In Watkins Holdings v. Spain, a group of investors initiated arbitration against the Kingdom of Spain at the International Centre for Settlement of Investment Disputes (ICSID) under the Energy Charter Treaty (ECT). The Claimants, Watkins Holdings S.à r.l. (a Luxembourg entity), Watkins (NED) B.V. (a Dutch entity), and their Spanish subsidiaries, allege that Spain breached its obligations under the ECT through a series of regulatory reforms that dismantled the incentive regime for renewable energy. The investment concerned the acquisition of several wind farm projects in Spain, which the Claimants assert was made in reliance on the stable and predictable feed-in-tariff (FIT) framework established by Spain's Royal Decree 661/2007. The Claimants contend that subsequent measures, including the introduction of a 7% levy on electricity production and the eventual repeal of the FIT regime, frustrated their legitimate expectations and violated the fair and equitable treatment (FET) standard and the umbrella clause under ECT Article 10(1). Spain raised two primary jurisdictional objections. First, it advanced the "intra-EU objection," arguing that the tribunal lacks jurisdiction ratione personae. Spain contended that because the dispute is between investors from EU Member States (Luxembourg and the Netherlands) and another EU Member State, the ECT's dispute settlement provisions do not apply. According to Spain, EU law constitutes a self-contained legal order that supersedes the ECT for intra-EU relations, and disputes must be resolved within the EU's judicial framework. Second, Spain argued that claims related to the 7% levy on the value of electricity production (TVPEE) were inadmissible, invoking the taxation carve-out under Article 21 of the ECT. Spain characterized the levy as a bona fide taxation measure falling outside the tribunal's jurisdiction. The Claimants countered that the plain text of ECT Article 26 provides for Spain's unconditional consent to arbitrate disputes with an investor from "another Contracting Party," a definition that includes other EU Member States. They highlighted that numerous arbitral tribunals in similar cases against Spain have consistently rejected the intra-EU objection, noting the absence of any "disconnection clause" in the ECT that would oust the tribunal's jurisdiction. Regarding the tax objection, the Claimants argued that the 7% levy was not a genuine, bona fide tax but a disguised and discriminatory tariff cut specifically designed to reduce the guaranteed remuneration for renewable energy producers. As such, they contended the measure was an abuse of Spain's right to tax and that the carve-out in Article 21 was inapplicable. On the merits, Spain defended its measures as necessary and proportionate actions to address a severe economic crisis and an unsustainable tariff deficit in its electricity system. It argued that investors could not have a legitimate expectation of a static regulatory framework and that the only guarantee was a "reasonable return," which the new regime continues to provide. The case has since seen an award rendered, followed by annulment proceedings at ICSID. More recently, in May 2023, Spain filed an Application for Revision of the Award, leading the ICSID Secretary-General to provisionally stay the enforcement of the award pending the reconstitution of the tribunal.