Arbitration (Amendment) Bill 2025: Committee Stage (Resumed)
Seanad Éireann — 2026-05-28
============================================================

Alice-Mary Higgins (IND), National University of Ireland

What we are seeing in amendment No. 11 is an attempt to expand the very vague language there is in the Bill at the moment. Basically, it says it was never enforceable and we would not enforce it if enforcing it would compromise the constitutional order of the State or the autonomy of the legal order of the European Union. It is very unclear what is meant by the constitutional order of the State or what is meant by the autonomy of the legal order of the European Union.
Is that a bar that is very far back, where we are almost back to the right to regulate? If it compromises the existing Constitution and the fact that the European Union has its autonomy, are we going to get into the kind of granular examples, which are provided under amendment No. 11, that make it a little bit clearer when we talk about the idea and we make the choice – this is stepping into the noose analogy from Senator McDowell - to place ourselves at the mercy of a tribunal and then say that we will not enforce it if it conflicts with this very vague language about constitutional order and the European Union? What we have in amendment no. 11 from Senator Andrews and others is something that is actually more meaningful, whereby when we say that we will not conflict with the autonomy, does that mean that we will not conflict with the ability to deliver on the Charter of Fundamental Rights, not through a direct block but by compromising the ability and obligation of the State to give effect to European laws?
Are we talking about a situation whereby, in terms of the Constitution, if we have a referendum and that referendum of our Constitution gives rise to consequent measures and then we have a case taken seeking compensation in relation to measures which have arisen as a result of that referendum, will they be eligible or not if we have situations again? If we as a collective choose to give each other particular rights and those rights end up compromising in a way that is claimed to be unfair or inequitable to the interests of a particular industry or company, will that be featured? How will that factor into the enforcement piece? What if the compensatory award from the arbitration tribunal is based on a refusal by a relevant tribunal to follow a decision of the Court of Justice of the European Union, and if the measure the Government has taken, for which compensation has been sought, is one that if we did not take that measure, we would be in conflict with rulings Court of Justice of the European Union? Indeed, what if it is a situation whereby this compensatory measure for which enforcement is being sought would impose on the State liability or damages in relation to the enactment or maintenance of a legislative measure that the State enacted in good faith within its constitutional order - and some later ones are going to come in which set it out a little bit more?
Why this all matters is the arbitration bodies are not bound. The Minister quoted a lot about the European Court of Justice, and that was a consideration of whether it is directly in itself de facto a conflict to have these courts exist. That was that ruling but it was not a matter of endorsing the findings of it. There were a lot of conditionalities of hopes from the Court of Justice of the European Union as to how things might work out but let us be clear, in terms of the arbitration bodies themselves, they are not bound by the European Court of Justice. They are not bound by national law or constitutional referendums. If an arbitration body of any kind of these kinds of investor-State mechanisms is being asked whether a company is being treated fairly or inequitably, it considers the law solely in itself. It considers the law solely in relation to how that company has been affected in relation to its reasonable expectations of profit and whether its future profit has been taken from it in a way that is unfair or unreasonable. It is not considering in the round how that really relates to constitutional issues in Ireland or what were the obligations that the Irish Government had under the Court of Justice of the European Union. It may choose to consider that but it is not bound by it.
We are not talking about a new court that is somehow sitting inside the legal system we know; we are talking about new courts or tribunals that are sitting outside our legal systems. It simply goes to our legal systems to have them enforced and have the moneys taken. In terms of making the awards, however, it does not consider that. There are multiple examples here. In Huawei vs Sweden, it took a case - an ISDS claim - against Sweden over Sweden's decision to ban Huawei's involvement in 5G in line with an EU policy on the transposition of the EU toolbox on cybersecurity international law. A number of countries took measures in relation to that. In that tribunal, Sweden asked that the EU would be allowed to give evidence in the case. This is even to be allowed to give evidence in the case - and the tribunal limited input from the EU and dismissed any need for the EU to place Sweden's actions in the context of EU law. In the case of Klesch vs the EU, Germany and Denmark, this is a fossil fuel investor suing the EU, Germany and Denmark. It is suing everybody for compensation in relation to the 2022 windfall profits tax on the energy sector and is challenging the implementation of EU Council directives and again, in the case of Denmark, this is where the effects kick in. The German Government decided not to collect the tax on the investor and the tribunal ordered that the German Government should not collect the tax pending the outcome of the case.
There are multiple examples whereby the arbitration bodies are not asking how this fits in. They are not saying they understand Ireland made this decision because of a referendum of the people that mandated measures in relation to care or whatever else it might have been. They are not saying they understand that we did not opt into whatever decisions are made or that this is why it has to be done or that there are new EU rules which set the context and even though that affects a company that was encouraged to invest in Ireland, Ireland has to ensure it is abiding by the European Court of Justice and its rulings. That is not binding on an arbitration body when it is deciding how much compensation to award. It may be a factor that is considered or not but it is not binding in any way. Having agreed without an obligation to this, having chosen to say we want to move into this next phase where we have these tribunals which can make awards against us - again a step that solely the Government is choosing to push at this time rather than continue in a longer period of provisional application - by doing that and pressing that point and placing us in that situation, all that we can come back at according to the Government is that we will agree to bodies making these rulings against us voluntarily but we will not enforce them if they compromise the constitutional order or the autonomy of the European Union. What does that mean? Does that mean at the absolute minimum the constitutional order is when it would affect the fact we are a constitutional nation and that the European Union can make laws?
Regarding the points which Senator McDowell very ably made, if we agree voluntarily to make ourselves subject to these rulings, then the choice in terms of surrendering sovereignty has already been made. We have chosen to say we want to be subject to these arbitration rulings. That is then going to be stacked by a court. Leaving aside the fact that this supposed fix to the concerns the public had is very vague, and amendment No. 11 would clarify it, it would be great if the Minister went through and stated which of these aspects of amendment No. 11 are going to apply or not or if he accepts amendment No. 11 as an expansion of clarification. There is also the point concerning amendment No. 12. Is that amendment grouped with this? It is.
The actual thing the public cares about when they hear this and the fear that they have is in no way addressed by the language of the Bill. I have said that the arbitration bodies do not have to balance out EU law, constitutional law and everything else. It is almost a simple law of tort. They are literally in that one space and very often come from that frame in their adjudications. A High Court would normally be provide a balance that considers the public interest. It would be in the mix. The public interest is not in the mix for the arbitration bodies. It is not in the mix for the arbitration bodies that are making the decision. They are not bound by the public interest, the European Court of Justice or national laws at any level. The High Court, when it is deciding whether to enforce, according to the legislation, is only bound by very a narrow framework, which is whether it compromises the constitutional order, the fact that we are staying within the Constitution or the legal autonomy of the European Union. It is not being asked to do what it normally does, which is to consider the public interest. That is why amendment No. 12 is important. It would put the public interest among the factors the High Court should consider when deciding whether it should be enforcing a ruling from these courts, which operate in their separate space. It would have to weigh the public interest and all the facets that go with that alongside a consideration of the constitutional order and questions of EU law.
Amendments Nos. 11 and 12 are constructive. Amendment No. 11 tries to give meaning to these very loose phrases in the Bill, "constitutional order" and "legal autonomy", while amendment No. 12 tries to get to what the public care about and the kinds of concerns that led the Supreme Court to worry about the constitutionality in the first place and to find of favour of then Deputy Costello and the compromising of the public interest. I ask the Minister of State to be clear in supporting these two amendments.

---

Source: Houses of the Oireachtas. Licensed under CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/). The Official Report is revised after first publication; the fetch timestamp below identifies the version quoted.

Record URI: https://data.oireachtas.ie/akn/ie/debateRecord/seanad/2026-05-28/debate/main
Retrieved: 2026-08-14T04:55:01+00:00
Sitting date: 2026-05-28