Order of 23 July 2024

R e a s o n s:

1

The constitutional complaint is directed at an order of the Federal Court of Justice (Bundesgerichtshof) that set aside an arbitral award during a review procedure in accordance with § 1059 of the Code of Civil Procedure (Zivilprozessordnung - ZPO). The arbitral award had granted damages to the complainant in the amount of around EUR 22 million in a legal dispute with the Slovak Republic on the basis of provisions in a bilateral investment treaty. With this constitutional complaint, the complainant challenges the order setting aside the arbitral award.

I. 

2-13

[…]

[Excerpt from Press Release No. 77/2024 of 13 September 2024]

In 1991, the Kingdom of the Netherlands and the Czech and Slovak Federative Republic concluded the Agreement on encouragement and reciprocal protection of investments (hereinafter: the Treaty). Art. 8 of the Treaty submits any dispute arising under the Treaty to an arbitral tribunal (arbitration clause). In 1993, the Slovak Republic succeeded to the Treaty in place of the Czech and Slovak Federative Republic. The Slovak Republic has been a member of the European Union since 2004.

The complainant, a Dutch insurance group, had a subsidiary in the Slovak Republic offering private health insurance. In 2007, the Slovak Republic prohibited the distribution of profits generated by health insurance activities. In 2011, the Slovak Constitutional Court declared this ban unconstitutional and the distribution of profits was again permitted.

In 2008, the complainant initiated arbitration proceedings against the Slovak Republic under Art. 8 of the Treaty, seeking damages for the ban on profit distributions. The arbitral tribunal chose Frankfurt am Main as the seat of arbitration and, by arbitral award of 7 December 2012, ordered the Slovak Republic to pay damages amounting to EUR 22.1 million. By order of 18 December 2014, the Frankfurt am Main Higher Regional Court (Oberlandesgericht) rejected the application to set aside the arbitral award. The Federal Court of Justice suspended the proceedings and requested a preliminary ruling from the Court of Justice of the European Union on the question of whether arbitration clauses, such as the one under Art. 8 of the Treaty, were compatible with EU law. By judgment of 6 March 2018 (Achmea Judgment), the Court of Justice of the European Union ruled that arbitration clauses in international agreements between EU Member States like the one in Art. 8(2) of the Treaty are incompatible with Arts. 267, 344 of the Treaty on the Functioning of the European Union (TFEU). By order of 31 October 2018, the Federal Court of Justice reversed both the decision of the Higher Regional Court and the arbitral award. In its reasoning, the Federal Court of Justice stated that no arbitration agreement existed between the parties and, consequently, the arbitral award must be reversed under § 1059(2) no. 1 letter a of the Code of Civil Procedure. The Federal Court of Justice held that the arbitration clause under Art. 8(2) of the Treaty was not applicable because of its incompatibility with Arts. 267 and 344 TFEU.

On 5 May 2020, 23 EU Member States – including the Federal Republic of Germany, the Slovak Republic and the Kingdom of the Netherlands – signed the Agreement for the termination of Bilateral Investment Treaties between the Member States of the European Union (hereinafter: the Termination Agreement). Pursuant to Art. 4(2) in conjunction with Art. 16(2) of the Termination Agreement, bilateral investment treaties to which the Termination Agreement applies are terminated if ‘the relevant Contracting Parties’ have ratified, approved or accepted the Termination Agreement. The Treaty is included in the list of terminated treaties in an annex to the Termination Agreement. Slovakia and the Netherlands ratified the Termination Agreement. On 19 November 2020, the German Bundestag adopted the act of approval to the Termination Agreement. The Federal Constitutional Court dismissed an application for preliminary injunction that the complainant lodged to prevent the act of approval from entering into force (cf. Press Release No. 13/2021 of 3 February 2021, in German). The act of approval entered into force on 22 January 2021.

[End of excerpt]

14

The complainant’s challenge of the act of approval […] is the subject matter of separate constitutional complaint proceedings.

II. 

15

With their constitutional complaint, submitted in time, the complainant claims a violation of their rights under Art. 2(1), Art. 3(1), Art. 12(1), Art. 14(1), Art. 19(4), Art. 2(1) in conjunction with Art. 20(3), Art. 23 in conjunction with Art. 79(3), Art. 101(1) second sentence and Art. 103(1) of the Basic Law (Grundgesetz – GG).

16-25

[…]

III. 

26

1. The Slovak Republic submitted a statement in the constitutional complaint proceedings.

27-32

[…]

33

2. The Federal Government also submitted a statement.

34-36

[…]

37

3. The complainant responded to the statements submitted by the Slovak Republic and the Federal Government. Both the Slovak Republic and the Federal Government subsequently submitted additional statements.

38

[...]

IV. 

39

The constitutional complaint is not to be admitted for decision as the prerequisites for admission pursuant to § 93a(2) of the Federal Constitutional Court Act (Bundesverfassungsgerichtsgesetz – BVerfGG) are not met. The constitutional complaint does not have general constitutional significance, nor is admission for decision appropriate to enforce the rights of the complainant as laid down in § 90(1) of the Federal Constitutional Court Act. The constitutional complaint is inadmissible. The complainant fails to sufficiently substantiate a recognised legal interest (see 1. and 2. below). The complainant also fails to sufficiently demonstrate a violation of constitutional law (see 3. below).

40

1. Firstly, the complainant fails to sufficiently demonstrate a recognised legal interest insofar as their constitutional complaint also challenges the order of the Federal Court of Justice of 24 January 2019, which rejected their complaint of a violation of their right to be heard. Orders rejecting a complaint of a violation of the right to be heard can only be challenged independently through a constitutional complaint if such rejection results in adverse constitutional effects that are separate from the decision in the underlying case (cf. Decisions of the Federal Constitutional Court, Entscheidungen des Bundesverfassungsgerichts – BVerfGE 119, 292 <294 ff.>; Chamber Decisions of the Federal Constitutional Court, Kammerentscheidungen des Bundesverfassungsgerichts – BVerfGK 13, 496 <498>). The complainant fails to demonstrate that this is the case here.

41

2. Regarding the order of the Federal Court of Justice by which it set aside the arbitral award made to the complainant, a substantiation of a continued recognised legal interest is lacking. Despite changes to the factual and legal situation in ways which are relevant to the decision due to the entry into force of the Termination Agreement, the complainant has not sufficiently fulfilled their obligation under § 23(1) second sentence, § 92 of the Federal Constitutional Court Act to substantiate that the prerequisites for admission for decision and admissibility of the constitutional complaint (cf. BVerfGE 106, 210 <214 f.>) remain fulfilled. The complainant fails to address the question whether they are still able to achieve the legal protection sought by means of their constitutional complaint (cf. BVerfGE 90, 22 <26 f.>; 119, 292 <301 f.>). If the constitutional complaint were to be granted, the order of the Federal Court of Justice of 31 October 2018 were set aside and the case were remanded to the Federal Court of Justice for a new decision (§ 95(2) Federal Constitutional Court Act), the Federal Court of Justice would be obligated to examine how the provisions of the Termination Agreement, which have come into force in the meantime, would impact the fate of the arbitral award. The Federal Court of Justice would be required, irrespective of the exceptions to the precedence of application of EU law (in form of the Achmea Judgment, cf. on this para 66 ff.) asserted by the complainant, to consider the possibility that the arbitral award at issue between the complainant and the Slovak Republic is void in accordance with § 1059(2) no. 1 of the Code of Civil Procedure due to the retroactive repeal of the Treaty through the Termination Agreement (see a) below). Most likely irrelevant in this regard is the question whether the arbitration proceedings between the complainant and the Slovak Republic at issue here would be considered to be ’pending’ or ’concluded’ within the meaning of the Termination Agreement. The provisions of the Termination Agreement suggest that an arbitral award ultimately cannot be upheld, irrespective of this distinction (see b) below). The separate constitutional complaint lodged by the complainant challenging the German act of approval to the Termination Agreement in parallel proceedings (file reference: 2 BvR 141/22) is of no significance in this regard (see c) below).

42

a) From the outset, several factors argue in favour of the invalidity of the arbitration agreement between the complainant and the Slovak Republic, given that the Termination Agreement provides that the Treaty is retroactively terminated. If the case were remanded to the Federal Court of Justice in accordance with § 95(2) of the Federal Constitutional Court Act, it would have to engage with this pertinent question. If the Federal Court of Justice concluded that the Treaty was retroactively terminated and the arbitration agreement retroactively invalid, the Federal Court of Justice would in all likelihood have to set aside the arbitral award once again (§ 1059(2) no. 1 Code of Civil Procedure). The complainant does not address this in a substantiated manner.

43-45

[…]

46

b) Section 3 of the Termination Agreement contains ‘provisions regarding claims made under bilateral investment treaties’. These provisions suggest that arbitral awards are to be set aside regardless of whether the arbitration proceedings are ‘concluded’ or ‘pending’. The complainant also does not engage with this in their submissions.

47-49

[…]

50

c) The constitutional complaint in parallel proceedings (file reference: 2 BvR 141/22), which challenged the German act of approval to the Termination Agreement, is inadmissible because the complainant did not sufficiently substantiate their claim of individual adverse effects. For this reason alone, it is of no relevance to the constitutional complaint at issue here (cf. Federal Constitutional Court, Order of the Third Chamber of the Second Senate of 23 July 2024 - 2 BvR 141/22 - para 25 ff.). The repeal of the Treaty at issue here between the Kingdom of the Netherlands and the Slovak Republic occurred independently of the German approval to the Termination Agreement. Art. 4(2) of the Termination Agreement explicitly provides that the termination of bilateral agreements on investment protection comes into effect as soon as the Termination Agreement enters into force ’for the relevant Contracting Parties’. The repeal of the bilateral agreement on investment protection at issue here came into force solely due to the ratification of the Termination Agreement by the Slovak Republic and the Kingdom of the Netherlands. The ratification of the Termination Agreement by the Federal Republic of Germany, with the effect that arbitration agreements the Federal Republic had entered into with other contracting parties were terminated, is irrelevant in this regard. Even if the Federal Republic of Germany had not ratified the Termination Agreement, the bilateral agreement on investment protection between the Kingdom of the Netherlands and the Slovak Republic would have been terminated ([…]).

51

This also means that the ratification of the Termination Agreement by the Federal Republic of Germany naturally did not have the effect that German courts were required to apply Art. 4(1) of the Termination Agreement in relation to bilateral agreements on investment protection between other contracting parties and set aside the arbitral award made to the benefit of the complainant for this reason alone. The complainant did not sufficiently demonstrate how the German act of approval to the Termination Agreement thus led to the devaluation of the arbitral award made to their benefit and how the complainant was therefore directly adversely affected by the act of approval.

52

3. Notwithstanding the aforesaid on how the Termination Agreement affects the recognised legal interest of the complainant, the constitutional complaint also fails to meet the requirements for substantiating a possible violation of rights in accordance with § 90(1) Federal Constitutional Court Act (§ 23(1) second sentence, § 92 Federal Constitutional Court Act). The complainant asserts that the challenged order of the Federal Court of Justice violates their substantive fundamental rights guaranteed by the Basic Law because the Federal Court of Justice should not have considered itself bound by the Achmea Judgment of the Court of Justice of the European Union and the interpretation of Arts. 267 and 344 TFEU resulting from this judgment. Generally, the binding interpretation of EU law, and thus the determination of whether the offer to submit disputes to an arbitral tribunal on the basis of Art. 8(2) of the Treaty is compatible with EU law, is the task of the Court of Justice of the European Union. Given the precedence of application of EU law, the Federal Court of Justice is bound by the interpretation of the Court of Justice of the European Union (see a) below). The precedence of application is only inapplicable under very limited and special circumstances, in which the strict requirements of the recognised instruments for constitutional review are met (see b) below). The complainant did not substantively show that the implementation of the Achmea Judgment of the Court of Justice of the European Union through the order of the Federal Court of Justice challenged here violates constitutional law due to the Achmea Judgment being an ultra vires act (see c) below) or because it encroaches upon the core of constitutional identity that is beyond the reach of European integration (see d) below). The complainant also fails to show that the order challenged here violates fundamental rights guarantees of the Basic Law in accordance with the standards of the Solange (or ‘as long as’) reservation (see e) aa) below) or that it is incompatible with the relevant fundamental rights or equivalent rights (see e) bb)-hh) below).

53

a) In accordance with Art. 23(1) first sentence of the Basic Law, the Federal Republic of Germany contributes to the establishment and development of the European Union. The uniform application of EU law is crucial for the European Union to be successful (cf. BVerfGE 123, 267 <368>; 126, 286 <301>). It could not exist as a legal community if there were no guarantee of the uniform application and effectiveness of its law (cf. the foundational explanations of the CJEU, Judgment of 15 July 1964, Costa/ENEL, 6/64, EU:C:1964:66). To this end, Art. 23(1) of the Basic Law lays down a commitment to ensure the effectiveness and enforcement of EU law (cf. BVerfGE 126, 286 <302>). Therefore, by empowering the Federation to transfer sovereign powers to the European Union (Art. 23(1) second sentence of the Basic Law), the Basic Law accepts the precedence of application accorded to EU law by the act of approval to the Treaties. In principle, this precedence of application of EU law over domestic law also applies with respect to conflicting provisions of constitutional law (cf. BVerfGE 129, 78 <100>), meaning that in the event of a conflict in a specific case, the relevant provision of domestic constitutional law is generally inapplicable (cf. BVerfGE, 126, 286 <301>).

54

b) aa) Unlike the supremacy of federal law, as provided for by Art. 31 of the Basic Law for the German legal order, the precedence of application of EU law cannot be comprehensive. It only applies insofar as the Basic Law and the act of approval permit or provide for a transfer of sovereign powers (cf. BVerfGE 73, 339 <375 f.>; 89, 155 <190>; 123, 267 <348 ff.>; 126, 286 <302>; 129, 78 <99>; 134, 366 <384 para. 26>). These constitutional standards correspond to the provisions set forth in the Treaty on European Union (TEU). The European Union is a community based on the rule of law (Art. 2 first sentence TEU; cf. CJEU, Judgment of 23 April 1986, Les Verts/Parliament, C-294/83, EU:C:1986:166, para. 23). Most notably, the European Union is bound by the principle of conferral (Art. 5(1) first sentence and Art. 5(2) first sentence TEU; cf. BVerfGE 75, 223 <242>; 89, 155 <187 f., 192, 199>; 123, 267 <349>; 126, 286 <302>; 134, 366 <384 para. 26>; 142, 123 <199 para. 144>) and by EU fundamental rights, and respects the constitutional identity of the Member States, on which it is founded (Art. 4(2) first sentence TEU, Art. 5(1) first sentence and Art. 5(2) first sentence TEU, Art. 6(1) first sentence and Art. 6(3) TEU; cf. BVerfGE 126, 286 <303>; 142, 123 <199 para. 144>). EU law therefore continues to require conferral in the Treaties. If institutions, bodies, offices and agencies of the European Union wish to extend their powers, such extension requires a corresponding treaty amendment, which the Member States must effectuate and take responsibility for in line with their respective constitutional rules (cf. in particular Art. 48(4) subpara. 2, Art. 48(6) subpara. 2 third sentence, Art. 48(7) subpara. 3 TEU; cf. BVerfGE 142, 123 <199 para. 144>). Similarly, the rule-of-law principle (Art. 2 TEU, Art. 20(3) of the Basic Law) requires that the exercise of public authority must have a valid legal basis. Thus, measures of institutions, bodies, offices and agencies of the European Union that result from an exceeding of competences are not based on a valid allocation of powers in the Treaties in conjunction with the corresponding act of approval and consequently cannot justify interferences with citizens’ rights and legal interests (cf. BVerfGE 134, 366 <388 para. 30>; 142, 123 <202 para. 152>; 164, 193 <283 para. 127> – Act Ratifying the EU Own Resources Decision – Next Generation EU).

55

On the basis of the ultra vires doctrine (ultra vires review), the Federal Constitutional Court is therefore entitled and required to review acts of institutions, bodies, offices and agencies of the European Union as to whether these acts evidently exceed the EU’s competences and, where necessary, to find that acts exceeding the EU’s competences are inapplicable for the German legal order (cf. BVerfGE 126, 286 <302>). This obligation of the Federal Constitutional Court to review substantiated ultra vires challenges regarding acts of EU bodies and other institutions must be coordinated with the mandate conferred upon the Court of Justice of the European Union through the Treaties to interpret and apply the Treaties and thereby ensure uniformity and coherence of EU law (cf. Art. 19(1) subpara. 1 second sentence TEU, Art. 267 TFEU). If any Member State could readily invoke the authority to decide, through its own courts, on the validity of EU acts, this could in practice undermine the precedence of application and jeopardise its uniform application of EU law (cf. BVerfGE 126, 286 <303>).

56

To find an ultra vires act, competences must have been exceeded in a sufficiently qualified manner. This standard of review ensures respect for the judicial mandate of the Court of Justice of the European Union enshrined in Art. 19 subpara. 1 second sentence TEU (cf. BVerfGE 126, 286 <307>; 142, 123 <200 f. para. 149>; 154, 17 <92 para. 112> – PSPP asset purchase programme of the ECB; 164, 193 <283 f. para. 129>). A qualified exceeding of competences must be manifestly evident and of structural significance for the division of competences between the European Union and the Member States (cf. BVerfGE 154, 17 <90 para. 110>; 164, 193 <283 f. para. 129>).

57

A measure of an EU institution, body, office or agency manifestly exceeds the competences conferred on it (cf. BVerfGE 123, 267 <353, 400>; 126, 286 <304>; 134, 366 <392 para. 37>; 142, 123 <200 para. 148>; 151, 202 <300 f. para. 151> – European Banking Union; 154, 17 <90 para. 110>) when, in applying common methodological standards, a competence cannot be established under any legal point of view (cf. BVerfGE 126, 286 <308>; 142, 123 <200 para. 149>; 151, 202 <300 f. para. 151>; 164, 193 <284 para. 130>). At the same time, establishing that a measure manifestly exceeds EU competences does not require that absolutely no dissenting legal views have been put forward on the issue. The fact that some voices in legal scholarship, politics or the media have argued for the permissibility of certain measures does not generally rule out that such measures can constitute a manifest exceeding of competences. An exceeding of competences can therefore be manifest even if it is the result of careful and meticulously reasoned interpretation of the law (cf. BVerfGE 142, 123 <201 para. 150>; 151, 202 <301 para. 152>; 154, 17 <92 f. para. 113>; 164, 193 <284 para. 131>).

58

The interpretation of EU law, including the determination of the applicable methodological standards, primarily falls to the Court of Justice of the European Union (Art. 19(1) subpara 1 second sentence TEU; cf. BVerfGE 142, 123 <205 para. 158>). The methodological standards developed by the Court of Justice of the European Union for the judicial interpretation and application of the law are based on the (constitutional) legal traditions common to the Member States, not least as they are reflected in the case-law of the Member States’ constitutional and supreme courts and of the European Court of Human Rights. In this regard, the wording of a legal provision (binding in several language versions), its regulatory purpose (effet utile) and the systematic context in which it exists, must be given particular weight. The particularities of EU law give rise to considerable differences with regard to the importance and weight accorded to the various means of interpretation. Yet the mandate conferred in Art. 19(1) subpara. 1 second sentence TEU is exceeded where the traditional European methods of interpretation or, more broadly, the general legal principles that are common to the laws of Member States are manifestly disregarded (cf. BVerfGE 142, 123 <206 f. para. 160>). Against this backdrop, it is not for the Federal Constitutional Court to substitute the Court of Justice of the European Union’s interpretation with its own when faced with questions of interpreting EU law, even if the application of accepted methodology, within the established bounds of legal debate, would allow for different outcomes (cf. BVerfGE 126, 286 <307>). On the contrary, as long as the Court of Justice applies recognised methodological principles and does not act in a way that is objectively arbitrary, the Federal Constitutional Court must respect judicial development of the law by the Court of Justice even when the Court of Justice adopts a view against which weighty arguments could be made (cf. BVerfGE 142, 123 <207 para. 161>).

59

A structurally significant shift of competences to the detriment of the Member States results where the exceeding of competences has a considerable impact on the principle of conferral and on the extent to which respect for the legal order, as part of the rule of law, is upheld. This is generally the case if the exercise of the competence invoked by the European Union is contingent upon a treaty amendment in accordance with Art. 48 TEU or the use of an evolutionary clause (cf. BVerfGE 126, 286 <309>; 151, 202 <301 para. 153>; 154, 17 <90 para. 110>), thus requiring action on the part of the German legislator pursuant to either Art. 23(1) second sentence of the Basic Law or the Act on the Bundestag’s and the Bundesrat’s Responsibility With Regard To European Integration (Integrationsverantwortungs-gesetz - IntVG) (cf. BVerfGE 89, 155 <210>; 142, 123 <201 f. para. 151>; 151, 202 <301 para. 153>; 154, 17 <90 para. 110>; 164, 193 <284 f. para. 132>).

60

Against this background, a constitutional complaint alleging an ultra vires violation can only be admissible if the complainants have shown that the special requirements for ultra vires challenges resulting from the Basic Law's principle of openness to European law have been met (cf. BVerfGE 142, 123 <174 f. para 83>).

61

bb) Insofar as measures by an institution or another body of the European Union have implications which encroach on the constitutional identity protected by Art. 79(3) in conjunction with Art. 1 and Art. 20 of the Basic Law, they exceed the limits of open statehood set by the Basic Law. They can have no application within the German legal order. In the context of a review on the basis of constitutional identity (identity review, Identitätskontrolle), it must be examined whether a measure by the European Union encroaches upon the principles that are declared inviolable by Art. 79(3) of the Basic Law (cf. BVerfGE 123, 267 <344, 353 f.>; 126, 286 <302>; 129, 78 <100>; 134, 366 <384 f. para. 27>; 140, 317 <336 f. para. 42 f.>). Those legal interests that are declared to be beyond the reach of European integration in accordance with Art. 23(1) third sentence in conjunction with Art. 79(3) of the Basic Law must not be relativised in individual cases (cf. BVerfGE 113, 273 <295 ff.>; 123, 267 <344>; 126, 286 <302 f.>; 129, 78 <100>; 129, 124 <177 ff.>; 132, 195 <239 ff. para. 106 ff.>; 134, 366 <384 ff. para. 27 ff.>).

62

The constitutional identity serves to protect the democratic self-determination of the German people. The manner and scope of the transfer of sovereign powers to the European Union must therefore satisfy democratic principles. If sovereign powers are transferred to the European Union in accordance with Art. 23(1) of the Basic Law, it must be ensured that the Bundestag retains for itself functions and powers of substantial political significance (cf. BVerfGE 123, 267 <344, 353 f.>; 126, 286 <302>; 129, 78 <100>; 134, 366 <384 f. para. 27>; 140, 317 <336 f. para. 42 f.>). This includes those matters that are of constitutive significance to the lives of citizens. It protects the fundamental, formative and identity-establishing essence of the state and society, which expresses its free and democratic character and the idiosyncrasies that results from this (cf. BVerfGE 123, 267 <357 f.>). If a violation of the protected constitutional identity that is beyond the reach of European integration is asserted, the preconditions of such a violation must be laid out and substantiated in detail (cf. BVerfGE 129, 124 <167 ff.>).

63

cc) The precedence of application of EU law generally also applies in relation to the fundamental rights contained within the Basic Law. This applies under the reservation that EU fundamental rights must guarantee effective protection of fundamental rights vis-à-vis the sovereign authority of the European Union, which must essentially be equivalent to the fundamental rights standards that are regarded as indispensable under the Basic Law and must especially guarantee the general essence of German fundamental rights (Solange reservation). This must be determined by a general assessment in relation to a specific fundamental right of the Basic Law (cf. BVerfGE 73, 339 <387>; 102, 147 <162 ff.>; 125, 260 <306>; 152, 216 <236 para. 47> – Right to be forgotten II; 155, 119 <163 para. 84> – Subscriber data II). As EU law currently stands, it must be assumed that these conditions are satisfied in principle (cf. BVerfGE 73, 339 <387>; 102, 147 <162 f.>; 118, 79 <95 f.>; 129, 186 <199>; 152, 216 <236 para. 48>). Constitutional complaints which are directed against binding ordinary EU law and assert a violation of the fundamental rights of the Basic Law are thus generally inadmissible (cf. BVerfGE 118, 79 <95>; 121, 1 <15>; 125, 260 <306>). The same applies in cases where a constitutional complaint is directed against the application of fully harmonised EU law in practice by national authorities (cf. BVerfGE 152, 216 <233 para. 43>; 155, 119 <163 para. 84>; by contrast, on the Federal Constitutional Court’s review of the application of binding EU legislation and the application of domestic provisions transposing binding EU legislation against the standard of EU fundamental rights, see BVerfGE 152, 216 <237, para. 52>). In this respect, the fundamental rights of the Basic Law only serve as a backup guarantee. If they are to be activated through a constitutional complaint, high requirements of substantiation must be met, which as a rule must present a comparison of fundamental rights protection on the national and European Union levels (cf. BVerfGE 102, 147 <164>; 152, 216 <236 para. 48>; 158, 1 <25 para. 40> – Ecotoxicity data).

64

dd) The possibilities of review reserved by the Federal Constitutional Court must be exercised in a manner that is restrained and reflects the openness to European law. In order to protect the proper functioning of the EU legal order and to prevent German authorities and courts from readily overriding the validity of EU law, the application of the instruments of review in a way that reflects the openness to European law requires adherence to the underlying legal precept of Art. 100(1) of the Basic Law, according to which it is for the Federal Constitutional Court alone to set aside the precedence of application of EU law with the consequence that EU law must be declared inapplicable in the Federal Republic of Germany in individual cases on the basis of constitutional law (cf. BVerfGE 123, 267 <354>; 140, 317 <337 para. 43>; 142, 123 <204 para. 155>). An application of the instruments of review which reflects the openness to European law additionally requires that, insofar as necessary, the matter is referred to the Court of Justice of the European Union for a preliminary ruling pursuant to Art. 267(3) TFEU, and the Federal Constitutional Court bases its review of the measure on the interpretation given by the Court of Justice of the European Union in its preliminary ruling (cf. BVerfGE 126, 286 <304>; 134, 366 <382 ff. para. 22 ff.>; 140, 317 <339 para. 46>; 142, 123 <204 para. 156>; 152, 216 <243 f. para. 68, 70>; 164, 193 <287 f. para. 139>).

65

c) Based on these standards, the strict requirements for the substantiation of the constitutional complaint are not met insofar as the complainant submits that the Federal Court of Justice should not have considered itself bound by the Achmea Judgment, on the grounds that it constituted an ultra vires The complaint fails to provide a substantive analysis showing that the way in which the Court of Justice of the European Union applied the law is manifestly unjustifiable (see aa) below) and leads to a structural reordering of competences away from the Member States and to the European Union (see bb) below).

66

aa) Insofar as the complainant argues that the Court of Justice of the European Union exceeded its judicial competences because its interpretation of Arts. 267, 344 TFEU is not covered by the wording, a systematic reading or the spirit and purpose of those provisions, there is insufficient discussion of previous case-law of the Court of Justice on this matter (cf. especially CJEU, Judgment of 30 May 2006, Commission/Ireland, C-459/03, EU:C:2006:345, para. 123 ff., 146 ff.; Advisory Opinion of 8 March 2011, European Patent Court, 1/09, EU:C:2011:123, para. 63; Advisory Opinion of 18 December 2014, ECHR, 2/13, EU:C:2014:2454, para. 201 f.) and the case-law following the Achmea Judgment (cf. CJEU, Judgment of 2 September 2021, Komstroy, C-741/19, EU:C:2021:655, para. 42 ff.; Judgement of 26 October 2021, PL Holdings, C-109/20, EU:C:2021:875, para. 44 ff.; Judgment of 25 January 2022, Commission/European Food et al., C-638/19 P, EU:C:2022:50, para. 124 f.; 137 ff.; Judgment of 14 March 2024, Commission/United Kingdom, C-516/22, EU:C:2024:231, para. 80). At the same time, the complainant does not discuss the reception of the Achmea Judgment in legal scholarship, according to which the judgment aligns with previous case-law on the autonomy of EU law and is therefore comprehensible ([...]). Even the majority of voices critical of the Court of Justice of the European Union’s interpretation of Arts. 267, 344 TFEU do not consider the Achmea Judgment to be an ultra vires act ([…]). The complainant’s submissions are limited to general assertions and solely substitute the legal opinions of the complainant for the assessment of the Court of Justice. Ultimately, the same applies to the complainant’s submissions on the claim that the Achmea Judgment results in a structural shift in the order of competences. Here, the presentation only refers to the abstract guidelines of the Lisbon Judgment of the Federal Constitutional Court (BVerfGE 123, 267), without applying these to the case at hand. All in all, the complainant fails to demonstrate that the Federal Court of Justice was not permitted to find itself bound by the Achmea Judgment.

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Throughout the discussion of the arguments of the Court of Justice of the European Union in the Achmea Judgment, the complainant also does not succeed in convincingly establishing that the Court evidently exceeded the judicial competences conferred upon it by Art. 19(1) TEU. In essence, the Achmea Judgment is carried by the view that disputes between investors and the state occurring within the European Union will typically concern matters which will also fall within the scope of application of the fundamental freedoms under the Treaty on the Functioning of the European Union and the fundamental rights under the Charter of Fundamental Rights of the European Union. If the Member States left it to the investment arbitral tribunals, which do not take part in the judicial dialogue with the Court of Justice of the European Union, to answer these questions, the Court of Justice sees a risk for the uniform application and autonomy of EU law, the preservation of which the Court of Justice of the European Union is tasked with. The submissions of the complainant do not indicate that this legal view based on Arts. 267, 344 TFEU is methodologically untenable under every conceivable aspect and therefore must be considered an ultra vires act. The wording of Art. 344 TFEU is open at least with regard to whether the dispute is ’concerning’ the interpretation and application of the Treaties and whether a method of settlement between investors and states is ’provided for’ in the Treaties. If a bilateral agreement on investment protection, as is the case in Art. 8(6) of the Treaty at issue here, contains a choice of law to the benefit of the national law of the host country and the general principles of international law, EU law can, as it falls under both categories, be decisive in arbitration proceedings between an investor and a Member State. ([...] contra Advocate General Wathelet, Opinion of 19 September 2017, Achmea, C-284/16, EU:C:2017:699, para. 175 ff.: The jurisdiction of the arbitral tribunal is confined to the application of the provisions in the bilateral agreement on investment protection). This applies in the same way if EU law is indirectly considered as a fact, for example in relation to the question whether a Member State is justified in taking a measure that inhibits investment, because it was complying with obligations of EU law ([...]). The Treaties provide for a way to solve such disputes between investors and Member States through legal recourse to the state courts, with the Court of Justice of the European Union watching over the uniform application and interpretation of the EU law in question by way of the preliminary ruling proceedings pursuant to Art. 267 TFEU. The wording of Art. 344 TFEU, especially when compared to the more precise wording of Art. 273 TFEU in this regard, does not contain a limitation to the effect that these provisions only apply to disputes between Member States ([...]). The Court of Justice takes the view that the uniform application of EU law in investment arbitration proceedings cannot be ensured through preliminary ruling proceedings, given that, according to the well-established case-law of the Court of Justice of the European Union, arbitral tribunals do not fall under the responsibility of the states and therefore cannot make a referral to the Court of Justice by way of preliminary ruling proceedings (cf. CJEU, Judgment of 23 March 1982, North Sea, 102/81, EU:C:1982:107, para. 11 f.; Judgment of 1 June 1999, Eco Swiss, C-126/97, EU:C:1999:269, para. 34; Judgment of 27 January 2005, Denuit et al., C-125/04, EU:C:2005:69, para. 13; Order of 13 February 2014, Merck Canada Inc., C-555/13, EU:C:2014:92, para. 17; contra Advocate General Wathelet, loc. cit., para. 84 ff.). Even a preliminary ruling procedure initiated by state courts conveyed through supporting competences (cf. § 1050 of the Code of Civil Procedure) would not necessarily ensure the uniform implementation of EU law, as it is disputed whether the provisions of arbitration law, insofar as they even exist in the respective jurisdictions, provide for such powers ([...]). Considering the heavily restricted scope of review in state annulment and enforcement proceedings, this would not ensure with certainty that all provisions of EU law would be given effect ([...] contra Advocate General Wathelet, loc. cit., para 239 ff.). There is nothing in the submissions of the complainant to indicate that these conclusions of the Court of Justice are methodologically untenable.

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bb) Furthermore, it has not been substantiated that the impact of the Achmea Judgment results in a structural reordering of competences away from the Member States and to the European Union. The effect of the Achmea Judgment is that Member States of the European Union can no longer make a valid offer to initiate arbitration proceedings on the basis of investment protection agreements within the European Union. In this way, the European Union does not seize competences from the Member States, but merely restricts the exercise of certain competences by the Member States.

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d) To the extent that the complainant also alleges a violation of constitutional identity, the only reasoning provided is the assertion that if the Federal Republic of Germany is unable to conclude bilateral investment treaties and arbitration agreements with other EU Member States, it will be permanently deprived of an essential enforcement mechanism in international law and thus lack key abilities to autonomously shape social and political life. However, the complainant does not address whether the competences of the Federal Republic of Germany are at all adversely affected in the case at hand. The challenged order of the Federal Court of Justice that implements the Achmea Judgment only has the effect of setting aside an arbitral award that benefitted the complainant based on the Treaty concluded by the Kingdom of the Netherlands and the Slovak Republic. The Federal Republic of Germany’s scope of action is thus not affected. This notwithstanding, the complainant fails to recognise that the Achmea Judgment actually involves the reverting of dispute resolution back to the state court system, the organisation of which is set out by the national legislator. In this respect, a substantiated reference to Art. 79(3) of the Basic Law and a discussion of the impact of bilateral investment treaties and arbitration agreements between EU Member States on the Federal Republic of Germany is missing. In this regard, it was necessary to establish to what extent bilateral investment treaties and arbitration agreements play a key role for the preservation of the inviolable essence of statehood as contrived by the Basic Law and as a result for the constitutional identity in accordance with Art. 79(3) of the Basic Law. A compelling argument for the fact that these circumstances are not decisive for the preservation of sovereign statehood is in particular that the Federal Republic of Germany has approved the Termination Agreement without reservations, which reproduces the consequences of the Achmea Judgment on the level of international law.

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e) Finally, the complainant also fails to substantiate that the implementation of fully harmonised EU law by the Federal Court of Justice in the case at hand would trigger the Solange reservation with respect to the fundamental rights of the Basic Law that the complainant asserts (see aa) below). Nor does the complainant substantiate that the Federal Court of Justice’s decision would be incompatible with the applicable fundamental right guarantees in any other way (see bb)-hh) below).

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aa) (1) The challenged order of the Federal Court of Justice of 31 October 2018 is based on the implementation of binding obligations under EU law. In such a case, there is generally no review of the decision’s compatibility with the fundamental rights of the Basic Law. The legal basis for the decision of the Federal Court of Justice is § 1059 of the Code of Civil Procedure, which concerns the annulment of domestic arbitral awards. Seen individually, this is a rule of German civil procedural law. The provision specifies the legal relationship existing between the parties of arbitration proceedings and makes a binding decision on the existence of an arbitral award issued regarding the parties. The connection to EU law is created through the requirements of § 1059(2) no. 1(a) and § 1059(2) no. 2(b) of the Code of Civil Procedure. In the case at hand, the Federal Court of Justice applied § 1059(2) no. 1(a) of the Code of Civil Procedure and, in examining whether the complainant and the Slovak Republic had concluded a valid arbitration agreement, took into account the primary law obligations under Arts. 267 and 344 TFEU as interpreted by the Court of Justice of the European Union in the Achmea The Achmea Judgment does not afford any discretion to the Member States. It unambiguously states that arbitration clauses in bilateral investment treaties between EU Member States are incompatible with Arts. 267 and 344 TFEU. Primary law provisions thus dictate the legal consequence that follows in this case, i.e. setting aside the arbitral award. The legal relations between the complainant and the Slovak Republic are thus determined by EU law in a manner that leaves no discretion to the Federal Court of Justice. The complainant does not sufficiently demonstrate (cf. para. 65 f.) that the binding effect of EU law ceases because the Achmea Judgment amounts to an ultra vires act and is therefore inapplicable in Germany.

72

(2) To the extent that the complainant asserts a violation of their fundamental rights under the Basic Law against this background, the complainant fails to engage, in a substantiated manner, with whether the challenged order of the Federal Court of Justice, which is based on the binding standards of Arts. 267, 344 TFEU as interpreted by the Court of Justice of the European Union, in fact does not meet the minimum standards of fundamental rights protection that is inalienable in accordance with Art. 23(1) first sentence of the Basic Law under the Solange reservation. The application of Arts. 267, 344 TFEU as interpreted in the Achmea Judgment affects the procedural rights of investors, since it removes their right to conduct investment disputes against Member States of the European Union before arbitral tribunals. The application of these provisions therefore does impact the legal position of those affected, as obtained arbitral awards can amount to recognised and established legal positions, but they have become practically worthless and unenforceable due to the threat of annulment in state review proceedings. However, the complainant does not sufficiently establish that this amounts to a violation of the inalienable minimum standards of fundamental rights protection within the meaning of Art. 23(1) first sentence of the Basic Law. The affected investors continue to retain sufficient protection of their fundamental rights. Damages enforced through arbitral awards are intended to provide compensation to investors for their futile investments and therefore solely serve economic interests. Their significance is not comparable to legal positions such as ownership of real estate of private individuals, for example, which for them is oftentimes the only and most valuable asset and therefore of decisive importance for their livelihood (cf. BVerfGE 134, 242 <291 f. para. 168> […]). At the same time, the affected investors retain the material legal positions that form the basis of the arbitral award. This means that they can still enforce the compensation or state liability claims they have in accordance with the relevant law before the competent state courts (cf. CJEU, Judgment of 26 October 2021, PL Holdings, C-109/20, EU:C:2021:875, para. 68; Federal Court of Justice, Order of 31 October 2018 - I ZB 2/15, juris, para. 72). In this regard, they can rely on the material investment protection in the European multi-level system, especially the fundamental freedoms of the Treaty on the Functioning of the European Union as well as the fundamental rights of the Charter of Fundamental Freedoms in accordance with Art. 51(1) of the Charter ([...]). After the unsuccessful exhaustion of domestic remedies, an individual application to the European Court of Human Rights is possible, where a violation of property rights in accordance with Art. 1 of the Protocol No. 1 to the European Convention of Human Rights can be claimed ([…]). In light of this, investors are referred to a protection regime that, despite not being specifically tailored to the protection of investors, generally offers sufficient legal protection and is suitable to give due effect to the rights in question.

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The complainant did not demonstrate that these standards would not also apply in the case at hand. In this respect, it must be taken into account that the Slovak Constitutional Court, in its Judgment of 26 January 2011, repealed the measures of law that led to the asserted losses incurred by the complainant (cf. para. 4). The complainant therefore does not have to first seek prior legal protection against state measures that inhibit investment, but can directly make compensatory or state liability claims against the Slovak Republic, which is also what the complainant is currently pursuing. Potential gaps in the protection of these rights do not justify making use of a form of dispute resolution that is decoupled from the EU legal order. Should such gaps in fact exist, they must be closed within the court system of the Member State, namely through infringement proceedings before the Court of Justice of the European Union or an individual application to the European Court of Human Rights (cf. CJEU, Judgment of 26 October 2021, PL Holdings, C-109/20, EU:C:2021:875, para. 68).

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bb) The complainant did not substantiate their claim that the Achmea Judgment violates the guarantee of private property, which due to the full determination by EU law must be measured primarily against the standard of Art. 17 of the Charter of Fundamental Rights (cf. BVerfGE 152, 216 <237 para. 52>).

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(1) Under Art. 17(1) first sentence of the Charter, every person has the right to own, use, dispose of and bequeath their lawfully acquired possessions. The right to property under EU law does not protect mere commercial interests or opportunities, the uncertainties of which are part of the very essence of economic activity, but applies to rights with an asset value creating an established legal position under the legal system, enabling the holder to exercise those rights autonomously and for his benefit (cf. CJEU, Judgment of 22 January 2013, Sky Österreich, C-283/11, EU:C:2013:28, para. 34; Judgment of 3 September 2015, Inuit Tapiriit Kanatami, C-398/13, EU:C:2015:535, para. 60; Judgment of 21 May 2019, Commission/Hungary, C-235/17, EU:C:2019:432, para. 69; Judgment of 24 September 2020, YS, C-223/19, EU:C:2020:753, para. 90; Judgment of 15 April 2021, Anie et al., C-798/18, EU:C:2021:280, para. 33; Judgment of 5 May 2022, BPC Lux 2, C-83/20, EU:C:2022:346, para. 39). The protection of the right to property under Art. 17(1) first sentence of the Charter is only afforded to those legal positions that were lawfully acquired. Legal positions for which this is not the case do not fall under the protection of the right to property in Art. 17(1) of the Charter (cf. CJEU, Judgment of 22 January 2013 Sky Österreich, C-283/11, EU:C:2013:28, para. 38 f.; Judgment of 8 March 2017, ArcelorMittal, C-321/15, EU:C:2017:179, para. 37 [...]). According to its wording, the right to property in Art. 17(1) first sentence of the Charter protects the possession and use of protected legal positions as well as their (testamentary) disposal, but not its acquisition ([...]).

76

In the determination of the significance and scope of the guarantees of Art. 17 of the Charter, the corresponding rights in the European Convention on Human Rights (Art. 1 of Protocol No. 1 to the Convention) and the relevant case-law of the European Court of Human Rights must also be consulted (Art. 52(3) of the Charter; cf. CJEU, Judgment of 3 September 2008, Kadi and Al Barakaat, C-402/05 P, EU:C:2008:461, para. 356; Judgment of 13 June 2017, Florescu et al., C-258/14, EU:C:2017:448, para. 49; Judgment of 21 May 2019, Commission/Hungary, C-235/17, EU:C:2019:432, para. 72; Judgment of 5 May 2022, BPC Lux 2, C-83/20, EU:C:2022:346, para. 37). Art. 1(1) first sentence of Protocol No. 1 to the Convention provides that every natural or legal person is entitled to the peaceful enjoyment of their possessions. The recognition of a legal position as protected property occurs on the basis of the autonomous interpretation of the Convention, regardless of whether the domestic legal order recognises the legal position in question as such. As a result, the guarantee of property not only protects physical goods but also other rights and interests constituting assets (cf. ECtHR <GC>, Beyeler v. Italy, Judgment of 5 January 2000, no. 33202/96, § 100; Former King of Greece and others v. Greece, Judgment of 23 November 2000, no. 25701/94, § 60; Anheuser-Busch Inc. v. Portugal, Judgment of 11 January 2007, no. 73049/01, § 63; Depalle v. France, Judgment of 29 March 2010, no. 34044/02, § 62). ’Property’ within the meaning of the Convention includes existing legal positions or assets including claims in respect of which the individual affected can argue that they have at least a legitimate expectation of obtaining effective enjoyment of a property right (cf. ECtHR, Pressos Compania Naviera S.A. and others v. Belgium, Judgment of 20 November 1995, no. 17849/91, § 31; ECtHR <GC>, J. A. Pye <Oxford> Ltd. and others v. the United Kingdom, Judgment of 30 August 2007, no. 44302/02, § 61). This applies to arbitral awards if the arbitral award determines a certain claim, is final and binding on the parties, has the same authority within the domestic legal order as a decision of the highest courts and can be readily enforced, is only subject to a limited review by the state courts and cannot be reviewed as to its substantive correctness (cf. ECtHR, Stran Greek Refineries and Stratis Andreadis v. Greece, Judgment of 9 December 1994, no. 13427/87, § 61; BTS Holdings AS v. Slovakia, Judgment of 30 June 2022, no. 55617/17, §§ 47 ff.).

77

(2) On the point of the guarantee of property, the constitutional complaint makes reference only to the national fundamental right in Art. 14 of the Basic Law – which is inapplicable as set out above. It does not demonstrate to what extent, based on these standards, the complainant can rely on Art. 17(1) of the Charter to oblige the Federal Republic of Germany to recognise and uphold the arbitral award. It fails to show whether the matter even falls within the provision’s scope of protection. The recognition of arbitral awards can be made subject to statutory provisions and limitations. The provisions of the Code of Civil Procedure to review domestic arbitration agreements (cf. §§ 1059 ff. of the Code of Civil Procedure) include procedural measures to determine and enforce the applicable limitations on the recognition of arbitral awards in individual cases. The Slovak Republic duly initiated such review proceedings. In this context, the Federal Court of Justice applied § 1059(2) no. 1(a) of the Code of Civil Procedure and was bound to enforce unambiguous requirements of EU law in its decision (cf. para 71). It was not entitled to reach a deviating decision, for example by balancing the annulment against the fundamental rights positions of the complainant. From the perspective of the Federal Court of Justice, the annulment of the arbitral award was the necessary consequence of an unambiguous legal situation. As has been shown, the complainant did not present compelling reasons for the assumption that the Federal Court of Justice was not permitted to find itself bound by this case-law (cf. para. 65-69).

78

(3) Based on the complainant’s submissions, the protection of legitimate expectations does not give rise to any factors that must be taken into account here. The Federal Court of Justice was bound by the retroactive determination of EU law by the Court of Justice of the European Union in the Achmea Judgment and was therefore entitled to find itself unable to protect legitimate expectations by upholding the arbitral award rendered on behalf of the complainant (cf. BVerfGE 126, 286 <314 f.>). As the Court of Justice of the European Union made no explicit determination to this effect in the Achmea Judgment, the preconditions for a limitation of the effects of the judgment in the preliminary ruling proceedings were not established (cf. CJEU, Judgment of 26 October 2021, PL Holdings, C-109/20, EU:C:2021:875, para. 64). Insofar as the complainant argues on a general level that the Federal Court of Justice did not recognise the relevance of the protection of their legitimate expectations, they do not take sufficient account of the reasoning of the decision. The Federal Court of Justice did assess the protection of legitimate expectations in the context of whether the argument of the Slovak Republic that an arbitration agreement was inexistent violated the principles of good faith and was therefore irrelevant as an impermissible exercise of law (cf. Federal Court of Justice, Order of 31 October 2018 - I ZB 2/15, juris, paras. 43-58). In this regard, the complainant did not show that the Federal Court of Justice did not recognise potential positions of legitimate expectations in this assessment or rejected these as a result of gross disregard for guarantees of fundamental rights. This application of the law instead complies with the established case-law and the views held in legal scholarship. In their grounds for appeal, the complainant ultimately substitutes their own legal assessment for the legal view of the Federal Court of Justice, without pointing out a failure to recognise their own fundamental rights positions in this regard.

79

Furthermore, the complainant does not demonstrate that they can claim a legitimate expectation which outweighs the annulment of the arbitral award (on the EU law standards cf. CJEU, Judgment of 10 January 1992, Kühn, C-177/90, EU:C:1992:2, para. 13 f.; Judgment of 15 April 2021, Anie et al., C-798/18, EU:C:2021:280, para. 42). Since the year 2006, the European Commission has repeatedly taken the view that bilateral investment treaties between EU Member States are incompatible with EU law. It was recommended to Member States to terminate any investment treaties in effect between them ([...]). The admissibility of arbitration agreements of this kind, and the arbitration proceedings conducted on their basis, have long been controversial, including in legal scholarship ([…]). For this reason alone, the investors could no longer have a legitimate and unreserved expectation of the compatibility of arbitration clauses in investment treaties with EU law. In the case of the complainant, there is the additional factor that from the beginning of the arbitration proceedings onwards, the Slovak Republic disputed the jurisdiction of the arbitral tribunal by invoking the incompatibility with EU law (cf. only the partial award of 26 October 2010 - PCA case-no. 2008-13 -, www.pca-cpa.org, paras. 8 f., 19, 23) and had also pointed out to the Commission those provisions of the investment treaty which they considered to be incompatible with EU law (cf. the partial award of 26 October 2010 - PCA case-no. 2008-13 -, www.pca-cpa.org, paras. 175-196). In light of these circumstances, there appeared to be a real possibility that the arbitral award obtained was, due to an incompatibility with EU law, based on an ultimately invalid arbitration agreement. This would result in a defect which would lead to its annulment in case of review by state courts ([...] similarly, see Federal Court of Justice, Order of 31 October 2018 - I ZB 2/15, juris, para. 45). The constitutional complaint does not counter these findings in a substantiated manner.

80

Insofar as the complainant claims that there was already an expectation at the time of the investment, thus from the year 2004, that arbitration clauses in international treaties, like Art. 8 of the Treaty, are compatible with EU law, this amounts to an expectation that the law will not change in the destination country of the investment. Due to the general changeability of the law and the voidability of international treaties alone there cannot be an unreserved protected expectation in the permanent existence of a specific legal framework. The complainant does not sufficiently demonstrate why this should be different in relation to arbitration clauses in bilateral investment treaties.

81

cc) To the extent that the complainant asserts a violation of their freedom to practice an occupation, the complainant fails to substantiate a violation of Art. 16 of the Charter, which is the only applicable guarantee in this respect. The protection of the freedom to conduct a business afforded by Art. 16 of the Charter protects the freedom to exercise an economic or commercial activity, the freedom of contract and free competition (cf. CJEU, Judgment of 22 January 2013, Sky Österreich, C-283/11, EU:C:2013:28, para. 42; Judgment of 17 October 2013, Schaible, C-101/12, EU:C:2013:661, para. 25; Judgment of 30 June 2016, Lidl, C-134/15, EU:C:2016:498, para. 28; Judgment of 26. October 2017, Finančné riaditeľstvo Slovenskej republiky, C-534/16, EU:C:2017:820, para. 35; Judgment of 12 July 2018, UAB Spika, C-540/16, EU:C:2018:565, para. 34). The freedom to conduct a business includes, in particular, the right for any business to be able to freely use, within the limits of its liability for its own acts, the economic, technical and financial resources available to it (cf. CJEU, Judgment of 27 March 2014, UPC Telekabel Wien, C-314/12, EU:C:2014:192, para. 49; Judgment of 30 June 2016, Lidl, C-134/15, EU:C:2016:498, para. 27). The European Convention on Human Rights does not explicitly recognise a guarantee of occupational freedom, but it does protect professional or business activities of natural or legal persons through the right to respect for private life in Art. 8(1) of the Convention (cf. ECtHR, Judgment of 16 December 1992, Niemietz v. Germany, no. 13710/88, § 29; Judgment of 16 April 2002, Société Colas Est and others v. France, no. 37971/97, § 41; Judgment of 28 January 2003, Peck v. the United Kingdom, no. 44647/98, § 57). Pursuant to § 1059 of the Code of Civil Procedure, the Federal Court of Justice had to examine whether an arbitral award settling a dispute between the complainant and the Slovak Republic could be considered valid under German law. Neither this statutory provision nor the proceedings are directly linked to the practice of an occupation. Rather, for both the statutory provision and the proceedings, the only decisive factor is whether the participants were parties to arbitration proceedings. It is unclear how the annulment of the arbitral award should compromise the present and future business opportunities of the company.

82

dd) The complainant also fails to substantiate a violation of the right to effective legal protection. The complainant fails to sufficiently discuss whether the scope of protection of this right is even affected. In the context of civil procedure, the right to effective legal protection is based on the general right of access to justice under 2(1) in conjunction with Art. 20(3) of the Basic Law (cf. BVerfGE 85, 337 <345>; 97, 169 <185>). The general right of access to justice encompasses the right to have recourse to state courts and a generally comprehensive review of the facts and law relating to the matter in dispute, as well as a binding decision by the judge (cf. BVerfGE 54, 277 <291>; 107, 395 <406 f.>; 141, 121 <134 para. 44>). Arbitral tribunals fall outside of this institutional framework. By agreeing on a dispute settlement mechanism outside of the state justice system, the parties waive their right of access to justice ([...]). Therefore, an agreement on dispute resolution through arbitration would at most be protected as an act of procedural private autonomy ([...]). This is not addressed by the complainant, much like the fact that they have the opportunity to claim their frustrated expenditures before the state courts in the Slovak Republic. The complainant cannot rely on the protection of a legitimate expectation that the option of dispute resolution before arbitral tribunals will persist (cf. para. 79 f.).

83

Applying the standard of the fundamental right to an effective legal remedy in accordance with Art. 47(1) of the Charter does not change this outcome. In order to provide an effective legal remedy through the court system, the authority that is called upon to preserve the rights bestowed by EU law must meet the requirements of a court as defined by EU law, especially in Art. 267 TFEU (cf. CJEU, Judgment of 19 September 2006, Wilson, C-506/04, EU:C:2006:587, para. 47 f.). Arbitral tribunals do not fall under this definition (cf. para 67).

84

Insofar as the proceedings before the state courts in Germany are at issue, a violation of the right to effective legal protection or the guarantee of an effective legal remedy can be ruled out. In the proceedings before the Frankfurt am Main Higher Regional Court and the Federal Court of Justice, the complainant was able to adequately present their views on the matter. The constitutional complaint does not give any concrete indications that the courts did not comply with their task to review the proceedings with due care.

85

ee) To the extent that the complainant asserts that the Federal Court of Justice violated the duty of referral under Art. 267(3) TFEU, the complainant fails to substantiate a violation of 101(1) second sentence of the Basic Law. There is no sufficiently clear analysis of the standards developed by the Federal Constitutional Court regarding the prerequisites for a violation of the duty of referral in accordance with Art. 267(3) TFEU that amounts to a violation of the right to one’s lawful judge, which is equivalent to a fundamental right (cf. on this, for example, Federal Constitutional Court, Order of the Second Chamber of the Second Senate of 8 November 2023 - 2 BvR 1079/20 –, para. 66 ff.). The complainant fails to sufficiently address the fact that according to the opinion of the Federal Court of Justice there were no questions of EU law relevant to the outcome of the proceedings that still needed to be clarified. Instead, the complainant merely states that in their view, a further referral should have been deemed to be necessary in light of the Achmea Judgment, which they consider to violate both the Basic Law and the European Convention on Human Rights. This however solely reflects the complainant’s own assessment of the legal situation and fails to show how the Federal Court of Justice deviated from existing case-law of the Court of Justice of the European Union in an untenable manner, or how that case-law still remains incomplete so that another referral would have been necessary (cf. on the applicable standard: BVerfGE 82, 159 <195 f.>; 126, 286 <316 f.>; 128, 157 <187 f.>; 129, 78 <106 f.>; 135, 155 <232 f. para. 181 ff.>). The Federal Court of Justice did recognise the relevant legal issues and concluded, in line with the case-law of the Court of Justice of the European Union, that the complainant had access to sufficient legal protection through the national court system (cf. Federal Court of Justice, Order of 31 October 2018 - I ZB 2/15 -, juris, para. 72).

86

To the extent that the complainant argues that another referral would have been necessary to clarify whether the temporal effect of the Achmea Judgment would have to be limited in accordance with the case law established by Defrenne (cf. CJEU, Judgment of 8 April 1976, Defrenne, 43/75, EU:C:1976:56, para. 69 f.; recently, for example, CJEU, Judgment of 17 March 2021, Academia de Studii Economice din Bucureşti, C-585/19, EU:C:2021:210, para. 79 f.; Judgment of 26 October 2021, PL Holdings, C-109/20, EU:C:2021:875, para. 59 f.), they do not show that the Federal Court of Justice disregarded their duty of referral in an untenable manner. The complainant does not even discuss whether the Court of Justice of the European Union can only impose a limitation of the temporal effect of an interpretation of a provision of EU law in the judgment itself, in which it decides on the desired interpretation (cf. CJEU, Judgment of 26 October 2021, PL Holdings, C-109/20, EU:C:2021:875, para. 61, with further references). As the Achmea Judgment does not in fact contain a limitation of the temporal effect of this kind, the Federal Court of Justice was justified in finding that the legal situation was clear in this regard. Furthermore, the subsequent case-law of the Court of Justice of the European Union confirms this assessment by the Federal Court of Justice (cf. CJEU, Judgment of 26 October 2021, PL Holdings, C-109/20, EU:C:2021:875, para. 57 ff.).

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ff) To the extent that the complainant asserts that the Federal Court of Justice violated Art. 101(1) second sentence of the Basic Law by not referring the case to the Federal Constitutional Court under Art. 100(2) of the Basic Law, the complainant fails to meet the applicable substantiation requirements. Proceedings under Art. 100(2) of the Basic Law are only interim proceedings to determine whether a general rule of international law is part of federal law (cf. BVerfGE 15, 25 <30>). They do not concern the application of such a rule to the facts of a specific case (cf. BVerfGK 13, 246 <251>; 14, 524 <533>). Essentially, the complainant criticises the Federal Court of Justice for failing to make a referral in accordance with Art. 100(2) of the Basic Law with regard to the question whether the possibility of an arbitrational dispute resolution in disputes between an investor and the state is guaranteed by customary international law, which, if this were the case, would form part of federal law, which would consequently oppose the Achmea It already appears questionable whether, in accordance with the standards set out above, a question phrased in this way could be the subject of referral proceedings in accordance with Art 100(2) of the Basic Law, as it is not limited to the question of whether a general rule of international law forms part of the federal law, but would ultimately lead to the inadmissible decision of whether the Achmea Judgment of the Court of Justice of the European Union was compatible with customary international law. In any case, the constitutional complaint is unable to give sufficient indication that the possibility to solve investment disputes using arbitral tribunals, which is explicitly provided for in most investment treaties and therefore appears to require regulation from the perspective of international law, also amounts to a rule of customary international law. Furthermore, the constitutional complaint does not indicate why such a rule of customary international law should prevent sovereign states from waiving this possibility as part of their accession to the European Union. Finally, the constitutional complaint does not indicate why it should matter in this particular case whether, as the complainant assumes, this rule of international law should form part of the federal law. This is the only question that could be answered in referral proceedings under Art. 100(2) of the Basic Law. However, for the case to be decided in this instance, the only relevant question is whether the Slovak Republic, under the law applicable to it, is able to provide for arbitration clauses of this kind in investment treaties.

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gg) A violation of Art. 103(1) of the Basic Law has also not been sufficiently substantiated.

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(1) Insofar as the complainant argues that the principles of the protection of legitimate expectations and legal certainty form part of EU law, that the Court of Justice of the European Union violated EU fundamental rights and the right of effective legal protection, and violated EU law by not providing for any transitional rules for arbitral awards granted in fully concluded arbitration proceedings despite the application of the complainant, they do not comprehensibly show a violation of the right to be heard. In this regard, it is insufficient to simply set out that the Federal Court of Justice disregarded their arguments. They already do not address the arguments presented in the challenged order, which indicate that the Federal Court of Justice did indeed both acknowledge and evaluate the arguments presented by the complainant (cf. Federal Court of Justice, Order of 31 October 2018 - I ZB 2/15 -, juris, paras. 65, 72). The fact that the Federal Court of Justice did not follow the legal view of the complainant does not amount to a violation of the right to be heard (cf. BVerfGE 64, 1 <12>; 87, 1 <33>).

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(2) This is no different insofar as the complainant claims that the Federal Court of Justice was required to address the principle of state immunity and the fact that the Federal Court of Justice was not permitted to declare certain provisions of the Treaty to be void, as the Kingdom of the Netherlands did not submit to the jurisdiction of the Federal Republic of Germany. In this regard, the complainant already fails to indicate how this argument would have been decisive in the present case (cf. BVerfGE 62, 392 <396>; 89, 381 <392 f.>). The Federal Court of Justice did not decide whether the Treaty is valid or not, but rather only whether an offer to reach an arbitration agreement based on Art. 8(2) of the Treaty on the part of the Slovak Republic is compatible with EU law (as expressly stated in Federal Court of Justice, Order of 31 October 2018 - I ZB 2/15 -, juris, para. 28). The reason why the Federal Court of Justice considers Art. 8(2) of the Treaty to be inapplicable in this instance is that the Court of Justice of the European Union prescribed a certain interpretation of the applicable provisions of EU law and the Federal Court of Justice applied the provisions in the prescribed way. That the Court of Justice of the European Union has the authority to decide on the compatibility of EU law with provisions of treaties of international law entered into by the Member States is, as the Federal Court of Justice explicitly points out in its order on the complaint seeking remedy for a violation of the right to be heard (cf. Federal Court of Justice, Order of 24 January 2019 - I ZB 2/15 -, juris, para. 3), beyond all serious question.

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(3) Furthermore, a violation of the right to be heard is not ascertainable insofar as the complainant argues that the Federal Court of Justice disregarded their argument that arbitration clauses in investment treaties are recognised in customary international law, so that the Achmea Judgment at best could only apply to future arbitration proceedings. The complainant’s submission is limited to the general assertion that the Federal Court of Justice would have decided differently if it had given proper regard to the complainant’s argument. There is, however, no discussion of the decision of the Federal Court of Justice challenged here, so that it remains unclear whether the complainant’s submission would have been decisive in the present case at all. Moreover, in its order on the complaint seeking remedy for a violation of the right to be heard, the Federal Court of Justice delineates in detail how it addressed the points raised by the complainant and why they were not relevant in this instance (cf. Federal Court of Justice, Order of 24 January 2019 - I ZB 2/15 -, juris, para. 4 f.).

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hh) Insofar as the complainant claims a violation of Art. 3(1) of the Basic Law, their submissions also remain insufficiently substantiated. Furthermore, a violation of the prohibition of arbitrariness, which requires that the challenged decision is not legally arguable under any aspect and it must therefore be concluded that it is based on irrelevant considerations (cf. BVerfGE 4, 1 <7>; 80, 48 <51>; 89, 1 <13>), can evidently be ruled out due to the careful reasoning contained in the order challenged here.

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This decision cannot be appealed.