Western states. In 2026, the Singapore International Commercial Court, in DNZ v DOA, refused to set aside an arbitral award against Poland, noting that the primacy of EU law applies “only within the EU system, and not on the broader international plane”. A Swiss court, in EDF v Spain,
upheld the validity of an arbitral award in favour of the energy company and rejected Spain’s objections, stating that rulings of the Court of Justice do not take precedence outside the EU and that the Energy Charter Treaty does not exclude intra-EU disputes.
‘And if a Law Hinders the Development of the Revolution, It Is to Be Abolished or Amended…’
In 1964, the doctrine of the autonomy of EU law emerged as an instrument for shielding the integration project from the political contingencies of Member States. Today, however, it has become one of the drivers of the degradation of the international legal order. The European Union, which for decades accused other states of selective approaches to international law and double standards, has itself cultivated a system in which previously assumed obligations are observed only insofar as they do not conflict with political expediency. This trend can be traced from the earliest judgments of the Court of Justice to contemporary sanctions packages that selectively nullify Member States’ obligations under the Washington Convention. The problem is systemic, given that international law operates in the absence of a coercive enforcement apparatus. Its effectiveness depends on good faith among states and on legal certainty. The irony of history lies in the fact that the European Union, which emerged in part as an alternative to national egoism, has reproduced it in its most absolute form.
The Valdai Discussion Club was established in 2004. It is named after Lake Valdai, which is located close to Veliky Novgorod, where the Club’s first meeting took place.
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