Flux européens

Nouvelle composition des chambres du Tribunal de l’Union européenne

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In Blasket Renewable Investments LLC v Kingdom of Spain [2025] FCA 1028 the Federal Court of Australia has confirmed the enforceability of 4 ETC awards against Spain viz its long-suffering renewable energy support schemes. The judgment has already been leaned upon in support in proceedings before the US Supreme Court and approaches the issues with similar lucidity as Fraser J in Infrastructure Services. 

Current post is by Claudia Wortmann, for which many thanks!! Geert.

 

*****

Blasket Renewable Investments LLC v Kingdom of Spain [2025] FCA 1028

In a single-judge decision in the Federal Court of Australia delivered on 29 August, Justice Stewart held four ICSID awards issued against Spain under the Energy Charter Treaty to be recognisable and enforceable. Each of the awards in 9REN, NextEra, RREEF and Watkins, brought by 9REN and NextEra, and by the assignee to the RREEF and Watkins matters were found to be enforceable pursuant to section 35(4) of the International Arbitration Act 1974 (Cth), federal legislation in Australia which provides for the enforcement of foreign arbitral awards.

Spain objected to the proceedings on a number of grounds, being:

1. Non-waiver of immunity: Spain argued that the Federal Court lacked jurisdiction as Spain did not waive its foreign State immunity under section 9 of the Foreign States Immunities Act 1985 (Cth). Readers may recall the Spain HCA case in which the High Court of Australia discussed the ICSID award in Spain v Infrastructure Services This time round, Spain argued that that the High Court’s findings in that matter – that Articles 53-55 of the ICSID Convention amounted to a waiver of foreign state immunity – were incorrect, to allow for the High Court to consider the matter of the ICSID Convention again.
2. The awards were said to be not ‘binding’ under Art 53 ICSID Convention, either: a. due to the intra-EU nature of the disputes and the primacy of EU law which means Spain owes no public international law obligation to comply with the awards, and if it did that would be an act of prohibited State aid under EU law; or b. because the ICSID dispute settlement provisions have been replaced by the EU court system by virtue of its accession to the Treaty of Lisbon, as either a modification under customary international law (VCLT Art 41) or Art 30 of the VCLT. As the awards are not ‘binding’ under Art 53 of the ICSID Convention, the court lacks jurisdiction to enforce them.
3. Assignment: Spain argued that it had no binding obligation to pay the assignee, Blasket, under Art 53 ICSID Convention, that Blasket has no standing under Art 54 ICSID Convention to seek recognition or enforcement because it is not a ‘party’, and that in the absence of a binding obligation of Spain to pay Blasket, s 35(4) of the IAA cannot apply, as there is no obligation to enforce an award brought by an assignee.
4. The Constitutional argument: Spain claimed that even if certification of the awards by the Secretary-General of ICSID were sufficient to prove their ‘binding’ nature, or to prevent the Court from investigating whether it is binding, then section 35(4) of the International Arbitration Act is invalid because it infringes CH III of the Australian Constitution.

 

The Court found that Spain did in fact waive its rights to immunity, the Court had jurisdiction to recognise and enforce the awards pursuant to s 35(4) of the IAA, and dismissed the EC’s application to intervene.

Non-waiver of immunity

As may be recalled, the High Court of Australia in Spain HCA had already found ([150] citing Spain HCA at [29]) that Spain had implicitly waived its foreign State immunity rights. The closed nature of the ICSID system was confirmed in Spain HCA and in Micula v Romania [2020] 1 WLR 1033 at [68]-[69] by the UK domestic courts. There was no reason to find that the award was not binding, as the ICSID system was a closed system, and that apparent conflicts with EU law were not relevant for the enforcement proceedings, as the awards were [174] ‘genuine, certified and authenticated awards’.

Spain’s argument, that ‘waiver of immunity in enforcement proceedings is limited to proceedings to enforce awards that are valid and binding’, had not been raised specifically in Spain HCA, however, the Court found [180] that

On the premise that the awards are binding on Spain, the proceedings are not outside the territory of what the parties accept was decided by the High Court. It follows that Spain’s contention of non-waiver of immunity to jurisdiction must be rejected.

Primacy of EU law

Spain argued that where there is a conflict between Spain’s obligations owed to other EU Member States under the EU foundational treaties, the primacy of EU law must prevail, and therefore, under public international law Spain owed no obligation to comply with the ICSID awards, and Australia owed no obligation to recognise or enforce them. Spain relied on the CJEU’s findings in Achmea and Komstroy in arguing that EU law prevents the application of the ECT between Member States, and it also argued that the public international law obligations would constitute illegal State aid between EU Member States. The Court found [118] that:

European law has undeniable domestic effect including through lower-level instruments of European law sourced in the authority of the foundational treaties… It suffices to say that while international treaties and subordinate EU instruments could be regarded as a form of international law, for the purposes of proof it would not be a form of international law incorporated into or picked up by Australian law in the sense contemplated in the authorities.

On this point, the Court [210] accepted expert evidence supplied by Professor Eeckhout on behalf of the Applicants, in the event of a conflict between international law and EU law,

the Member States must take the appropriate steps under international law to remove the conflicting international law obligation. In the meantime the conflicting clause remains valid and operative’.

Therefore, international law is applicable until withdrawal of the relevant treaty takes effect, which includes the ECT and the ICSID Convention, and [213]

it is no answer for Spain to say that it has some or other defence available to it under EU law, for it is not Australia which is under any supervening requirement of essentially foreign domestic public law to not comply

Spain was allowed to reopen the case for the purpose of submitting the Agreement on the Interpretation and Application of the Energy Charter Treaty between the European Union, the European Atomic Energy Community and their Member States (COM(2024) 257 final) (26 June 2024) (‘EU Inter Se Agreement’); and Declaration on the Legal Consequences of the Judgment of the Court of Justice in Komstroy and Common Understanding on the Non-Applicability of Article 26 of the Energy Charter Treaty as a Basis for Intra-EU Arbitration Proceedings [2024] OJ L 2024/2121 (26 June 2024) (‘EU Inter Se Declaration’).

The Court found that neither document materially added to Spain’s case, as

a) both came into existence long after the matters in dispute arose;

b) that removal of intra-EU disputes would be subject to future amendment of the ECT in accordance with the VCLT (in line with a separate declaration from Hungary, both an EU and ECT member);

c) neither the Agreement nor Declaration sought to amend the ICSID Convention; and

d) the substance of the Agreement and Declaration were not relevant to the enforcement proceedings as they both went to the interpretation and application of the ECT which is a question for ICSID tribunals, and not the enforcing Court.

The Court acknowledged that although there was a conflict between international law and EU law, it had no bearing on Spain’s public international law obligations or that it meant the ICSID awards were not binding.

Modification argument

Spain argued that the Treaty of Lisbon modified Art 43 ICSID Convention between EU Member States, meaning that tribunals have no jurisdiction over intra-EU disputes, and the Court lacked the power to enforce them, relying on customary international law to support its claim, because the ICSID Convention preceded the VCLT so the VCLT rules on successive treaties would not apply.

Spain argued that there are three requirements for custom to modify a treaty:

a) modification is not expressly prohibited by the treaty;

b) that modification does not affect the enjoyment of, and rights and obligations under the treaty by other parties;

c) the modification does not relate to a derogation provision which is incompatible with the object and purpose of the treaty.

The Court held:

• • the argument could only stand if Art 53 could be modified, and if Art 54 cannot give rise to enforceable obligations without a valid and binding award under Art 53, which was dismissed, given that the ICSID regime is a closed one. Further, there was no sufficient express or implied to modify the ICSID Convention between EU Member States or to render Art 53 inapplicable.
  • The modification also failed for lack of notice required under Art 41(2) to inform other parties to the treaty of the intention to modify it.
  • The type of rights that Spain sought to modify are erga omnes partes, owed to all parties to the treaty and not capable of modification under Art 41(1)(b)(i) VCLT. It would be an ‘inexplicable result’ if the enforcing State had an obligation to enforce an award, but the State subject to the award did not owe an obligation to all other State parties to comply with it.
  • The ICSID system and the structure of the Convention support construction of rights as erga omnes partes, supported by authorities including the UK Supreme Court in Micula. The Court also dismissed Spain’s reliance on the US enforcement proceedings for NextEra Energy Global Holdings BV v Kingdom of Spain 112 F4th 1088 (DC Cir 2024) that under Art 53 the obligation to comply was bilateral, and capable of being modified in a way which is not incompatible with the object and purpose of the ICSID Convention.
  • Modification by way of Art 30 VCLT on subsequent treaties, that the Treaty of Lisbon displaced the ICSID Convention also failed. Even if such displacement occurred, it was limited to the EU Member States and could not apply to Australia. Further, the principles relied on by Spain per the decision in Achmea and Komstroy were actually based on the EU foundational Treaty of Rome 1957, nearly a decade before the ICSID Convention came into force in 1965, making the ICSID Convention the subsequent treaty for Spain.
  • The EU treaties imposed no obligations which the CJEU had found to be in conflict with those of States under the ICSID Convention, which itself does not require parties to refer disputes to arbitration, hence the incompatibility was not [284] ‘at the level of obligations per se between the EU treaties and the ICSID Convention’.

Assignment

The Court made quick work dismissing Spain’s objection that the assignment of rights from RREEF and Watkins to Blasket was invalid. The Applicant argued successfully that the duty arose under s 35(4) IAA as Australia’s dualist system requires domestic enshrinement of international law obligations to make them enforceable. Under domestic law, in Australia the rights of enforcement for an arbitral award are also capable of being assigned. So in either case, Spain’s argued failed. Justice Stewart was not convinced by Spain’s argument that allowing enforcement by an assignee would allow for double recovery.

EU status of Jersey and Constitutional argument

This argument relating to only the RREEF enforcement proceedings, as an alternative argument by the Applicant in respect of the EU nationality of the investors. Blasket argued that, in the event that Spain’s intra-EU objections were upheld, that the investor in RREEF, being domiciled in the Bailiwick of Jersey, a British Crown Dependency and one of the Channel Islands, should not be prevented from enforcing that award. Justice Stewart agreed, finding the investor in RREEF was not a national of an EU Member State.

Constitutional argument

The Court held that although Art 54 ICSID Convention as implemented by s 35(4) IAA, requires the Court to recognise and enforce any ICSID award as binding within Australia as judgment of that court, this does not ‘impermissibly vest constitutional powers in either the ICSID tribunal or the Secretary-General, nor does it substantially impair the institutional integrity of the Court as a constitutional court by requiring it to find a waiver of foreign state immunity or by recognising or enforcing an award.  

EC application to intervene

The European Commission sought leave to intervene in the proceedings, supported by Spain, which was denied by the Court. The EC application sought to make two submissions: a) Spain’s submissions are an accurate description of EU law, and EU law prevents any payment under the awards as illegal State aid; and b) any payment made by Spain under the ECT awards would being subject to significant ongoing fines until such payment were recovered. The Court accepted that Spain’s submission on EU law may indeed be accurate, but as the ‘crux’ of the proceedings were on (at [361]) ’ the effect of EU law on public international law binding Australia’, such accuracy had no impact on the Court’s findings. On the second point Stewart J stated at [362]:

while the questions raised are no doubt interesting, as explained above, they are irrelevant on an application for recognition and enforcement of an arbitral award in circumstances where I have concluded, notwithstanding the identified consequences extant in and arising from EU public law, the Court is bound to give effect to the award in accordance with public international law and Australian domestic law.

 

In sum, Stewart J dismissed Spain’s arguments from the outset, finding that most of them were similar enough to those put forward in Spain HCA to warrant the application of precedence. Even so, His Honour considered and dismissed each of Spain’s alternative arguments in succession, reaffirming that ICSID awards can and will be enforced in Australia, and that the influence of EU law principles remains minimal in this context.

Claudia.

 

WebGroup Czech Republic et NKL Associates
Avocat général Szpunar : une mesure constituant un corollaire des dispositions du droit pénal ou nécessaire afin d’assurer l’efficacité des contrôles routiers relève du principe du pays d’origine prévu par la directive sur le commerce électronique

Élection des juges appelés à exercer les fonctions d’avocat général au sein du Tribunal pour le traitement des demandes de décisions préjudicielles

Élection des présidents de chambre du Tribunal de l’Union européenne

M. Savvas Papasavvas est réélu vice-président du Tribunal de l’Union européenne

M. Marc van der Woude est réélu président du Tribunal de l’Union européenne

Entrée en fonctions de nouveaux membres à la Cour de justice et au Tribunal de l’Union européenne et renouvellement partiel du Tribunal

Aucrinde
Espace de liberté, sécurité et justice
Avocate générale Ćapeta : la Charte n’interdit pas d’établir la paternité par prélèvement génétique post mortem

Bervidi
Politique sociale
Discrimination au travail : la protection des droits des personnes handicapées contre les discriminations indirectes s’étend aux parents d’enfants handicapés

MSIG
Principe ne bis in idem : une personne ne peut être poursuivie dans un État membre pour un acte de terrorisme lui ayant déjà valu une condamnation dans un autre État membre, bien que la qualification de l’infraction y soit différente

Banco Santander (Résolution bancaire Banco Popular III)
Libre circulation des personnes
Banco Popular : les droits découlant des actions en nullité et en responsabilité introduites avant la résolution de cette banque sont opposables à Banco Santander

Autriche / Commission (Centrale nucléaire Paks II)
Aide d'État
La Cour de justice annule la décision de la Commission approuvant l’aide de la Hongrie pour la centrale nucléaire Paks II

Positive Group / Conseil
Politique étrangère et de sécurité commune
Guerre en Ukraine : le Tribunal confirme les mesures restrictives contre Positive Group PAO, une entité active dans le secteur russe des technologies de l’information et titulaire d’une licence délivrée par les services de renseignement intérieurs russes

Meta Platforms Ireland / Commission
Rapprochement des législations
Règlement sur les services numériques : le Tribunal annule les décisions de la Commission fixant la redevance de surveillance applicable à Facebook, Instagram et TikTok

Autriche / Commission
Le recours de l’Autriche contre l’inclusion de l’énergie nucléaire et du gaz fossile dans le régime des investissements durables est rejeté

Advocate General Norkus opined early July in Case C-485/24 Locatrans Sarl v ES. At issue is the application of the protective regime for lex contractus viz employees under the Rome Convention (applicable ratione temporis in the case at issue).

The facts of the case echo, but with distinctions, CJEU Weber, Koelzsch, and  Voogsgeerd, as well as Nogueira (Ryanair). The novelty of the question in current case is the period of work to be taken into account in determining which law is applicable if the employee has worked for his or her employer in two separate stages: first, in several States and next, during the period preceding the end of the employment relationship, on a permanent basis in a single State, which parties clearly intend to be the new place of habitual performance.

The opposing views are summarised (23):

Referring to the judgment in Weber, Locatrans and the Czech Government submit, inter alia, that where the employee carries out the same activities for his or her employer in more than one State, account must be taken of the whole duration of the employment relationship in order to identify the place where the person concerned habitually worked and, consequently, the law applicable in the absence of a choice made by the parties. For its part, the French Government considers that, that being the case, the most recent period of work could be taken into account in order to determine, in the light of all of the relevant circumstances, the existence of closer connections with another country. By contrast, ES maintains, as a preliminary point, that, despite the wording of the question referred for a preliminary ruling, he did not change his place of work during his employment relationship. He submits, therefore, that his situation is clearly distinguishable from that which gave rise to the judgment in Weber, where the worker had performed his duties successively in two different places of work. In any event, even if the judgment in Weber were to be held to be relevant to the present case, ES argues that reference must be made to the most recent period of work. For its part, the Commission maintains that, in a case such as that at issue in the main proceedings, in which the dispute concerns the termination of the contract and where the relevant facts for the purposes of coming to a judgment arise at the end of the contract, account must be taken of the most recent period of work.

(36) the core rule per Koelzsch is

‘the country in which the employee habitually carries out his [or her] work in performance of the contract’ is that in which or from which, in the light of all of the factors which characterise that activity, the employee performs the greater part of his or her obligations towards his or her employer’

In footnote the AG adds that what must be at the heart of the national court’s assessment is the activity of the worker and not that of the employer (for which he refers to the Handbook, much obliged and humbly noted).

Having summarised the relevant case-law, (51) the Opinion takes a decisive turn when the AG refers to the need to interpret the regime with stability in mind:

[I] would point out that, in so far as the employment relationship is a permanent one, the elements characterising that relationship, such as the performance of work, the place of performance of the work or the remuneration, may change. In particular, in a cross-border employment situation, the country where the employee ‘habitually carries out his [or her] work’ may also change depending on changes in objective circumstances. In other words, the law applicable in the absence of a choice made by the parties may change due to the very nature of the employment relationship, which continues over time. However, since one of the objectives of the Rome Convention is to fortify confidence in the stability of the relationship between the parties to the contract, a change in the applicable law resulting from changes in factual circumstances must also be the result of a clear intention on the part of the parties. That change must not affect legal relationships which arose prior to that change, so that, rationae temporis, the dispute remains governed by the law applicable at the time those circumstances arose (tempus regit actum). (footnotes omitted)

Tempus regit actum is a principle with direct appeal and application for procedural law, for issues of intertemporary law (scope of application ratione temporis, particularly of statute) and for formal validity in private international law. Its application for substantive provisions in private international law is less obvious (there are traces of it of course in Rome I’s Article 3(2) on voluntary change of applicable law, Article 11’s formal validity, and Article 13 incapacity).

For employment contracts, in my opinion the very first agreed “place from where the employee habitually carries out his work” must be seen as an implicit mutual choice of law, and any mutually agreed (or at least  transparent and uncontested) change in said place, as an implicit change in that choice of law. Article 3(2) must then be applied mutatis mutandis

The parties may at any time agree to subject the contract to a law other than that which previously governed it, whether as a result of an earlier choice made under this Article or of other provisions of this Regulation. Any change in the law to be applied that is made after the conclusion of the contract shall not prejudice its formal validity under Article 11 or adversely affect the rights of third parties.

(52) the AG follows a similar approach focused on deciding what it is the parties are actually litigating about, to then fix the lex causae applicable to the claim, to the relevant, mutually agreed, place of habitual employment in force at the time:

In the light of the foregoing, the essential question is what is, in the present case, the relevant criterion for determining, in concreto, the point in time at which the subject matter of the dispute arose in order to identify the place where the employee habitually carried out his work and, consequently, the law applicable in the absence of a choice made by the parties.

(54) the AG like the Commission identifies the nature of the claim as one in which the employee’s dispute concerns the termination of the contract. The facts relevant to the determination of that dispute in casu it seems arise at the end of that contract, hence the most recent period of employment (with fixed place of employment in France) should be taken into account to determine the lex causae. (57) Gleichlauf is mentioned as one of the reasons for suggesting so.

If followed by the CJEU, a sophisticated litigant could of course abuse this approach to formulate their claim in such a way as to lead to an attractive applicable law. However as a general rule the approach seems a solid one to me.

Geert.

EU Private International Law, 4th ed 2024, 3.39 ff.

Opinion Norkus AG this morningFavor laboris in Rome Convention, applicable lawPlace of habitual place of employment must focus on most recent period if place has become fixed, by mutual agreementC‑485/24 Locatrans curia.europa.eu/juris/docume… (citjng ia your truly – sincerely humbled)

— Geert Van Calster (@gavclaw.bsky.social) 2025-07-03T11:57:31.029Z

Puigdemont i Casamajó e.a. / Parlement (Levée de l’immunité parlementaire)
L’avocat général Szpunar propose de rejeter trois moyens du pourvoi introduit par M. Antoni Comín contre l’arrêt du Tribunal rejetant son recours contre la levée de son immunité par le Parlement européen

Shipov
Avocat général Richard de la Tour : l’État membre d’origine d’une personne transgenre a l’obligation de délivrer des documents d’identité conformes à l’identité de genre vécue

Safi
Avocate générale Ćapeta : la citoyenneté de l’Union englobe le droit de ne pas circuler