In May 2018, Spain requested the set-aside of an arbitral award in front of the Swedish Svea Court of Appeal. In the award, the SCC tribunal had granted the Luxembourg company, Novenergia, EUR 53.3 million in damages on the grounds that Spain had, as an effect of Spain’s reform to its renewable energy subsidy regime, violated standards of fair and equitable treatment under the Energy Charter Treaty (ECT). Novenergia was awarded damages in relation to its investments in eight photovoltaic plants in Spain before the reform.[1] The arbitral award was issued less than a month before the Achmea ruling, in which the CJEU decided that an investor-state arbitration clause in the Netherlands-Slovakia bilateral investment treaty (BIT) was incompatible with EU law and thus invalid.[2]

Spain challenged the award inter alia on the ground that the tribunal lacked jurisdiction. Already in the petition to the Svea Court of Appeal, Spain requested a preliminary ruling from the CJEU in order to clarify whether the arbitration clause in Article 26 of the ECT is applicable between the member states of the EU, and if so, whether Article 26 of the ECT is compatible with EU primary law. Spain argued, inter alia, that the Achmea ruling is not only relevant to BITs but also to multilateral treaties, as the ECT, when a tribunal is to interpret and implement EU law and that it was urgent to remediate the uncertainty in the area. In April 2019, the Court of Appeal rejected the request arguing it was currently not motivated to obtain a preliminary ruling.[3]

Recently, on the 27 of May 2020, Spain’s second preliminary ruling request was rejected by the Svea Court of Appeal on the same grounds as its first decision.[4] During the process, the European Commission requested on its own initiative to intervene amicus curiae regarding aids granted by States[5] and in the same decision by the Svea Court of Appeal, the European Commission was provided the opportunity to submit a written statement.[6] The Svea Court of Appeal has not yet determined if a main hearing is to be held, but a preliminary hearing for the case is scheduled in September 2020.

 

[1] The final arbitral award, SCC Arbitration, 15 February 2018, Case No 2015/063, Novenergia II – Energy & Environment (SCA) (Grand Duchy of Luxembourg), SICAR v. The Kingdom of Spain.

[2] The Achmea case, 6 March 2018, Case no. C 284/16.

[3] Decision of the Svea Court of Appeal, 25 April 2019, Case No. T 4658-18.

[4] Decision of the Svea Court of Appeal, 27 May 2020, Case No. T 4658-18.

[5] Pursuant to Article 29.2 in the Councils Regulation 2015/1589 of 13 July 2015 and Article 107 and 108 TFEU.

[6] Decision of the Svea Court of Appeal, 27 May 2020, Case No. T 4658-18.