Operafund Eco-Invest Sicav Plc & Anor v The Kingdom Of Spain

Factual and Procedural Background

Investors incorporated in Malta and Switzerland commenced arbitration against Spain under the Energy Charter Treaty (“ECT”) on 31 July 2015. They selected ICSID arbitration and obtained an award for €29.3 million on 6 September 2019, later rectified on 28 October 2019. [1]

The Investors obtained an English registration order under section 2(1) of the Arbitration (International Investment Disputes) Act 1966 (“the 1966 Act”) on 14 September 2021. Spain subsequently challenged that order, including on state-immunity grounds. [2]

On 31 January 2024, the Investors purported to assign all rights, interests and benefits concerning the award to Company A. Company A applied to be substituted for the Investors in the ongoing proceedings. The trial judge dismissed that application, holding that the award was not assignable and that section 2 of the 1966 Act did not create assignable substantive rights. [3][4][5][6]

The Court of Appeal dismissed the appeal. [7][8]

Legal Issues Presented

1. Whether an original ICSID award creditor can assign the benefit of an award. [9]
2. Whether Article 15 of the ECT precludes assignment of an award concerning substantive ECT rights. [10]
3. Whether Article 54(2) of the ICSID Convention permits anyone other than the original award creditor to seek recognition or enforcement. [11]
4. Whether the original creditor’s initiation of recognition and enforcement proceedings is sufficient for Article 54(2). [12]
5. Whether the right to enforce an ICSID award can be assigned under section 2 of the 1966 Act. [13]

Arguments of the Parties

Company A’s Arguments

• Customary international law permits assignment of investor treaty rights, or at least does not prohibit assignment where the treaties are silent. [14][15]
• Article 15 of the ECT protects a specific subrogation mechanism and does not implicitly prohibit other assignments. [16][17]
• Article 54(2) uses “a party” broadly enough to include an assignee, and the ICSID Convention leaves enforcement-related matters to national law. [18][19][20]
• Registration under section 2 of the 1966 Act creates an English-law enforcement right capable of separate assignment. [21]

Spain’s Arguments

• International law does not recognise a general power to assign treaty rights without the consent of the state obligor. [14][22][23]
• Article 15’s express provision for state subrogation supports the conclusion that other assignments are excluded. [24][25]
• Article 54(2) permits recognition or enforcement applications only by a party to the ICSID arbitration. [26][27]
• Section 2 of the 1966 Act supplies enforcement machinery only and cannot create substantive rights inconsistent with the ICSID Convention. [28][29]

Table of Precedents Cited

Court's Reasoning and Analysis

The court treated assignability as an issue governed by international law because the ICSID award exists on the international-law plane. It rejected the proposition that domestic law could supply a general power to assign treaty rights. [83][84][85]

Applying the requirements for customary international law, the court held that the authorities and materials showed substantial disagreement rather than uniform state practice and opinio juris. The recent decisions relied upon by Company A were enforcement decisions from jurisdictions not shown to be specially affected by the issue. [86][46][87][88]

The court rejected the argument that treaty silence itself created an assignable right. The SS Lotus principle concerns whether conduct violates international law; it does not establish that states must recognise a transaction as altering their international obligations. [51][52][89][53]

The court held that enforcement of an ICSID award involves rights under Articles 53 and 54 of the ICSID Convention. Those rights are treaty rights, not merely domestic rights arising after registration. [90][91][92]

Article 15 of the ECT did not independently decide the appeal. Assuming a general power of assignment existed, the court would not have treated Article 15’s specific subrogation provisions as excluding all other assignments. [93][94][95][96]

Nevertheless, Article 54(2) was interpreted as allowing only a party to the ICSID award to seek recognition or enforcement. The wording was read with Article 53(1), under which the award is binding on the parties and those parties must comply with it. The court placed little weight on the certified-copy requirement, but considered the textual relationship between Articles 53 and 54 decisive. [97][98][99][100]

The argument that the Investors’ original application preserved Company A’s ability to enforce was rejected. A party continues to seek recognition and enforcement throughout the process, not merely when the application is issued. [101][102]

Finally, section 2 of the 1966 Act was held to provide procedural enforcement machinery, not a new substantive right capable of assignment independently of the award. Treating the right to enforce in one jurisdiction as separately assignable could produce inconsistent ownership of enforcement rights in different countries. [103][104][105][106][107]

Holding and Implications

APPEAL DISMISSED. The ICSID award was not assignable in the circumstances of the case, Article 54(2) did not permit Company A, as assignee, to seek recognition or enforcement, and section 2 of the 1966 Act did not create an independently assignable enforcement right. [8][108][109]

The decision directly prevents Company A’s substitution and independent enforcement of the award in these proceedings. The court expressly left open questions concerning involuntary transfers, corporate succession, and assignments consented to by the state. [110][111][112][113][114]

The judgment did not purport to establish a broader settled international consensus; it instead applied the court’s assessment of the current state of international law.