SPAIN Law and Practice Contributed by: Pablo Silván and Fernando Manzanedo, Ramón y Cajal Abogados, S.L.P.
7. Other Procedural and Evidentiary Issues 7.1 Notice of Dispute and Consultation Period Spanish law itself does not impose specific require- ments regarding the notice of dispute or consulta- tion period. Instead, these pre-arbitration procedural requirements are typically governed by the applicable investment treaty (eg, BIT or EU agreement), the arbi- tration rules chosen (eg, ICSID or UNCITRAL) and/or any contractual provisions between the investor and the Spanish state or state-owned entity. Most BITs signed by Spain include pre-arbitration steps, such as notices of dispute, cooling-off periods and/or exhaustion of local remedies (though many modern BITs waive this last requirement). 7.2 Confidentiality and Transparency Balancing confidentiality with transparency in inves- tor–state arbitration under Spanish law is a nuanced challenge – especially when public funds, regulatory decisions, or environmental impacts are involved. Under the Spanish Arbitration Act (Law 60/2003) arbi- tration is generally private and confidential, unless parties agree otherwise. There is no statutory obliga- tion for transparency in investor–state disputes seated in Spain. However, public entities (like the Spanish government or state-owned companies) may be sub- ject to administrative transparency laws, such as the Ley de Transparencia, acceso a la información pública y buen gobierno (Law 19/2013), which requires disclo- sure of public spending and decisions. So, while the arbitration itself may be private, public accountability laws can compel disclosure of certain aspects – espe- cially if awards affect the state budget or regulatory frameworks. Spain is party to numerous BITs and EU treaties, and many of these encourage or require publication of awards, allow third-party participation (amicus curiae) and promote open hearings in certain cases. For example, UNCITRAL’s Transparency Rules (2014) apply automatically to treaties signed after April 2014 and can be adopted voluntarily in older treaties. These rules promote public access to documents, open
Although no landmark Supreme Court case has direct- ly ruled on the full scope of TPF in ISA, the Court has recognised the validity of funding contracts as long as they respect public policy and professional eth- ics and emphasised the importance of transparency and disclosure, especially when funders may influence litigation strategy. 6.3 Disclosure and Security for Costs Spain has emerging rules and practices requiring the disclosure of TPF in arbitration, particularly through institutional rules, and tribunals are increasingly factoring TPF into decisions on security for costs – though cautiously. While Spanish law does not mandate disclosure by statute, arbitral institutions in Spain do. The Span- ish Court of Arbitration and the Madrid International Arbitration Centre (CIAM) require parties to disclose the existence and identity of TPF to prevent conflicts of interest between arbitrators and funders, promote transparency and procedural fairness and ensure informed decision-making on costs and interim meas- ures. Additionally, Spain’s legal community is watching closely as the European Parliament pushes for a direc- tive that would regulate TPF across member states, including mandatory disclosure and limits on funder influence and remuneration. Spanish tribunals and courts do not automatically grant security for costs just because TPF is involved. Instead, they apply a case-by-case analysis, consid- ering financial standing of the claimant, risk of non- payment of adverse costs, whether or not the funder has explicitly committed to cover costs, and the evi- dence of bad faith or procedural abuse. In practice tribunals may request disclosure of the funding agree- ment to assess the funder’s obligations and remain reluctant to penalise funded claimants, unless there is a real risk that the respondent will be unable to recover costs if it prevails.
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