SPAIN Law and Practice Contributed by: Pablo Silván and Fernando Manzanedo, Ramón y Cajal Abogados, S.L.P.
1. Overview 1.1 National Position
modernising the treaty and its incompatibility with the EU’s energy and climate policy objectives, such as the European Green Deal. Spain’s actions reflect a broader EU trend toward reclaiming regulatory sovereignty and limiting investor privileges that conflict with public policy. For inves- tors, this means: • reduced treaty protection within the EU; • greater reliance on domestic legal remedies; and • heightened scrutiny of arbitration clauses in future treaties. Spain’s experience underscores the importance of assessing regulatory stability, especially in sectors like energy, infrastructure, and telecoms. 1.2 Arbitration Conventions Spain is a committed participant in the international arbitration framework and is party to the following conventions that govern the recognition and enforce- ment of arbitral awards. • Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention). Spain signed the New York Convention with no reservations or declarations (meaning it is applied broadly, including awards from non-member coun- tries). Spanish courts are generally supportive of enforcing foreign arbitral awards, provided proce- dural and public policy requirements are met. • ICSID Convention, which enables arbitration under its auspices. Spain has been involved in numerous ICSID cases, especially in the wake of its renew- able energy reforms. It has also participated in annulment proceedings and enforcement chal- lenges under ICSID rules. • European Convention on International Commercial Arbitration (Geneva Convention). Though largely superseded by the New York Convention, it still applies in specific contexts and complements Spain’s arbitration regime. 1.3 Prevalence of Investor–State Arbitration Spain’s jurisdiction offers a plurality of mechanisms for resolving disputes, and the choice often depends on their nature, the parties involved, and the applicable
Spain is a signatory to multiple bilateral investment treaties (BITs) and multilateral agreements and has been one of the most prominent respondent states globally, particularly under the Energy Treaty Charter (ECT). Following its rollback of renewable energy sub- sidies between 2010 and 2014, Spain faced more than 50 arbitration claims under the ECT (totalling more than EUR10 billion). Spain has consistently argued that the 2010–2014 renewables economic regime changes were neces- sary, proportionate, and in line with public interest, especially regarding energy market stability, and has challenged several awards in annulment proceedings, particularly under the International Centre for Settle- ment of Investment Disputes (ICSID). Spain has been ordered to pay hundreds of millions of euros in dam- ages, though many awards remain unpaid or under challenge. Following the Achmea, Komstroy and PL Holdings rulings from the Court of Justice of the Euro- pean Union (CJEU), Spain – alongside the European Commission – argues that intra-EU arbitration under the ECT is invalid. Spain has taken a clear and evolving stance on inves- tor–state arbitration (ISA), especially in the context of intra-EU BITs and the ECT. Spain’s policy has shift- ed significantly in recent years, driven by EU legal developments and its own experience as a frequent respondent in arbitration cases. • On 5 May 2020, Spain joined 22 other EU member states in signing the Agreement for the Termina- tion of Bilateral Investment Treaties Between the Member States of the European Union, a move that was a direct consequence to the Achmea judgment, which held that ISA clauses in intra-EU BITs are incompatible with EU law. The termina- tion agreement covers approximately 130 intra-EU BITs, including Spain’s treaties with countries like Germany, France, and the Netherlands. • Spain withdrew from the ECT, notifying its with- drawal on 16 April 2024, which took effect one year later, on 17 April 2025. The decision was taken by the Spanish government in view of the difficulty of
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