Assignment of ICSID awards before the English courts: Operafund v Spain
Introduction
After an investor prevails in an ICSID arbitration, the next objective is to obtain payment of the award. States sometimes comply voluntarily, but not always. To collect payment, the creditor must enforce such award before national courts. Enforcement may be a burdensome and protracted battle with more legal fees involved. This could entail being out of pocket for a significant time. To address this risk, creditors sometimes prefer assigning their recovery rights in exchange for an earlier and reduced payment.
Although on occasions the assignment of ICSID awards has been accepted by national courts, the English High Court (“HC”) held that such assignment is not allowed (Operafund Eco-Invest SICAV Plc & Schwab Holding AG v Kingdom of Spain [2025] EWHC 2874 (Comm)).
In reaching its decision, the HC analysed the requirements for issue estoppel concerning foreign judgments, interpreted the ICSID Convention using the Vienna Convention on the Law of Treaties (“VCLT”), analysed principles of customary international law (“CIL”), and the assignability of English litigation rights deriving from an ICSID award.
In this piece, we start with a factual summary of the dispute. We proceed to set out the Court’s decision. We then conclude that the decision provides clarity on the assignability of ICSID awards under English law and the requirements for issue estoppel of foreign judgments involving foreign states.
Factual Summary
Between 2008 and 2009, Operafund Eco-Invest SICAV Plc and Schwab Holding AG (the “Claimants”) invested in Spanish solar energy projects relying on Spain’s representations to maintain fixed tariffs. Spain revoked those tariffs years later, prompting the Claimants to commence arbitration under the Energy Charter Treaty (“ECT”) and the ICSID Convention.[1]
In September 2019, an ICSID tribunal awarded the Claimants approximately €29.3 million. The HC issued an order registering the award under the Arbitration (International Investment Disputes) Act 1966 (the “1966 Act”), granting it the same force and effect as an English court judgment.[2] Spain applied to set aside the HC registration order based on state immunity grounds.[3]
In 2024, the Claimants purported to assign the award to the company Blasket Renewable Investments LLC (“Blasket”). Blasket then applied under Civil Procedure Rule (“CPR”) 19.2(4)(a) to be substituted as claimant in the English proceedings. Spain opposed the substitution, arguing that ICSID awards are non-assignable under s.1(1) of the State Immunity Act 1978 (“SI Act”).[4]
Before the HC determined Blasket’s application, the Federal Court of Australia decided that the substitution was valid under Australian law. Relying on this foreign judgment, the Claimants argued that Spain was barred by issue estoppel from relitigating the assignability point.
The HC faced two issues. First, whether the Australian judgment stopped Spain from relitigating the assignment. Second, whether the ICSID award was assignable under the ICSID Convention, ECT, CIL, and English law.
The Court’s decision
Issue Estoppel
The HC held that Spain was not estopped from opposing the assignability allegation. For issue estoppel to arise, the test required that:
(1) the judgment had to be issued by a court with jurisdiction;
(2) the judgment be final and conclusive;
(3) there should be identity of parties in the foreign proceedings and in the local proceedings;
(4) identity of the issue resolved in the foreign proceedings and the issue in the local proceedings; [5] and
(5) since the respondent was a state, s.31 of the Civil Jurisdiction and Judgments Act 1982 (“1982 Act”) provided for two additional requirements:
(a) that the judgment would be so recognised and enforced if it had not been given against a state (s.31(1)(a) of the SI Act); and
(b) that the English court would have had jurisdiction for such judgment per sections 2 to 11 of the SI Act (s.31(1)(b) of the SI Act).[6]
The Australian judgment did not comply with point (2) because it had not been memorialized in a final order. Nevertheless, the HC considered that it could proceed with its decision.[7]
The HC put particular emphasis on the 1982 Act’s requirements. s.31(1)(b) of the SI Act concerns whether the English court has jurisdiction over a state based on a general exception to state immunity. s.31(1)(a) relates to inter alia whether the debtor submitted to the foreign court’s jurisdiction to make the judgment enforceable in England.
The HC decided that s.31(1)(b) of the SI Act was met in light of a previous judgment of the English Court of Appeal (“CA”) on Infrastructure Services Luxembourg Sarl v. the Kingdom of Spain [2024] EWCA Civ 1257; [2025] 2 WLR 621. There, the CA found that ICSID awards can be enforced in all other ICSID convention states and thus fell within the exception to general immunity under s.1(1) provided for in s.2 of the SI Act.[8] Since the Infrastructure decision is under appeal before the English Supreme Court, the HC held that if Infrastructure is overturned, Spain could argue in the set aside proceedings against the registration order that the Operafund award does not fall within the exception to general immunity.[9]
Concerning s.31(1)(a) of the SI Act, the HC expressed that for a foreign court’s judgment to be enforceable in England and Wales, the debtor had to be present or had submitted to the foreign court’s jurisdiction. Pursuant to s.33 of the Act 1982, if the debtor only appeared before the foreign court to challenge its jurisdiction, this would not amount to submitting to it.[10] On this point, the HC found that Spain only appeared in the Australian proceedings to contest jurisdiction. The Australian judgment was thus not enforceable in England under s.33 of the 1982 Act and s.31(1)(a) of the 1982 Act was not satisfied.
Thus there was no issue estoppel and Spain was able to challenge the assignability point even when such an argument had been rejected in the Australian proceedings.
Assignability of the ICSID Award
The HC proceeded to analyse whether the ICSID award was assignable under the ICSID Convention, ECT, CIL, and English law.
The HC interpreted the ICSID Convention and ECT using VCTL’s articles 31–32.[11] The HC noted that the ICSID Convention did not address assignability of rights. The Claimants argued that awards may be assigned since the ICSID Convention or ECT did not prohibit assignment.
- Under the ICSID Convention and ECT
Regarding the ICSID Convention, the HC gave particular attention to art. 54(2) of the ICSID Convention which provides that “a party seeking recognition or enforcement in the territories of a Contracting State shall furnish to a competent court […] a copy of the certified award”. The Claimants alleged that since the ICSID Convention provides for “a party to the dispute” in other articles, art.54(2) was open to any party (as opposed to only a party to the arbitration). Under the Claimants’ logic, this meant that assignment was allowed, but the HC was not convinced. Applying a contextual interpretation and secondary sources, the HC decided that the wording “the parties” or “a party” only meant the parties to the arbitration.[12] The HC held this interpretation aligned with the restrictive approach required when applying VCLT principles.[13] The HC further found that the contextual interpretation of the treaty was also sufficient to dismiss the Claimant’s arguments that a contrary interpretation would render provisions of the ICSID Convention surplus.
On the ECT, relying on VCLT and scholars, the HC found that the ECT’s claims are not assignable. The ECT only provides for subrogation of rights by the investor’s state, which is different from the assignment of rights to a non-state entity.
- Under CIL
Concerning CIL, the Claimants argued that the ICSID award was assignable under CIL. The HC disagreed. The HC stated that for a rule of CIL to exist, there must be “widespread, representative and consistent practice of states”.[14] The HC found no practice regarding the assignability of an ICSID award.[15] Spain argued that a right to assign can only be expressly given by the ICSID Convention. On this argument, interestingly, the HC expressed that Spain’s allegation was undermined because Spain did not plead such point in the Australian proceedings.[16]
In rejecting the Claimants’ argument, the HC disagreed with the United States District Court for the Southern District of New York’s judgment in Blue Ridge Investments LLC v Republic of Argentina (Memorandum Opinion & Order), 10 Civ. 153 (PGG). There, the SDNY Court confirmed that an ICSID award against Argentina was validly assigned. However, the HC held that such a judgment was not applicable because the SDNY Court applied United States law, as opposed to the VCLT, to interpret the ICSID Convention.[17] The HC thus found the case did not reflect the CIL practice.[18]
The HC also rejected the contention that municipal law had to resolve the ICSID Convention’s gap in addressing assignment.[19] Such contention was accepted by the Federal Court of Australia in CC/Devas (Mauritius) Ltd. v Republic of India (No 2) [2023] FCA 527, which in turn relied on Blue Ridge. The HC disagreed on the basis that such logic would undermine uniformity in the application of the ICSID Convention by allowing assignment in some jurisdictions but not others.[20]
- Under English law
The final point that the HC resolved was whether the ICSID award litigation rights in England (arising from the commencement of the English proceedings) were assignable under English law.
The HC rejected the argument that registration under the 1966 Act created independent domestic rights capable of assignment. In the HC’s words: “registration does not render assignable what is not assignable under the ICSID Convention, merely because the benefit of a High Court judgment is capable of being assigned […] If the Award is non-assignable, that cannot be changed by registration.”[21]
Commentary
Contrary to the decision in other jurisdictions, the HC’s decision in OperaFund v Spain brings clarity to investors and third parties seeking to assign rights of ICSID Convention awards in England. Unless overturned on appeal, it limits the tradability of ICSID awards and confirms that the enforcement of awards in England remains a matter between the original investor and the respondent state.
In rejecting the Blue Ridge decision, the HC sends out a consistent message that in England and Wales, treaties such as the ICSID Convention will be interpreted under the VCLT as opposed to domestic national interpretation tools. This point was also addressed in the CA’s case Republic of Korea v Elliott Associates LP [2025] EWCA Civ 905, where the CA held that domestic considerations are irrelevant when interpreting international treaties.
The HC’s ruling also provides further guidance on the requirements for issue estoppel for foreign judgments, especially when the respondent is a state. This decision further complements the English international litigation analysis of issue estoppel. Recently, the English court set out the requirements for issue estoppel regarding unconfirmed awards given in Eletson Gas LLC v A Ltd & Ors [2025] EWHC 1855 (Comm). Our firm acted in this latter case, successfully arguing that issue estoppel did not apply to the relevant award.
[1] OperaFund Eco-Invest SICAV PLC & Anor v Kingdom of Spain [2025] EWHC 2874 (Comm) at [7].
[2] Id. at 9.
[3] Id. at 10.
[4] Id. at 9-10.
[5] Id. at 16.
[6] Id. at 22.
[7] Id. at 6.
[8] Id. at 14.
[9] Id. at 22.
[10] Id. at 24.
[11] Id. at 39.
[12] Id. at 43.
[13] Id. at 44.
[14] Id. at 54.
[15] Id.
[16] Id. at 59
[17] Id. at 64
[18] Id. at 66
[19] Id. at 67
[20] Id. at 68
[21] Id. at 76, 78.
