1994 Treaty
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The Energy Charter Treaty provides a multilateral framework for energy cooperation that is unique under international law. It is designed to promote energy security through the operation of more open and competitive energy markets, while respecting the principles of sustainable development and sovereignty over energy resources.
The Energy Charter Treaty was signed in December 1994 and entered into legal force in April 1998. To date the Treaty has been signed or acceded to by fifty-one states, the European Community and Euratom (the total number of its Signatories is therefore fifty-three).
The Treaty's provisions focus on four broad areas:
- the protection of foreign investments, based on the extension of national treatment, or most-favoured nation treatment (whichever is more favourable) and protection against key non-commercial risks;
- non-discriminatory conditions for trade in energy materials, products and energy-related equipment based on WTO rules, and provisions to ensure reliable cross-border energy transit flows through pipelines, grids and other means of transportation;
- the resolution of disputes between participating states, and - in the case of investments - between investors and host states;
- the promotion of energy efficiency, and attempts to minimise the environmental impact of energy production and use.
The Treaty was developed on the basis of the Energy Charter Declaration of 1991, but while this Declaration signalled the political intent to strengthen international energy ties, the 1994 Treaty is a legally binding multilateral agreement. It is the only agreement of its kind dealing with inter-governmental cooperation in the energy sector, covering the whole energy value chain (from exploration to end-use) and all energy products and energy-related equipment.
Status of Ratification of the Energy Charter Treaty
Details on the status of ratification of the Energy Charter Treaty, as of October 2009, are available here.