by Felix Grafinger
Ars Iuris recently hosted a keynote by Giulio Alvaro Cortesi, one of our postdoctoral Fellows, dedicated to his EU-funded research project RULIERD, “Investment and EU Law: Reconceptualizing Reverse Discrimination”. The keynote took place in the Hupka room and served both to present Cortesi’s doctoral research to a broader academic audience and to create an opportunity for exchange among doctoral and postdoctoral researchers. Beyond its substantive focus, the event also offered valuable insights into the practical possibilities of obtaining EU funding for similar projects.
Cortesi opened his presentation by situating the problem of reverse discrimination in a broader historical and theoretical context. How situations in which domestic economic actors are treated less favourably than foreign traders are not a novelty of modern EU law, as already in 1082, the Byzantine emperor Alexios I granted Venetian merchants fiscal exemptions and other trade advantages that were not extended to his own merchants, in order to secure a political alliance against the Normans. This historical example illustrated that preferential treatment of foreign actors has long raised questions of equality, economic advantage, and legal justification.
The theoretical point of departure was the idea that reverse discrimination within the European Union is often considered acceptable because it results from the coexistence of different legal orders. Where a domestic legal order applies one rule to an internal situation, while EU law applies a more favourable rule to a transnational situation, the resulting difference in treatment is usually justified on the basis that equality applies only within one legal order. Cortesi’s project challenges this assumption by asking whether this legal-theoretical explanation remains convincing where reverse discrimination affects the functioning of the internal market and the position of domestic and transnational investors.
At the centre of the keynote stood the relationship between EU law and international investment law. Intra-EU bilateral investment treaties have historically offered certain investors more generous substantive protections than EU law, including in relation to property, legitimate expectations, transfer rights, and state liability. Procedurally, they have also given cross-border investors access to arbitral tribunals, which are often perceived as more favourable to international investors. Cortesi referred in this regard to the experiences of Czechia, Italy, and Spain in the renewable energy saga, which illustrate how investment protection mechanisms can create significant tensions within the European legal order.
The problem, however, is not only constitutional but also economic. Cortesi explained that bilateral investment treaties may, under certain conditions, enable investors to capture the host government through the legal protections granted by the treaty. Drawing on the “two-tier bargaining model”, he showed how such structures can incentivise rent-seeking behaviour among international investors and, in some cases, risk replacing domestic monopolies with international ones. This economic perspective formed an important part of the project’s broader ambition: to assess whether reverse discrimination may endanger fair competition within the internal market.
A central part of the keynote concerned the gradual evolution of the Court of Justice of the European Union’s approach to international law. Cortesi traced a movement from early forms of monism, such as in Haegeman, through restrictions in GATT and WTO-related case law, towards an increasingly strong emphasis on the autonomy of EU law. This development culminated in cases such as Kadi, Opinion 2/13, and, in the investment law context, Achmea. In Achmea, the Court of Justice rejected the compatibility of intra-EU investor-state arbitration with EU law, thereby intensifying the conflict between the EU legal order and investment arbitration.
According to Cortesi, this development reveals a deeper tension. On the one hand, the Court of Justice seeks to protect the autonomy and unity of EU law. On the other hand, investment tribunals have often insisted on distinguishing between different normative spheres, therefore preserving the separate logic of international investment law. This creates what Cortesi described as a dualistic obstacle to equality and fair competition inside the European market. If legal orders are treated as sharply separate, inequalities between domestic and transnational economic operators may become harder to address within a coherent European constitutional framework.
A particularly important part of the keynote was Cortesi’s proposal of a new theoretical framework, which he calls “Mosaic Monism”. The theory takes its name from the image of a mosaic. Viewed horizontally, the European legal order appears as a composition of several tiles: different levels of delegation in the chain of validity and distinct articulations of competences assigned either to the European Union or to the Member States. Viewed from above, however, these tiles form a unitary legal experience, which reflects the central feature of a monistic understanding of law.
This idea also allowed Cortesi to draw an analogy to federal legal orders and to Hans Kelsen’s “three circles theory” (Drei-Kreise-Theorie). In Kelsen’s account, the overall constitution delegates both the law of the federation and that of the federated states. In a similar way, “mosaic monism” seeks to conceptualise the European legal order not as a fragmented interaction of isolated systems, but as a structured and coherent whole in which the distribution of competences can be understood within a broader constitutional frame.
The keynote concluded by connecting this theoretical proposal to institutional reform. Cortesi suggested that a coherent European approach to investment protection would require a unified framework capable of protecting both transnational and domestic investors within the EU market. One possible institutional consequence would be the creation of a Unified European Investment Court to implement such a framework. In this sense, the project does not merely diagnose a doctrinal tension but seeks to offer a constructive path towards a more equal and coherent legal architecture.
Following the presentation of the substantive research project, Cortesi also offered valuable insights into the practical realities of obtaining EU funding for an ambitious academic project. He spoke about the demanding application process, the competitive selection environment, and the essential aspects to advance through a wide array of candidates and institutional hurdles. For the doctoral and postdoctoral researchers present, this part of the keynote provided a particularly useful perspective on how EU funding opportunities can be used to support original legal scholarship at an early stage of an academic career.
The event concluded with an engaged discussion in which participants reflected on the theoretical, constitutional, and economic implications of the project, as well as on the broader future of EU law, investment law, and legal scholarship. Cortesi’s keynote offered not only a clear introduction to a complex and timely research topic, but also a compelling example of how ambitious legal theory can respond to concrete structural challenges in European law.
We sincerely thank Giulio Alvaro Cortesi and all those present for their participation and look forward to further academic exchanges within the Ars Iuris.
