Under US law, a foreign state’s sovereign immunity is restricted: One of the important exceptions in the Foreign Sovereign Immunities Act (“FSIA”) is the state’s consent to private arbitration. On August 16, 2024, in NextEra Energy v. Spain, the Court of Appeals for the DC Circuit found that, by consenting to arbitrate disputes brought under the Energy Charter Treaty (a multilateral treaty protecting investments made in the energy sector), Spain had waived its sovereign immunity from suit.
In this Client Insight, Milbank partner Viren Mascarenhas and special counsel Kamel Aitelaj discuss the DC Circuit ruling and its potential implications for future enforcement actions in the District of Columbia.
