Instituto Cervantes: UK once opposed arbitration used by its judge to seize assets from Spain | Economy

In its day, the United Kingdom clearly took a stand against the arbitrary use of international arbitration awards, contrary to the standards that a British judge just this week ordered the seizure of the assets of the Spanish state – specifically, bank accounts in its territory from the Cervantes Institute or the foreign agency Acció, affiliated with the Catalan general. Because of the discount…

In its day, the United Kingdom clearly took a stand against the arbitrary use of international arbitral awards, contrary to the standards that a British judge just this week ordered the seizure of the assets of the Spanish state – specifically, bank accounts in its territory from the Cervantes Institute or the foreign agency Acció, from the Generalitat de Catalunya – Because of the reductions imposed on their daily renewable energy premiums. On January 15, 2019, when Brexit was still a mess to be negotiated and the country was still part of the Community Club, the British representative to the European Union signed a formal declaration, along with its 21 members. Else, they agreed. To eliminate all arbitration mechanisms that international investors can use as a result of bilateral treaties between countries involving millions of dollars in compensation to international funds.

Union law takes precedence over bilateral investment treaties concluded between member states. Accordingly, all arbitration terms are between investors and the state […] “It is not applicable,” the document states.

The signatory states went further, as EL PAÍS reported at the time, and asserted that arbitration derived from the Energy Pact was also inconsistent with community law. That was the international treaty in which international arbitral awards were upheld to rule against Spain. The European Court of Justice established the principle of community in March 2018, in what is now known as the “Achmea case ruling,” by setting arbitration clauses contained in some bilateral treaties between EU countries that conflict with European laws. Soon after, another arbitrator, called the “Mikola Judgment”, ended the play by saying that it would also be against community law to enforce those arbitral awards.

This ruling endangered the acquittal of a large part of the plaintiffs in energy litigation, who were seeking $1 million in damages from Spain after lowering renewable energy premiums. However, at the time, legal experts downplayed the ruling, since many of the claims against Spain were based on the Energy Charter. Almost two months later, Spain’s arbitration court ordered the payment of 60.5 million euros in compensation to the Dutch company Masdar Solar & Wind Cooperatief, which had invoked the protection mechanism provided for in that treaty.

British judge v. Cervantes

In recent years, many critical legal scholars have pointed out that British justice is in danger of becoming a “mini-justice”, which a select group of funds or individuals can access to either obtain a multimillion-dollar divorce or a coup d’état against a third country. . Justice Andrew Baker, of the High Court of Justice in London, who had already accepted the registration of the arbitration award in favor of IR and against Spain a month ago, thus awarding it the value of the judgment, decided this week to impose three interim orders for payment against the assets of the Spanish state. Specifically, it decided to seize the accounts in British territory of all Cervantes’ institutes in the United Kingdom – London, one of the jewels of Spanish culture abroad, Leeds and Manchester – and the accounts of Acció, the competitiveness agency of the Generalitat de Catalunya, set up in the building where the delegation is located. The Catalan executive on Fleet Street, in the British capital. It’s “extremely precautionary measures” approved, plus, in this case, “unheard of.” That is, without paying attention to the explanations of the state prosecutor, and in response to an alleged emergency. A decision, suggests the experts consulted by EL PAÍS, whose application is expected to be brought before against a Russian oligarch on the verge of escaping justice and not against a sovereign partner and friendly country.

The plaintiff is an investment fund located in the US tax haven of Delaware, Blasket Renewable Investments LLC, which won rights to the vast majority of arbitral awards against Spain in a renewables matter that could involve more than €1,000 million.

The Foreign Office’s Diplomatic Information Office, which confirmed the blocking of Cervantes’ accounts, said that “the country’s legal services are working alongside local UK law firms to determine appropriate defensive measures.” institute.

On a rental basis

Although he granted a two-month truce to both Cervantes and Acció to decide whether or not to advocate “state immunity”, before proceeding to take possession of their premises, Justice Baker seems unaware that the two London sites are in a state of lease.

The Ministry of Environmental Transformation and Demographic Challenge announced its intention to appear before the High Court in London, both in the main proceedings and in the annexes and confiscation of assets. The Spanish government has not yet been notified of the enforcement of the arbitral award.

“We are preparing the legal reaction to defend the interests of the state, and we are analyzing the situation in detail pending notification. Sources in the ministry confirmed, as always, to work with absolute precision, in accordance with the law, while respecting the framework of society and giving priority to defending the interests of the state.” Among other things, the matter must be reported to the European Commission, because “the payments may be contrary to EU law and constitute illegal state aid,” as laid out in the ruling in the “Achmea case.”

The Spanish government had already approved a Royal Decree in 2019, to “restore investor confidence,” which granted those affected by the cuts a guaranteed return of 7.39% until December 31, 2031. Of the 52 arbitrations submitted, reports the ministry, 29 were awarded and 6 won. Two have been cancelled, and there are 19 awards pending.

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