RUSSIA AND THE ENERGY CHARTER TREATY

That this House welcomes the recent ruling of the Arbitral Tribunal which sat at the Permanent Court of Arbitration in The Hague confirming that Russia was bound by the entire Energy Charter Treaty (ECT), having accepted full application (provisionally pending ratification), when it signed the Treaty; believes the ruling is a significant development in Russia's energy ties with the European Union that strengthens the case for the ECT to be the centrepiece of a rules-based relationship; notes that following Russia's withdrawal from provisional application of the ECT on 19 October 2009, investments existing on that date in the Russian energy sector will continue to be protected by the Treaty's investor protection rules for a further 20 years, but that new investments will no longer be protected; further notes that while Russian investors in the European energy market enjoy the full protection of European law, new European energy investors in Russia will have to rely on the goodwill of a Russian government that has shown a weak commitment to property rights; calls on EU leaders to make it clear to the Russian government that there must be a level playing field and that close and friendly energy ties depend on the acceptance of binding rules and reciprocal obligations that are fair and legally enforceable in an independent forum; and urges the Russian government to show foreign customers and investors alike that it understands the need to restore confidence in its behaviour as a producer and supplier of energy by re-engaging with the ECT.