UK Supreme Court confirms states can not depend on immunity to withstand recognition and enforcement of ICSID awards

The UK Supreme Court has unanimously held that Spain and Zimbabwe can not invoke state immunity to withstand the popularity and enforcement of ICSID arbitral awards, confirming that their accession to the ICSID Convention constitutes a submission to the jurisdiction of the English courts.

In linked appeals, the Court held that by agreeing to Article 54(1) of the ICSID Convention, contracting states agree that every one different contracting states are obliged to recognise and implement ICSID awards in opposition to them. The Supreme Court discovered that this quantities to submission to the jurisdiction of the English courts for the needs of part 2(2) of the State Immunity Act 1978, that means the states can not depend on adjudicative immunity to oppose the registration of ICSID awards in opposition to them.

The judgment is a major improvement in investor-state dispute settlement (ISDS) and varieties a part of a rising physique of choices worldwide addressing the connection between state immunity and the enforcement of ICSID awards, together with instances in Australia, New Zealand, Malaysia, the United States and the British Virgin Islands. The ICSID Convention at the moment has 158 contracting states, making the choice an essential clarification of its operation within the UK.

Border Timbers, the respondent within the enchantment in opposition to Zimbabwe, was represented by 3VB’s Dominic Kennelly and Catherine Drummond, led by Christopher Harris KC at Gibson Dunn, instructed by Baker McKenzie.

Spain was represented 3VB’s Cameron Miles, led by Lucas Bastin KC of Essex Court Chambers, instructed by Curtis, Mallet-Prevost, Colt & Mosle.

The Supreme Court’s choice confirms that states social gathering to the ICSID Convention can not depend on state immunity to withstand the registration of ICSID awards within the UK, reinforcing the Convention’s framework for the popularity and enforcement of investor-state arbitral awards.

Read the judgment in full here.