News / 24 oktober 2022

Termination of Energy Charter Treaty by the Netherlands helps global energy transition

The decision of Minister for Climate and Energy Rob Jetten to withdraw from the Energy Charter Treaty (ECT) is good news for the energy transition in the Netherlands and beyond. Governments of countries that are party to this treaty can therefore shape the transition to sustainable energy without having to fear claims by Dutch-based businesses.

The Energy Charter Treaty allows multinationals to file claims for millions of euros through a private arbitration tribunal if governments take climate measures that could harm their investments. This means that the treaty stands in the way of achieving the Paris climate goals.

Both ENDS has been working with partners for a number of years to raise awareness about the disadvantages of the ECT, especially in countries in the Global South that were considering joining the treaty, such as Uganda and Indonesia. In 2019, together with SEATINI from Uganda, we wrote a letter to all member states of the ECT, which was signed by more than 250 civil society organizations worldwide. Together we shared our concerns about the ECT and called to halt its expansion to new member states. In 2020, the ECT responded to this call.

Our joint efforts to stop the expansion of the ECT in Africa, Asia and Latin America go hand in hand with calls for European countries to leave the ECT. This is because many companies that submit claims to southern countries are located in European members states of the ECT. Because the Netherlands and a number of other countries (so far Italy, Poland, Spain and France) are now withdrawing from this treaty, the possibilities to submit claims are decreasing.

Both ENDS and partners are very content with Minister Jetten's decision. We see that our efforts with partners, together with the FGG alliance and Handel Anders, contributed to the decision. We will continue to raise awareness about the ECT, which primarily serves the fossil fuel industry, as well as to advocate for international trade and investment agreements that benefit sustainable and fair energy projects that ensure access to clean energy for all.

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