Developments in Sovereign Immunity as a Defence to the Enforcement of Investor-State Arbitral Awards

This post considers decisions concerning sovereign immunity as a defence to enforcement of investor-State awards under the ICSID Convention and the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“NYC”)—in particular, decisions issued this year in Australia, Singapore, and England and Wales, alongside older related decisions.

Read together, these decisions underscore various trends in enforcing investor–State awards across jurisdictions that have emerged: enforcement under the ICSID Convention remains relatively uniform and predictable, whereas enforcement under the NYC is subject to domestic rules on sovereign immunity and may diverge.

Sovereign Immunity and Enforcement under the ICSID Convention

In 2024, the UK Supreme Court confirmed that states cannot resist enforcement by invoking jurisdictional immunity, i.e., a State’s right to be immune from judicial proceedings in the courts of another State without consent (see Jurisdictional Immunities of the State (Germany v Italy), paragraph 113). In a recent 2026 decision, the Singapore High Court has similarly affirmed that jurisdictional immunity cannot be used to defeat enforcement of ICSID awards. Before turning to the Singapore decision, we first set out the position in England and Wales below.

UK Supreme Court’s 2024 Decision

In The Kingdom of Spain v Infrastructure Services Luxembourg S.À.R.L and anor; Republic of Zimbabwe v Border Timbers Ltd and anor, the UK Supreme Court (“UKSC”) considered two combined appeals by Spain and Zimbabwe seeking to resist enforcement of ICSID awards arising under the ECT and the Switzerland-Zimbabwe bilateral investment treaty (“BIT”), respectively.

The UKSC addressed the issue of whether the States had waived jurisdictional immunity under Section 2(2) of the UK State Immunity Act 1978 (“UK SIA”) by becoming parties to the ICSID Convention. The UKSC held in the context of an ICSID award that:

• under Section 2(2) of the UK SIA, the test for waiver of immunity requires a “clear and unequivocal expression” of the State’s consent to jurisdiction (see paragraph 69);

• in assessing whether such consent exists, no “magic words” like “waiver” or “submission” are required; rather, the test is whether the express words used “necessarily lead to the conclusion” that the State agreed to submit to the court's jurisdiction (see paragraph 69); and

• Article 54(1) of the ICSID Convention is incompatible with a State maintaining jurisdictional immunity in recognition and enforcement proceedings. By requiring each Contracting State to recognise and enforce ICSID awards as if they were domestic judgments, Article 54(1) amounted to “a clear and unequivocal submission to the adjudicative jurisdiction of the English courts” (see paragraph 97).

However, the UKSC refrained from deciding whether immunity was also waived by virtue of an agreement to arbitrate contained in a BIT (or a similar multilateral instrument) given its finding on waiver under the ICSID Convention. However, lower courts in PAO v Ukraine [2018] 1 WLR 5947 (UNCITRAL award) (see paragraph 27) and Gold Reserve Inc v Venezuela [2016] 1 WLR 2829 (ICSID award) (see paragraph 17) have recognised that a State’s entry into a BIT is a unilateral offer to arbitrate and capable of giving rise to waiver when accepted by the investor.

Singapore High Court’s 2026 Decision

In NextEra Energy v Kingdom of Spain, the Singapore High Court considered the registration and enforcement of an ICSID award against Spain. Notably, the Singapore High Court referred to two enforcement cases concerning ICSID awards rendered against Spain, including the English Court of Appeal decision in Infrastructure Services v Spain (see above for the UK Supreme Court decision).

As in the English proceedings, Spain’s primary argument before the Singapore court was that it enjoyed jurisdictional immunity.

The High Court examined whether Spain waived jurisdictional immunity by:

• ratifying the ICSID Convention; and

• entering into the Energy Charter Treaty (“ECT”).

The High Court found waiver on each of the above grounds.

• Spain submitted to the jurisdiction of the Singapore courts when it acceded to the ICSID Convention. The ICSID Convention constituted “an agreement in writing” and an “express submission to jurisdiction” for the purposes of Section 4(2) of the Singapore State Immunity Act 1979 (“SSIA”) (see paragraph 71).

• However, going beyond the UK Supreme Court’s decision in Infrastructure Services v Spain, the Singapore High Court held that Spain and the investors had entered into a valid arbitration agreement under Section 11 of the SSIA. The High Court considered that courts in Australia, England and Wales, and Singapore had previously found in the context of ICSID and UNCITRAL awards that the ECT contained a standing offer to arbitrate, which was accepted by the investors when they initiated arbitration (see paragraphs 6, 81–83; citing Kingdom of Spain v Infrastructure Services Luxembourg Sarl [2023] HCA 11; Blasket Renewable Investments LLC v Spain [2025] FCA 1028; Infrastructure Services Luxembourg SARL v Spain [2024] EWCA Civ 1257, and DNZ v DOA [2026] SGHC(I) 1). However, these cases did not ultimately turn on and decide whether entering into the ECT resulted in a waiver of state immunity.

The Singapore High Court’s reasoning—that entry into an investment treaty may waive jurisdictional immunity—could also be relevant to non-ICSID awards that are enforced under the NYC. NextEra Energy v Spain is significant because it confirms that Singapore’s position is in line with earlier decisions in England and Wales that a State’s entry into a BIT can give rise to waiver. This also brings Singapore’s position in line with the Quebec Court of Appeal decision in CC/Devas—although the position in Australia remains unresolved (see discussion below).

Sovereign Immunity and Enforcement Under the NYC

In contrast to the position under the ICSID Convention, the NYC is silent on sovereign immunity, leaving the issue to be determined under domestic law. In CC/Devas et al. v The Republic of India (“CC/Devas”) award, an UNCITRAL arbitration administered by the Permanent Court of Arbitration, various enforcement courts have grappled with the issue of waiver of jurisdictional immunity—with decisions emerging from Australia and England and Wales.

As we discuss below, CC/Devas did not consistently argue in enforcement proceedings that India waived its immunity by entering into the BIT. Instead, most enforcement courts focused on the narrow question of whether ratification of the NYC waives sovereign immunity. Moreover, this had to be analysed in the context of India’s “commercial reservation”, which limits the NYC’s application to disputes arising out of commercial relationships under Indian law.

• Canada, finding that India waived immunity by ratifying the NYC: Before the Canadian courts, the investors argued that India waived immunity by concluding the BIT and ratifying the NYC. In 2024, the Quebec Court of Appeal (“Quebec CA”) held that India’s entry into the BIT with a dispute resolution clause, its ratification of the NYC, and its participation in the arbitral proceedings together amounted to an express waiver of jurisdictional immunity (see paragraphs 78–81, 87).

  Different from other jurisdictions discussed below, the Quebec CA held that while Canada did not have an arbitration-specific waiver in its legislation, a State agreed to waive jurisdictional immunity when it entered into a BIT (see paragraphs 73-77, 82-84). Any other interpretation would allow a State to invoke immunity to defeat enforcement actions and deprive the NYC of any effect (see paragraph 81). In September 2025, the Canadian Supreme Court denied leave to appeal—meaning that the Quebec CA decision is the most authoritative consideration from the Canadian courts thus far.

• Australia, finding that investor-State awards are not “commercial” and no waiver from ratifying the NYC: The investors did not argue that India waived immunity by entering into the India-Mauritius BIT before lower courts.

  In January 2025, the Australian Full Federal Court considered the question of whether India waived immunity by ratifying the NYC. It held that the CC/Devas award fell outside India’s “commercial” reservation and India did not waive immunity by ratifying the NYC (see paragraph 3). The court emphasised that: (a) the award did not arise from a commercial relationship; (b) the BIT relationship was governed by public international law; and (c) the dispute concerned public-interest executive decisions (see paragraphs 79–81).

  While the investors attempted to introduce broader BIT-based waiver arguments in the Australian High Court appellate proceedings, those attempts were rejected (see paragraphs 18, 43–44).

  In April 2026, the Australian High Court (the highest court) issued its decision on the appeal—it referred to the English and Quebec CC/Devas enforcement decisions, which it interpreted to mean that a state’s ratification of the NYC would not, by itself, waive immunity (see paragraph 42). The NYC did not result in waiver because Article III preserves forum procedural rules, including immunity (see paragraphs 38–39). Furthermore, no analogy could be drawn with the ICSID Convention because: (a) the ICSID Convention expressly concerns disputes involving States; (b) Article 55 expressly preserves execution immunity (but not jurisdictional immunity); and (c) there was no indication that the International Law Commission viewed the NYC as comparable to the ICSID Convention (see paragraphs 46-49).

• England and Wales, finding no waiver from ratifying the NYC: While the investors did argue that India waived immunity by entering into the Mauritius-India BIT, the English High Court declined to address this issue because of ongoing set-aside proceedings in The Hague (see paragraph 88).

  In its decision in April 2025, the English High Court held that India’s ratification of the NYC did not amount to a waiver of sovereign immunity. The High Court considered that: (a) under English law, a waiver of sovereign immunity must be express and is to be construed restrictively against a state (see paragraphs 50 and 83); (b) the drafters of the NYC did not intend to “exclude immunity-based arguments in enforcement against states” (see paragraph 85); and (c) Article III of the NYC, which referred to “rules of procedure”, preserved sovereign immunity (see paragraph 87).

  In June 2026, the English Court of Appeal rendered the appellate decision in CC/Devas. It applied the same reasoning as the Australian High Court, finding that ratification of the NYC did not result in any waiver of sovereign immunity as it would under the Convention (cf Infrastructure Services above) and Article III preserved sovereign immunity (see paragraphs 46 and 76).

   

Conclusion

These recent decisions highlight the need for investor due diligence with differing enforcement frameworks. The ICSID Convention is more award-creditor-friendly: courts in England and Wales and Singapore have treated a State’s ratification of the ICSID Convention as a clear waiver of jurisdictional immunity. For non-ICSID awards enforced under the NYC, the availability and scope of any immunity defence depend on the enforcing forum’s domestic law.

The post only reflects the views of the authors, and not of their firm or the firm’s clients. This material is for general information purposes only and is not intended to constitute legal or other advice.