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This chapter investigates investment relationships in a pre-dispute context and provides a detailed overview of investment screening mechanisms under European Union (EU) law. Specifically, the chapter notes that while investment screening is an important tool, it must be properly calibrated to take sustainable development into consideration. From there, the work identifies a nascent EU framework for Member State screening of foreign direct investment (FDI) which focuses on national security and public order. It also provides detailed analysis under EU law concerning the question of whether environmental protection falls within those categories. Overall, this chapter provides discussion and insight concerning the interplay between screening mechanisms, sustainable development and EU law.

In January 2024, the Commission unveiled its proposal for a revised foreign direct investment (FDI) Screening Regulation. While the proposal does not openly question the Member States' final say in screening decisions, the mechanism for administrative cooperation would be considerably enhanced compared to the current legislative framework. The paper assesses in how far the changes to the cooperation mechanism under the Commission proposal may contribute to Europeanization of FDI screening. It argues that the proposal fits into the geo-economic turn of the Union. At the same time, it showcases the limits the Union's status quo poses to reacting adequately to the ongoing geopolitical upheavals. Underlying the Commission proposal is a considerable reliance on the effectiveness of political peer pressure and soft law instruments, instead of hard regulation. Given that the Commission proposal is largely a middle ground between the negotiating positions of the Parliament and the Council in the current ongoing trilogue, it is not unlikely that this is where we will end up.

The analysis of investment and the EU internal market requires a discussion of both capital and establishment, two key concepts that shape economic activity within the EU, but also when it comes to the external dimension of the internal market. This chapter throws a spotlight on what is left of the ‘freedom to invest’ in the age of geoeconomics and rampant security thinking. It does so by assessing whether the EU Screening Regulation has increased the Member States’ leeway to interfere with third state investment beyond the limits stipulated essentially by the fundamental freedoms. The chapter argues that, as the law stands today, there is a tension between Article 63(1) TFEU and the current restrictive legislative activities of the EU and its Member States. This is precisely because these recent measures, which undoubtedly have protectionist features, are being enacted in a legal environment that is a prominent expression of an EU based on a non-protectionist economic order with an open market. However, apart from the exceptions contained in the chapter on the free movement of capital, the case law of the Court of Justice on this freedom has traditionally followed the prevailing political views in the EU on the ‘acceptable’ degree of openness with regard to the movement of capital from third countries. In other words, it would not be surprising if the Court were to ‘evolve’ its case law to better reflect the current ‘sovereignty preservation’ trend.

Zusammenfassung: This volume offers cutting-edge research aimed at developing a comprehensive analytical foundation for the interdisciplinary field of investment control and national security. It delves into legal, regulatory, and geopolitical aspects of investment screening, particularly from international, transnational, and comparative law perspectives. This work explores how countries navigate the balance between protecting national security and fostering foreign direct investment in an increasingly complex global environment  

The fifth volume of the Yearbook of Socio-Economic Constitutions (YSEC Yearbook) offers an in-depth exploration of socio-economic constitutionalism, a field gaining rapidly in importance as global economies shift. Established equilibria between economic freedoms and socio-political interests are under pressure. This volume addresses contemporary issues, illustrating the balances between constitutional principles, economic goals, and socio-political values. Bridging theory and practice, it begins with foundational theories, advances through national applications, and concludes with global challenges. At its core is the socio-economic constitution, with authors examining how different jurisdictions interpret and apply this concept. The initial chapters lay a theoretical foundation. The volume then explores national approaches (Belgium, France, Germany, South Africa, South Korea, Sweden, Switzerland and also the EU), showcasing how countries adapt socio-economic constitutional principles to their historical, cultural, and legal contexts. The volume explores then the interplay of different constitutional interests at EU and international level, e.g., the EU’s balancing act between sustainability and consumer welfare when it comes to competition law or foreign investment screening at the intersection of economic security and national sovereignty. By moving from theory to national models and global issues, this YSEC volume offers a comprehensive contemporary view of socio-economic constitutionalism. It illustrates how constitutions are evolving to address today’s challenges, blending economic, social, and environmental concerns within a constitutional framework. This work is essential for readers seeking to understand how socio-economic constitutional principles can bridge theory and practice in today’s world.

This chapter reviews the basic principles of the mechanisms that govern the life of an award in investor-state dispute settlement (ISDS) after it was rendered, in particular annulment and set-aside. It analyses the similarities and differences between the two review procedures in terms of preserving the finality of an award as an essential feature of ISDS, while considering competing policy considerations. It first examines annulment according to Article 52 of the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention) and the performance of the ad hoc committees in their role as guardians of both the arbitral process and the finality of awards. It then briefly compares this ‘tailor-made’ review mechanism with the set-aside procedure for non-ICSID awards under domestic arbitration law at the seat of arbitration in domestic courts. Finally, the chapter reflects on the general increase in challenges to awards in recent years and the implications for ‘finality’ in ISDS.

On 1-3 June 2022, the Common European Law on Investment Screening (CELIS) Institute organized its fourth annual conference '2022 CELIS Forum on Investment Screening' (CFIS22). The Conference was held in Sweden, at Uppsala University. The CELIS Institute is an independent non-profit, non-partisan research enterprise dedicated to promoting better regulation of foreign invest-ments in the context of security, public order, and competitiveness. It was set up in 2020 by Steffen Hindelang and J. Hillebrand Pohl, the convenors of this year's conference, as a permanent successor to the 'International Conference on a Common European Law on Investment Screening (CELIS)', convened by Professor Hindelang and Andreas Moberg in 2019. The aim of CFIS 22 was to debate European investment screening on national security grounds from a strategic perspective on the theme 'The Emerging Law of Investment Control in Europe: Screening, Sanctions and Subsidies'. CFIS was a major event which brought together, not just leading academic scholars, EU officials, national experts, diplomats, and policymakers, but also business leaders, think tankers, and representatives of the investment community and civil society, as well as the media from across Europe and beyond. The three-day event was generously funded by Riksbankens jubileumsfond, the Center for International Private Enterprise, the Swedish Institute of International Law, Datenna, Blomstein, and the Institute for Democracy Societas Civilis - Skopje. This report summarizes the conference proceedings.

This contribution investigates whether international investment law and its substantive protection standards could entail potential risks in relation to the rule of law’s normative foundations informed by human rights and sustainable development. Answering this in the affirmative, it identifies such risks and finds that risks could be mitigated through treaty interpretation and the principle of systemic integration of relevant international commitments. An empirical study of selected decisions where human rights of others than investors, or sustainable development concerns, were at stake gives on the one hand indications of an increasing awareness and application of such systemic integration. On the other hand, however, it reveals ambiguities and unevenness in the decisions of investment tribunals when addressing human rights and sustainable development issues. The concluding discussion also addresses whether the more recent trend towards specific mentions of human rights and sustainable developments concerns in international investment agreements, or current attempts to settle investor-State disputes in a multilateral framework will solve the issue.