Key Facts
- •Spain applied to set aside an order registering an ICSID arbitration award in favor of two claimants (Infrastructure Services Luxembourg S.À.R.L. and Energia Termosolar B.V.) for approximately €120 million.
- •The arbitration arose under the Energy Charter Treaty (ECT), which incorporates the ICSID Convention.
- •Spain challenged the order on grounds of sovereign immunity and non-disclosure by the claimants.
- •The claimants' investments concerned solar power installations in Spain, and the dispute stemmed from Spain's reduction and removal of tariff advantages.
- •Spain's sovereign immunity argument relied on CJEU decisions (Achmea and Komstroy) suggesting incompatibility between intra-EU investment arbitration and EU law.
- •The Order was made ex parte under CPR Part 62.21 and CPR 74.3(2)(b).
Legal Principles
State Immunity
State Immunity Act 1978, sections 1(1), 2(2), 9(1)
ICSID Convention
International Convention on the Settlement of Investment Disputes between States and Nationals of other States
Arbitration (International Investment Disputes) Act 1966
Arbitration (International Investment Disputes) Act 1966
Energy Charter Treaty
Energy Charter Treaty (ECT)
EU Law and Primacy
Treaty on the Functioning of the European Union (TFEU), Articles 267, 344, 351; CJEU case law (Achmea, Komstroy)
Vienna Convention on the Law of Treaties
Vienna Convention on the Law of Treaties (VCLT)
Full and Frank Disclosure
CPR Part 62.21; case law (Siporex, Commercial Bank of the Near East, Re OJSC Ank Yugraneft, Union Fenosa, Gold Reserve)
Outcomes
Spain's application to set aside the order was dismissed.
Spain failed to demonstrate grounds for setting aside the order. The court rejected Spain's arguments on jurisdiction and state immunity, finding that the ICSID award was valid and that Spain's treaty obligations under the ICSID Convention and ECT overrode the implications of EU law as interpreted by the CJEU. Furthermore, the court found that there was no material non-disclosure by the claimants.