Cuatrecasas advises on the annulment of an award against Spain for cuts in renewable energy.

Cuatrecasas has represented OperaFund Eco-Invest (Malta) and Schwab Holding (Switzerland) in the annulment proceedings brought by Spain against the award rendered in september 2019 in the case ‘OperaFund and Schwab v. Spain’.

The dismissal of the annulment action involves the confirmation of the award that condemned Spain to compensate OperaFund and Schwab with more than €29 million, plus interest and costs, for the cuts to the incentives for the renewable energy plants in which they invested.

The litigation and arbitration team involved in the transaction comprised Alberto Fortún, José Ángel Rueda, Miguel Gómez, Borja Álvarez, Gustavo Mata, José Ángel Sánchez, Lucía Pérez-Manglano, Ignacio Hernández and Elisa Salcedo.

Spain made numerous claims for annulment of the award grouped under three of the grounds provided for in Article 52 of the ICSID Convention: manifest excess of powers by the Arbitral Tribunal, failure to state reasons in the award, and serious violation of fundamental procedural rules. However, the ICSID ad hoc commission rejected them in their entirety.

In particular, it rejected Spain’s argument that the tribunal had exceeded its powers by declaring itself to have jurisdiction over a dispute between a company of a member state of the European Union and another state that is part of the EU. The ad hoc committee also found that the Court’s decision on jurisdiction was not only reasonable, but also fully reasoned in all respects. The ad hoc committee also concluded that no fundamental right of Spain had been violated by the Court.

In sum, the ad hoc Committee concluded that none of the grounds for annulment raised by Spain met the high standard required by Article 52 of the ICSID Convention for the annulment of an award. At most, they showed Spain’s mere dissatisfaction with the outcome.

This is Cuatrecasas’ second consecutive victory in ICSID annulment proceedings brought by Spain against awards in which it has been ordered to pay millions in compensation to foreign investors in the renewable energy saga.

“Once again, an ICSID ad hoc committee has confirmed that the objections raised by Spain in the annulment phase are limited to differences of opinion with the outcome of the award and, therefore, do not meet the standard required for annulment of an award under the ICSID Convention,” recalls Alberto Fortún, partner in litigation and arbitration.

Julia Gil