The Kingdom of Spain v Infrastructure Services Luxembourg S.À.R.L. and another [2026] UKSC 9

Spain and Zimbabwe, facing ICSID investment arbitration awards, sought to set aside their registration in the High Court on grounds of state immunity. The Supreme Court held that article 54(1) of the ICSID Convention constitutes a clear submission to jurisdiction under section 2(2) of the State Immunity Act 1978.

Background

These conjoined appeals concerned whether two foreign states, the Kingdom of Spain and the Republic of Zimbabwe, each the subject of adverse awards rendered under the 1965 Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the ICSID Convention), could rely on state immunity to set aside the registration of those awards in the High Court under the Arbitration (International Investment Disputes) Act 1966 (the 1966 Act).

Spain’s appeal

Infrastructure Services Luxembourg S.À.R.L. and Energia Termosolar BV (Infrastructure) claimed to have invested €139.5 million in a 45% shareholding in the Andasol solar power station in Granada, relying on Royal Decree 661/2007. They alleged that later regulatory changes breached the Energy Charter Treaty (ECT) and began ICSID arbitration under article 26 of the ECT. Spain challenged jurisdiction, arguing among other things that intra-EU claims under the ECT infringed article 344 TFEU. By an award of 15 June 2018 the tribunal rejected those objections and found that Spain had breached the fair and equitable treatment standard in article 10(1) of the ECT. Spain was ordered to pay €112 million plus interest and costs, later reduced by €11 million on rectification. Spain’s annulment application was dismissed on 30 July 2021. Cockerill J registered the award on 29 June 2021. Fraser J dismissed Spain’s application to set aside the registration on immunity grounds.

Zimbabwe’s appeal

Border Timbers Ltd and Hangani Development Co. (Private) Ltd (Border Timbers) claimed that their land investments in Zimbabwe had been expropriated without compensation. They arbitrated under article 10 of the Switzerland–Zimbabwe bilateral investment treaty. Zimbabwe maintained that it had never agreed to arbitrate with Border Timbers. The tribunal nonetheless awarded US$124,041,223 plus interest, US$1m in moral damages and costs, and the annulment application failed. Cockerill J registered the award on 8 October 2021. Dias J dismissed Zimbabwe’s set-aside application. She held that article 54(1) was a general waiver of immunity in international law but did not meet the threshold for submission under section 2 of the State Immunity Act 1978 (SIA 1978). She also held that registration was a purely administrative act.

Court of Appeal

The Court of Appeal (Flaux C and Newey and Phillips LJJ) dismissed both appeals. It held that registration engages adjudicative jurisdiction, a point not challenged further. It also held that article 54(1) is a prior written agreement to submit to the jurisdiction within section 2(2) of the SIA 1978, and is sufficiently express and clear. Zimbabwe’s reserved non-immunity defences were remitted to the Commercial Court. The Court of Appeal did not decide the section 9 arbitration exception or Spain’s intra-EU arguments.

The issues

Two issues were raised:

• Issue 1: By agreeing to article 54(1) of the ICSID Convention, did the appellant states submit to the jurisdiction of the English courts by prior written agreement within section 2(2) of the SIA 1978?
• Issue 2: Did the states agree in writing to arbitrate for the purposes of section 9(1) of the SIA 1978?

The Court heard two days of argument on issue 1 and found it unnecessary to hear argument on issue 2. The Court identified two sub-questions under issue 1:

• the domestic-law test for submission under section 2(2); and
• the correct interpretation of articles 53 to 55 of the ICSID Convention under customary international law rules of treaty interpretation.

The Court confined itself to immunity from adjudicative jurisdiction, not immunity from execution.

The Court’s reasoning

The test under section 2(2) of the SIA 1978

The parties differed on what an “express” waiver requires.

• The appellant states argued that words such as “waiver” or “submission” would ordinarily be needed. Mr Moollan KC for Zimbabwe accepted that waiver might be inferred only if the clause would otherwise be unworkable, meaningless or absurd. Mr Bastin KC for Spain argued that a necessary implication would be an implied term and not a valid waiver.
• The investors argued that “express” means clear when articles 31 and 32 of the Vienna Convention on the Law of Treaties are applied, and includes necessary implication from the words used.

Lord Lloyd-Jones and Lady Simler, giving the judgment of the Court, noted that section 2 itself does not use the terminology of express or implied submission. The appellant states relied principally on Lord Goff’s dissent in R v Bow Street Magistrate, Ex parte Pinochet (No 3) [2000] 1 AC 147. There Lord Goff concluded:

“In the light of the foregoing it appears to me to be clear that, in accordance both with international law, and with the law of this country, which on this point reflects international law, a state’s waiver of its immunity by treaty must … always be express. Indeed, if this was not so, there could well be international chaos as the courts of different state parties to a treaty reach different conclusions on the question whether a waiver of immunity was to be implied.”

The Court held that, “While a waiver of immunity must always be clear and unequivocal, we consider that Lord Goff took an unnecessarily narrow view of what may constitute an express waiver of immunity.” It gave three reasons.

1. Lord Goff’s judgment was a dissent. Lord Saville, in the majority, treated Chile’s consent to the Convention against Torture as an express waiver. He said he reached that conclusion not “by implying terms into the Torture Convention, but simply by applying its express terms.”
2. Lord Goff’s approach required an explicit reference to waiver. That is hard to reconcile with waiver by conduct, such as taking a step in proceedings. It also overlooked that waiver may follow from an express term which does not mention waiver, or as a necessary consequence of such a term. His approach was also inconsistent with NML Capital Ltd v Republic of Argentina [2011] 2 AC 495. There the Supreme Court held that a bond clause allowing a New York judgment to be enforced in other courts was a submission, despite containing no explicit waiver language. The Court rejected Spain’s attempt to distinguish NML on the basis of the separate express waiver clause. It also rejected Zimbabwe’s reading of Lord Phillips’ remark about robbing the provision “of all effect”: the finding of waiver “was held to be a waiver because this was the clear meaning of the express words used.”
3. Lord Goff’s sources did not support his narrow view. These were Oppenheim, the ILC commentary on what became article 7 of UNCSI, and Argentine Republic v Amerada Hess. The ILC commentary instead suggested that what matters is consent expressed “in a clear and recognisable manner”.

The Court endorsed the reasoning of Phillips LJ in General Dynamics United Kingdom Ltd v State of Libya [2025] EWCA Civ 134, including his statement in the present case:

“If the express words used amount, on their proper construction, to an unequivocal agreement by the state to submit to the jurisdiction, that is sufficient to satisfy section 2(2) of the SIA, even if the words ‘submit’ and ‘waiver’ are not used.”

The Court then stated the governing test:

“We consider that a waiver of immunity by treaty requires a clear and unequivocal expression of the state’s consent to the exercise of jurisdiction. Whether this exists depends upon an exercise of treaty interpretation in accordance with the treaty’s governing law, public international law. … Such an expression of consent does not require explicit words such as waiver or submission. Meaning is conveyed not only by the express words used but also by what is necessarily inherent in those words, and by what necessarily follows as a consequence of the use of those words. Accordingly, when considering the waiver of state immunity by treaty, the test is whether the words used necessarily lead to the conclusion that the state has submitted to the jurisdiction.”

The Court identified the ratio of Pinochet (No 3) as being that, between states party to the Convention against Torture, that Convention excludes immunity ratione materiae. It also drew support from the ICJ’s deduction in Bosnia v Serbia of a prohibition on states committing genocide from the express obligation to prevent it. The Court found it unnecessary to consider the wider implication of terms into treaties.

Ordinary meaning of articles 53 to 55

Applying articles 31 and 32 of the Vienna Convention, the Court reasoned from the text as follows.

• Article 53 makes awards binding and requires each party to comply.
• Article 54(1) obliges each contracting state to recognise and enforce the pecuniary obligations of awards as if they were final domestic judgments. On becoming a party, a state also consents to every other contracting state undertaking the same obligation. The Court observed: “On the face of it, this is inconsistent with the preservation of adjudicative immunity.”
• The scheme distinguishes recognition and enforcement from execution. Recognition and enforcement fall under article 54(1) and (2). Execution falls under article 54(3) and article 55. Article 55 expressly preserves only immunity from execution.

The Court explained why this matters:

“The absence of any preservation of adjudicative immunity in articles 53–55 accords entirely with the obligations in article 54(1) being fundamentally inconsistent with the maintenance of such immunity from adjudicative jurisdiction because the obligation to recognise and enforce an arbitral award as binding necessarily involves an exercise of adjudicative jurisdiction that must have overcome any jurisdictional bar to the exercise of that jurisdiction. Put another way, once there is a binding award, recognised and to be enforced like a final judgment, adjudication has already taken place and the scope for reliance on immunity from adjudicative jurisdiction has passed.”

The Court rejected four arguments advanced by the appellant states.

• Consent to other states’ obligations. Spain argued that one state need not consent to another acquiring treaty obligations. This ignored that consent to a treaty is consent to all its provisions as between the parties (article 17(1) of the Vienna Convention).
• Limiting article 54(1) to awards against investors. There was no basis for limiting article 54(1) to enforcement against investors, or by a state’s own courts. The article draws no distinction between investors and states.
• A mere obligation to create a mechanism. Article 54(1) does not merely require a domestic mechanism. It imposes an obligation of result. The Court stated: “a contracting state (such as Spain or Zimbabwe) cannot simultaneously agree that the United Kingdom ‘shall’ recognise and enforce an ICSID award rendered against them, whilst also claiming immunity from recognition and enforcement that would prevent the United Kingdom from complying with its own ICSID obligations.”
• The Arrest Warrant case. The appellant states relied on the ICJ’s statement in Arrest Warrant that “jurisdiction does not imply absence of immunity”. This did not assist them. The agreement here refers to “the end result of the adjudicative process. In order to reach that point immunity must necessarily have been overcome.”

The Court emphasised that no term was being implied:

“This conclusion does not involve reading in words or implying terms into article 54(1) of the ICSID Convention. The submission to jurisdiction on a reciprocal basis is deduced from the ordinary meaning of the express and unequivocal terms of article 54(1). On the face of the express words of article 54(1), consent to this provision could not be a clearer submission to the jurisdiction.”

Context, object and purpose

The treaty context reinforced this reading. Relying on Micula v Romania [2020] UKSC 5, the Court described article 54 as part of a self-contained scheme with these features:

• a recognising court cannot re-examine the merits of an award or refuse enforcement on public policy grounds;
• the article 54 duties are owed to all contracting states within “a network of mutual enforcement obligations”;
• article 27 supports this network of obligations; and
• article 69 shows that the scheme is concerned with achieving a result.

The availability of ICJ proceedings under article 64 did not show that the Convention works without a waiver. It showed that state compliance could not be assumed.

The Convention’s object was to encourage private investment by protecting against sovereign risk, as the preamble and the Addis Ababa record confirm. The appellant states argued that Pinochet (No 3) was an extreme case and that waiver arises only where the treaty would otherwise lose all effect. The Court rejected that argument:

“The immunity contended for would render valueless the protection which article 54(1) is intended to provide by making enforceable the pecuniary obligations imposed by an award as if it were a final judgment of a court in a contracting state. In this respect, the present case may not be as strong as Pinochet (No 3) but it is still compelling.”

In one respect the case was stronger than Pinochet (No 3). Article 7 of the Convention against Torture leaves a discretion to prosecute. Article 54(1) is an obligation of result, and “that obligation to treat an award as a judgment, the final product of the judicial process, is entirely incompatible with immunity from that judicial process.” The Court concluded that article 54(1) “is a clear and unequivocal submission to the adjudicative jurisdiction of the English courts”.

Supplementary means: travaux préparatoires

Recourse to the travaux préparatoires was unnecessary, but they confirmed the Court’s reading.

• The concerns raised by delegates, and Mr Broches’ explanations, related to immunity from execution. This led to the addition of article 55.
• The Report of the Executive Directors (para 43) confirmed that article 54 equates awards with final judgments but does not require forcible execution where judgments could not be executed.
• Nothing in the travaux suggested that immunity would bar the registration of an award.
• Although a principal purpose was enforcement against investors, the drafters always intended parity, so that article 54 would also operate against states. As the Court noted, article 55 would otherwise have been unnecessary.

Foreign decisions

The Court applied the principle of uniform interpretation of treaties. It noted a broad international consensus that article 54(1) waives adjudicative immunity:

• the High Court of Australia in Kingdom of Spain v Infrastructure Services Luxembourg [2023] HCA 11;
• Sodexo Pass International SAS v Hungary [2021] NZHC 371 (New Zealand);
• Von Pezold v Zimbabwe (Kuala Lumpur High Court); and
• Blue Ridge Investments LLC v Republic of Argentina (US Court of Appeals, Second Circuit).

The outlier, Tethyan Copper Co v Pakistan (BVI), was given little weight. It overlooked Pakistan’s agreement under articles 53 and 54(1) that other contracting states would recognise and enforce awards. The Court also refused recourse to Hansard, because the conditions in Pepper v Hart were not met.

Practical significance

The decision settles, at Supreme Court level, that a state party to the ICSID Convention cannot rely on immunity from adjudicative jurisdiction to resist registration of an ICSID award under the 1966 Act. Article 54(1) is a prior written submission within sections 2(2) and 17(2) of the SIA 1978. Immunity from execution remains preserved by article 55 and the SIA 1978, so recognition does not guarantee that the award will be paid.

More broadly, the judgment restates the test for waiver of immunity by treaty. Explicit words such as “waiver” or “submission” are not required. The question is whether the words used, properly interpreted under articles 31 and 32 of the Vienna Convention, necessarily lead to the conclusion that the state has submitted to the jurisdiction. This rejects the narrow approach in Lord Goff’s dissent in Pinochet (No 3).

The decision aligns English law with the international consensus among national courts. The Court expressly left open three matters:

• the section 9 arbitration exception, including whether the court must itself determine whether an arbitration agreement exists;
• Spain’s intra-EU objections; and
• the merits of Zimbabwe’s reserved non-immunity defences, which may fall within the exceptional defences recognised in Micula.

Verdict: The appeals of the Kingdom of Spain and the Republic of Zimbabwe were dismissed on the first issue. By agreeing to article 54 of the ICSID Convention, the appellant states submitted to the jurisdiction of the UK courts within section 2(2) of the State Immunity Act 1978. They therefore cannot oppose registration of the ICSID awards on the ground of state immunity. The Court found it unnecessary to decide issue 2 (section 9 of the SIA 1978) and expressed no view on the Court of Appeal’s conclusions on it. The Court of Appeal’s order remitting Zimbabwe’s set-aside application to the Commercial Court for directions on its non-immunity defences stands, with no view expressed on their merits.

Source: The Kingdom of Spain v Infrastructure Services Luxembourg S.À.R.L. and another [2026] UKSC 9