Infrastructure Services Luxembourg S.À.R.L. (formerly Antin Infrastructure Services Luxembourg S.À.R.L.) v Kingdom of Spain
| Jurisdiction | England & Wales |
| Judge | Mr Justice Fraser |
| Judgment Date | 24 May 2023 |
| Neutral Citation | [2023] EWHC 1226 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: CL-2021-000362 |
[2023] EWHC 1226 (Comm)
THE HONOURABLE Mr Justice Fraser
Case No: CL-2021-000362
IN THE MATTER OF THE ARBITRATION (INTERNATIONAL INVESTMENT DISPUTES) ACT 1966
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS
COMMERCIAL COURT (KBD)
Rolls Building
Fetter Lane
London, EC4A 1NL
Patrick Green KC, Nicholas Cherryman and Richard Clarke (Instructed by Kobre & Kim (UK) LLP) for the Claimants
Tariq Baloch and Cameron Miles (Instructed by Simmons & Simmons LLP) for the Defendant
Hearing Dates: 29, 30, 31 March and 3 April 2023
Draft judgment distributed to parties on 17 May 2023
This judgment is in the following parts:
A. Introduction and Overview
B. Background to the Award and Order
C. The Issues on the Application
D. Issue 1: Jurisdiction
E. Discussion on Jurisdiction
F. Issue 2: Non-Disclosure
G. Discussion on Non-Disclosure H. Conclusions
A. Introduction and overview
This is a judgment upon an application by the defendant, the Kingdom of Spain (“Spain”), to set aside an Order of Cockerill J made on 29 June 2021 (“the Order”) which registered an arbitration award (“the Award”) which the two claimants had obtained following an arbitration against Spain. That arbitration was one conducted under the Convention which established the International Centre for Settlement of Investment Disputes (“the ICSID Convention”). This means, therefore, that the application to the Commercial Court by the claimants for registration, and the Order, were made under the Arbitration (International Investment Disputes) Act 1966 (“the 1966 Act”). Ordinarily, arbitration awards more routinely encountered are sought to be registered and enforced under the New York Convention, and therefore the Arbitration Act 1996 (“the 1996 Act”) would usually apply. That is not the case here, and this case is therefore somewhat different. The underlying dispute between the claimants and Spain which was referred to arbitration arose under the Energy Charter Treaty, and the Award is in the sum of approximately €120 million in the claimants' favour.
The application to Cockerill J to register the Award, which is what led to her making the Order, was made ex parte by the claimants under CPR Part 62.21(2)(b) and CPR 74.3(2)(b). The Order expressly granted Spain liberty to apply to have it set aside, which is the usual term included in any order that is made without notice to any party. Spain did so apply, seeking to have the Order set aside. Initially Spain sought to set aside the Order on the grounds of alleged defective service. That attempt to set aside the Order was dismissed in a consent order made by Moulder J on 7 March 2022, and in that order she extended time for Spain to seek to set aside the Order on the other grounds now advanced. That order by Moulder J also states in the recitals “upon the Parties having agreed that the date of service of the Order was 21 October 2021”. There is therefore no doubt as to the date of service as a result of this.
There are two grounds upon which Spain seeks to set aside the Order. In outline terms only, the first is sovereign immunity; the second is non-disclosure by the claimants in the application for registration that was made to the Commercial Court. The claim for sovereign immunity is broadly based upon lack of jurisdiction both on the part of the arbitral panel that made the Award, and also the court to register it. The foundations of these arguments are decisions of the Court of Justice of the European Union which are said by Spain to be authority, both in the law of the European Union (“the EU”) and international law, to found the absence of jurisdiction. This case therefore raises questions of sovereign immunity, recognition by the High Court of ICSID Convention awards, and the effect and operation of the 1966 Act, including potentially issues of international law. I shall explain the non-disclosure issues in Section F of this judgment below at [126.] and following.
That brief summary is sufficient to set the scene for the somewhat more complicated arguments advanced by the parties. The other point that requires some explanation is that the Order was made in the summer of 2021, and this application was heard by me in late March and early April 2023. That long duration was caused by a variety of different issues and steps. That period also included the European Commission applying to the court for permission to appear as an intervener. That application was refused, following a hearing, by Cockerill J and her judgment is at [2023] EWHC 234 (Comm). The application to intervene did not impact the period of the delay, which totals approximately 21 months, and is explained by other procedural steps that took months, rather than weeks, for a wide variety of reasons. Another factor was that the parties asked for a four-day hearing, and the dates when such hearings can be accommodated depend upon judicial availability. I refer to this overall period because those in charge of the component parts of the Business and Property Courts take pride in the efficient dispatch of disputes, including international disputes. The short point is that it is not because of the court that it has taken so long for this application to be heard.
The claimants were originally represented by Gibson, Dunn & Crutcher UK LLP, and the initial witness statement which supported the application to register the Award was made by a partner of that firm. The claimants are now represented by Kobre & Kim (UK) LLP, but nothing turns on that change, and I recite it for completeness. The evidence on the application was in the form of a number of different witness statements from Douglas Watson, Erika Saluzzo and Kunhee Cho for the claimants; and Stuart Dutson for Spain.
Finally by way of introduction, the parties between them cited in the hearing before me almost 200 different authorities, primary domestic legislation, international treaties and declarations, practitioner texts, law journals, extracts from Hansard, Law Reform Commission materials and also numerous press articles. Of the authorities, there were domestic cases including decisions of the Supreme Court, international ones from the International Court of Justice, international arbitral decisions, EU cases, and decisions of foreign courts including but not limited to those from the US, Australia, France, Luxembourg, British Virgin Islands, Lithuania, Netherlands, and Germany. There were also European Commission and Council Decisions on the Energy Charter Treaty itself. Extensive oral submissions were made on many of them.
Given that breadth of material, accommodating the hearing within only four days was a challenge, and all counsel are to be commended for the way that this was achieved. There were some very interesting issues of international law debated in the hearing, and the ultimate decision in this case may attract a degree of academic interest, if not interest also within other Member States of the EU who are also parties to the ICSID Convention. However, I will not be specifically addressing all of this extensive material in this judgment, although it has all been considered. This is for two reasons. Firstly, to do so would lead to this judgment evolving into something approaching a doctoral thesis, rather than a decision on registration of an arbitral award under the ICSID Convention and the 1966 Act. Secondly, preparing a comprehensive judgment of such length that deals with the entirety of the material cited to the court would take many months. The over-riding objective in CPR Part 1 means that the interests of other court users have to be taken into account, and to produce a judgment dealing with every single point raised would take so much time that this would be to the detriment of other users of the court. I will therefore only specifically refer to authorities or sources necessary to dispose of the issues.
There were also post-hearing submissions received by the court following judgment which was handed down by the Federal Court in Washington DC in the US on Friday 31 March 2023, the penultimate hearing day of the application. This had not come to the attention of either counsel before the hearing had finished on Monday 3 April, and so the claimants' counsel submitted a copy promptly afterwards and, at the request of the solicitors acting for Spain, I permitted further written submissions from both parties on both the cases that were provided, although I imposed a short page limit. This is because there was a risk that otherwise there would be endless further rounds of lengthy submissions, which after the full ventilation of matters during the hearing itself, would be counter-productive. The parties agreed between themselves that they would lodge these supplemental post-hearing submissions sequentially, and did so.
Also, Mr Baloch, who appeared as one of the two counsel instructed for Spain along with his junior Mr Miles, did not seek to make any oral submissions on the second of the two areas of challenge to the Order, namely non-disclosure by the claimants. This had been extensively addressed in the skeleton argument submitted by both him and Mr Miles. That second issue still remained a live issue and was not abandoned by Spain; rather Spain decided that Mr Baloch would use all of his time during the hearing for oral submissions to focus on the more complicated of the two grounds, namely jurisdiction.
B. Background to...
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