Originally from Journal of Damages in International Arbitration

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I.  INTRODUCTION

On 4 May 2017, an arbitral tribunal composed of Professor John Crook (President), Dr Stanimir A Alexandrov, and Professor Campbell McLachlan QC issued an award in ICSID Case No. ARB/13/36, Eiser Infrastructure Limited and Energia Solar Luxembourg S.A.R.I. v. Kingdom of Spain.  The Tribunal awarded Claimants €128 million (plus interest) in total damages arising from Respondent’s violation of Article 10(1) of the Energy Charter Treaty (“ECT”) 1994 by failing to accord fair and equitable treatment to the Claimants. The Tribunal determined that each party should bear all of its legal and other expenses, and its respective equal share of the fees and expenses related to the Arbitration hearing.

II.  FACTUAL BACKGROUND

First Claimant is a private limited company incorporated under United Kingdom law, and is the general partner of five limited partnerships. Second Claimant is a private limited liability company incorporated under the laws of Luxembourg, and owns shareholdings and debt interests in two Spanish companies that own and operate three CSP plants in Spain.  First Claimant directly and wholly owns the Second Claimant (“Claimants”).  Respondent is the Kingdom of Spain. 

The case grew out of a failed investment in the Concentrated Solar Power (“CSP”) sector in Spain. CSP plants are large facilities that are expensive to build, requiring large initial capital investments.