What is the Energy Charter Treaty (ECT)?


11:48 AM

1 min read
What is the Energy Charter Treaty (ECT)? Blog Image


Denmark's energy ministry recently said that the country is working towards exiting the Energy Charter Treaty.

 About Energy Charter Treaty (ECT):

  • It 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.
  • It was signed in December 1994 and entered into legal force in April 1998.
  • It also established the Energy Charter Conference, an inter-governmental organisation which meets on a regular basis to discuss issues affecting energy cooperation.
  • There are currently 53 signatories and contracting parties to the ECT, including both the European Union and Euratom.
  • 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;


Q1) What is Euratom?

Euratom was created in 1957 to further European integration and tackle energy shortages through the peaceful use of nuclear power. It has the same members as the European Union and is governed by the Commission and Council, operating under the jurisdiction of the European Court of Justice. Euratom regulates the European civil nuclear industry, which produces almost 30 % of energy in the EU.

Source: Denmark latest EU country to plan Energy Charter Treaty exit