Operafund Eco-Invest SICAV Plc & Anor v Kingdom of Spain

An ICSID Convention award is not assignable merely because the Convention contains no express prohibition on assignment. Article 54(2), read in context and applying the Vienna Convention rules, permits recognition and enforcement only by a party to the arbitration. Awards concerning ECT claims are likewise non-assignable where the ECT contains no positive authority for assignment. No sufficiently widespread, representative and consistent state practice established a contrary rule of customary international law. Registration under the Arbitration (International Investment Disputes) Act 1966 provides a procedural means of enforcement and does not create new substantive rights or make an otherwise non-assignable award assignable.

The claimants obtained an ICSID Convention award against Spain arising from alleged breaches of the Energy Charter Treaty. The award was registered in England under section 1 of the Arbitration (International Investment Disputes) Act 1966. The claimants later purported to assign their rights under the award to Blasket Renewable Investments LLC and applied under CPR r.19.2(4)(a) for Blasket to be substituted as claimant.

Spain opposed substitution, arguing that the award was not assignable. Blasket also contended that Spain was issue-estopped by a judgment of the Federal Court of Australia concerning similar awards. The court considered the foreign judgment’s finality, enforceability and jurisdictional status, the availability of issue estoppel on a point of law, the construction of the ICSID Convention and ECT, customary international law, and the effect of registration under the 1966 Act.

The substitution application was refused. The claimants and Blasket failed to establish either an issue estoppel or a valid assignment engaging CPR r.19.2(4)(a).

1. A foreign judgment relied on for issue estoppel must be final and conclusive, concern the same parties and determine the same issue. The additional requirements in section 31 of the Civil Jurisdiction and Judgments Act 1982 also had to be satisfied. The Australian judgment was not yet final because no final order had been issued and sealed. More fundamentally, Spain had appeared solely to contest jurisdiction and immunity. Under section 33, that appearance did not amount to submission to the Australian court’s jurisdiction. The judgment therefore could not be recognised or enforced in England and Wales for issue-estoppel purposes.

2. Issue estoppel is capable of arising from a determination of law, including a pure point of law, provided that the point formed part of the ratio of and was fundamental to the foreign decision.

3. The Vienna Convention rules in Articles 31 and 32 governed interpretation. The phrase “a party” in Article 54(2) of the ICSID Convention referred, in context, to a party to the relevant arbitration. Articles 53 and 54 formed part of the Convention’s arbitration and enforcement scheme, and the Convention’s use of short and long forms of “party” did not establish a broader class of assignees.

4. The ECT’s express subrogation provision in Article 15 supported the conclusion that treaty claims and awards were not freely assignable. The material before the court did not establish a customary international-law rule either permitting or prohibiting assignment of ICSID awards.

5. Registration under section 2(1) of the Arbitration (International Investment Disputes) Act 1966 was procedural. It gave the award the force and effect of a High Court judgment for execution only. It did not create new substantive rights or alter the award’s assignability.

This was a first-instance decision. The judgment records related proceedings in the Federal Court of Australia and pending appellate proceedings concerning immunity, but no appeal from this judgment was determined.