Energy Charter Treaty

Energy Charter Conference

Formation	1991 (1991)
Type	Intergovernmental organization
Headquarters	Brussels, Belgium
Official language	English, Russian, Spanish, French, Italian, German
Secretary General	Urban Rusnák
Deputy Secretary General	Selim Kuneralp
Chairman	Fumio Kishida
Main organ	Energy Charter Conference
Staff	approx. 30
Website	http://www.energycharter.org/

The Energy Charter Treaty (ECT) is an international agreement which establishes a multilateral framework for cross-border cooperation in the energy industry. The treaty covers all aspects of commercial energy activities including trade, transit, investments and energy efficiency. The treaty is legally binding, including dispute resolution procedures.

Originally, the Energy Charter process was based on integrating the energy sectors of the Soviet Union and Eastern Europe at the end of the Cold War into the broader European and world markets. Its role however extends beyond East-West cooperation and through legally binding instruments strives to promote principles of openness of global energy markets and non-discrimination to stimulate foreign direct investments and global cross-border trade.

Awards and settlements of the international arbitrations put forward by breaking the law of the Energy Charter Treaty are sometimes in the hundreds of millions of dollars. In 2014, the nearly-10 year long Yukos case was decided in favor of the claimants on the basis of the Treaty, with a record-breaking $50 billion award.

Full versions of the treaty, both consolidated and official, can be found here.

The beginnings of the Energy Charter date back to a political initiative launched in Europe in the early 1990s. The time at end of the Cold War offered an unprecedented opportunity to overcome previous economic divisions between the nations on both sides of the Iron Curtain. The clearest prospect for mutually co-dependent beneficial cooperation was the energy sector, given Europe's growing energy demand and vast resource availability in post-Soviet nations. Additionally there was a recognised need to ensure that a commonly accepted foundation was established for developing energy cooperation among the states of Eurasia. On the basis of these considerations, the Energy Charter process was born.