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Olik, Milos; Cap, Michal; Heyduk, Jaroslav --- "CZECH REPUBLIC" [2019] ELECD 2740; in Nagy, Csongor (ed), "Investment Arbitration in Central and Eastern Europe" (Edward Elgar Publishing, 2019) 95

Book Title: Investment Arbitration in Central and Eastern Europe

Editor(s): Nagy, Csongor

Publisher: Edward Elgar Publishing

Section: Chapter 4

Section Title: CZECH REPUBLIC

Author(s): Olík, Miloš; Čáp, Michal; Heyduk, Jaroslav

Number of pages: 42

Abstract/Description:

The era of investor-state arbitration in the Czech Republic could only begin after the so-called Velvet Revolution in 1989, when the communist regime was overthrown. Only two years later, the first bilateral investment treaty (BIT) came into force, between Czechoslovakia and France. Two years later, Czechoslovakia was divided into two independent and sovereign countries – the Czech Republic and Slovakia. Since then, the Czech Republic has come a very long way when it comes to foreign investment. In the early 1990s, investment arbitration was close to unknown to the general public, as this concept was new. In recent years, however, the main periodicals have often provided the public with information on yet another investment case where the Czech Republic was involved. Investment arbitration is seen in a more negative light, as in the past the public used to be constantly informed about how much money will have to be paid to a foreign investor from the state budget after an unsuccessful case, and how much money was spent on legal representation, even though media coverage is more balanced in these days. As of 2017, the Czech Republic is the third most sued country in the world when it comes to investor-state disputes. This is not just a current issue, as the Czech Republic has been among the five most sued countries in the world for more than 10 years now. There are many reasons behind these statistics, which the chapter explores in detail. Besides legislation, BITs and public perception, the chapter also delves into the in-depth body of case law that surrounds the country as a result of its high rate of investor-initiated litigation. Starting from the older cases, such as Ronald S. Lauder v. The Czech Republic, all the way to the newest ones like Pawlowski AG and Projekt Sever s.r.o. v. The Czech Republic. The analysis of the highly extensive case law thus serves as the crux of the chapter, with conclusions drawn from these experiences.