France becomes the latest country to leave the controversial energy charter France | Whuff News

France has become the latest country to issue a controversial energy charter agreement (ECT), which protects fossil investors from policy changes that could threaten their profits.

Speaking after the EU summit in Brussels on Friday, the French president, Emmanuel Macron, said: “France has decided to withdraw from the energy agreement.” Quitting the ECT was “in line” with the Paris climate agreement, he added.

Macron’s statement follows the recent vote by the Polish parliament to leave the 52-nation agreement and announcements by Spain and the Netherlands that they also want to leave the scheme.

Earlier on Friday, Macron’s ally in Brussels, French MEP Pascale Canfin, he said: “We need to get out of the energy charter because we end up being sued by international companies using private judgments that prevent us from implementing our climate policies.”

The European Commission has proposed an “improvement” to the agreement, which would end the registration of secret investor courts among EU members. That plan is expected to be discussed at a meeting in Mongolia next month.

A French government official said Paris would not try to block the EU transition plan or the Mongolian summit. “But whatever happens, France is going,” the official said.

While France “was ready to coordinate withdrawal with others, we do not see that there is a serious mass ready to join the EU bloc as a whole”, added the official.

The French withdrawal will take about a year to complete, and during that time, the debate in Paris will continue on ways to remain neutral or to shorten the period of the “sunset clause” in the ECT that allows retroactive judgments. Progress on the issue is thought to be possible by sources close to ongoing legislative negotiations on the matter.

The power charter was established in 1994 to protect western energy firms operating in former Soviet countries. It allows investors to sue governments that impose policies that may undermine their expected financial returns.

However, critics have estimated that the final cost of compensation for fossil fuel companies could rise to more than a trillion dollars.

In August, UK oil company Rockhopper was awarded £210m in compensation for an Italian offshore drilling ban. Italy has also withdrawn from the agreement.

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