The roots of the Energy Charter date back to a political initiative launched in Europe in the early 1990s, at a time when the end of the Cold War offered an unprecedented opportunity to overcome previous economic divisions. Nowhere were the prospects for mutually beneficial cooperation clearer than in the energy sector, and there was a recognised need to ensure that a commonly accepted foundation was established for developing energy cooperation among the states of Eurasia. On the basis of these considerations, the Energy Charter process was born.
In a world of increasing interdependence between net exporters of energy and net importers, it is widely recognised that multilateral rules can provide a more balanced and efficient framework for international cooperation than is offered by bilateral agreements alone or by non-legislative instruments. The Energy Charter Treaty therefore plays an important role as part of an international effort to build a legal foundation for energy security, based on the principles of open, competitive markets and sustainable development.
The Energy Charter Treaty and the Energy Charter Protocol on Energy Efficiency and Related Environmental Aspects were signed in December 1994 and entered into legal force in April 1998. To date, the Energy Charter Treaty has been signed or acceded to by fifty-two states, the European Community and Euratom (the total number of its members is therefore fifty-four).
The Treaty was developed on the basis of the 1991 Energy Charter. Whereas the latter document was drawn up as a declaration of political intent to promote energy cooperation, the Energy Charter Treaty is a legally-binding multilateral instrument.
The fundamental aim of the Energy Charter Treaty is to strengthen the rule of law on energy issues, by creating a level playing field of rules to be observed by all participating governments, thereby mitigating risks associated with energy-related investment and trade.
Fifty-two European and Asian countries have signed or acceded to the Energy Charter Treaty. All EU states are individual signatories, but the Treaty has also been signed collectively by the European Community and Euratom so the total number of parties to the Treaty is fifty-four.
Of these fifty-four, all have ratified the Treaty except for five. These countries are Australia, Belarus, Iceland, Norway, and the Russian Federation. Belarus and the Russian Federation have accepted provisional application of the Treaty, which meant that – pending ratification – they agreed to apply the Treaty to the extent that it was consistent with their own constitutions, laws and regulations. On 20 August 2009 the Russian Federation has officially informed the Depository that it did not intend to become a Contracting Party to the Energy Charter Treaty. In accordance with ECT Article 45(3(a)), such notification resulted in Russia's termination of its provisional application of the Treaty upon expiration of 60 calendar days from the date on which the notification was received by the Depository. Therefore, the last day of Russia's provisional application of the Energy Charter Treaty was 18 October 2009. Belarus still applies the Treaty provisionally.
With its current membership, the Energy Charter has a natural focus on the evolving Eurasian energy market, including the Mediterranean region, the Middle East and North Africa. Although the Treaty was conceived as a European initiative with a focus on 'East-West' cooperation, the scope of the Energy Charter is now considerably broader. Pakistan, China, Korea, Iran and Association of South-East Asian Nations have all have all taken on observer status in recent years.
Editor: Han Shuang