Procedural Posture and Decision

This document is the Decision on Annulment issued by an ICSID ad hoc Committee in the case between NextEra Energy entities and the Kingdom of Spain. The Committee unanimously dismissed Spain's application to annul the Award of 31 May 2019, which had found Spain liable for breaching the fair and equitable treatment standard under Article 10(1) of the Energy Charter Treaty (ECT) and ordered it to pay damages of approximately EUR 290.6 million.

Annulment Grounds and Committee's Analysis

Spain sought annulment based on three grounds under Article 52(1) of the ICSID Convention: manifest excess of powers (Art. 52(1)(b)), serious departure from a fundamental rule of procedure (Art. 52(1)(d)), and failure to state reasons (Art. 52(1)(e)). The Committee systematically analyzed and rejected each of the twenty-two specific arguments advanced by Spain.

On the ground of manifest excess of powers, the Committee found that the original Tribunal's decisions on jurisdiction (ratione personae, materiae, and voluntatis) were tenable as a matter of law. This included the Tribunal's rejection of Spain's intra-EU objection, its interpretation of the denial of benefits clause under ECT Article 17, and its findings on the existence of an investor and an investment. The Committee emphasized that its mandate is not to review the correctness of the Award but to determine if an excess of power was manifest, a high threshold which Spain failed to meet. The Committee noted that the Tribunal's conclusions were consistent with those of numerous other ECT tribunals, reinforcing their tenability.

Regarding the alleged failure to state reasons, the Committee determined that the Tribunal had provided a rationale for its key findings that was sufficient for a reader to follow its reasoning. It held that a tribunal is not required to address every argument or piece of evidence presented by the parties. The Committee concluded that Spain's objections primarily targeted the adequacy and correctness of the reasoning, which are matters of appeal and fall outside the scope of annulment proceedings.

Finally, on the alleged serious departures from fundamental rules of procedure, the Committee found that Spain had waived several of its objections—including those related to an allegedly erroneous translation and late submissions—by failing to raise them promptly during the arbitration, as required by ICSID Arbitration Rule 27. For the remaining procedural arguments, the Committee found no departure that was both serious and from a fundamental rule of procedure, such as the right to be heard.

Operative Part and Costs

The Committee dismissed Spain's Application for Annulment in its entirety. Applying the 'costs follow the event' principle, the Committee ordered Spain to bear all costs of the annulment proceedings, including the Committee's fees and ICSID's administrative expenses, and to pay USD 3,500,000 towards the Claimants' legal fees and expenses, with interest.