Key takeaways
Signing a treaty doesn’t mean accepting court cases
States must clearly agree to be judged in foreign courts
Court confirms need for express consent
General treaty terms don’t override legal protections
Commercial deals need clear contracts
Waiver of immunity should be negotiated directly
CC/Devas (Mauritius) Ltd & others -v- The Republic of India [2025] EWHC 964 (Comm)
The English Court has made it clear that mere ratification by a state of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention or NYC) cannot, of itself, amount to a submission by that state to the adjudicative jurisdiction of the English courts.
The issue arose in the context of an application by the Republic of India to set aside orders made by the English Court for enforcement of bilateral investment treaty (BIT) awards against India.
The background facts
In 2005, a joint venture vehicle, Devas Multimedia Private Ltd (Devas), entered into a commercial contract with Antrix Corporation Ltd (Antrix) for the lease of a proportion of India’s electromagnetic spectrum (S Band spectrum) on two Indian satellites to be operated by the Indian Space Research Organisation. The mutual intention was to create a hybrid communications platform providing multimedia services across India. An advantage of the S Band spectrum was that it could be used to send and receive signals on small devices e.g. mobile phones and laptops without requiring their antennas to be pointed at the satellites.
Both parties to the Devas contract were Indian registered companies. Antrix was wholly owned by the Indian Government and was organised under the Department of Space. The contract provided for ICC or UNCITRAL arbitration, seated in New Delhi.
In 2011, India decided to terminate the Devas project and annul the contract because it wanted to preserve the electromagnetic spectrum for national, rather than commercial, purposes. The annulment decision was taken by various Indian politicians and governmental departments and committees. Consequently, Antrix terminated the Devas contract.
Devas commenced ICC arbitration against Antrix and obtained an award for over US$52 million for wrongful repudiation of the contract by Antrix. The award was subsequently set aside by the Delhi High Court but was recognised and enforced by the Hague Court of Appeal on grounds of absence of due process in the Indian proceedings.
In 2012, separate UNCITRAL arbitration proceedings were brought by three Mauritian entities and shareholders in Devas, as investors under a bilateral investment treaty between Mauritius and India (Mauritius-India BIT). The seat of this further arbitration (the BIT Arbitration) was the Hague, and the Permanent Court of Arbitration (PCA) was designated to administer the arbitration. The tribunal issued awards against India in the BIT Arbitration for amounts in excess of Euros 195 million.
The BIT Arbitration awards, and the prior ICC award, resulted in numerous proceedings in multiple jurisdictions on behalf of the investors to enforce the awards and, on behalf of India, to prevent enforcement. In English court proceedings, the investors had obtained a without notice enforcement order to enforce the BIT awards under s.101 Arbitration Act 1996 (the Act), which allows New York Convention (NYC) awards to be enforced in the same manner as a court judgment.
India applied to set aside the enforcement award on the grounds that:
it had immunity from the UK courts under s.1 State Immunity Act 1978 (SIA);
it had not waived immunity and submitted to the Court’s jurisdiction by a prior written agreement (s.2.2 SIA); and
s.9 SIA, which provides that a state that has agreed to submit its disputes to arbitration is not immune from the jurisdiction of the courts, did not apply because India had not agreed to submit its disputes to arbitration.
The investors relied among other things on s.17 SIA. This provides that references in s.2.2 to a prior written agreement include references to a treaty, convention or other international agreement.
The key question for the Court was whether, for the purposes of enforcing the BIT awards, the fact that India had ratified the NYC amounted to “prior written agreement” under s.2.2 SIA, such that it had submitted to the adjudicative jurisdiction of the English Court. Further, whether such ratification amounted, under Article III of the NYC, to consent to the English Court recognising and enforcing the BIT awards.
Article III NYC
This provides as follows:
"Each Contracting State shall recognize arbitral awards as binding and enforce them in accordance with the rules of procedure of the territory where the award is relied upon, under the conditions laid down in the following articles.”
The Commercial Court decision
The Court highlighted that it was only dealing with adjudicative (as opposed to enforcement) jurisdiction.
On the authorities, where state immunity was waived by treaty or convention, this had to be express and expressed in a clear and recognisable manner, as by an unequivocal agreement.
Article III of the NYC preserved state immunity by its own terms, because the obligation on a “Contracting State” was expressed to be “in accordance with the rules of procedure of the territory where the award is relied upon.” It was established in English law that state immunity was a procedural rule going to the jurisdiction of a national court. It did not go to substantive law.
The Court concluded that the ratification of Article III of the NYC was not, on its own, a waiver of state immunity by India.
Considering the broader commercial context, there were numerous commercial and financial transactions involving states and state-owned enterprises where waiver of state immunity was a matter of contract, not treaty. The extent of the waivers, whether comprehensive including as to enforcement, or limited in some way, was a matter of negotiation and relative bargaining power.
The English Court did not apply a restrictive interpretation to contractual immunity waiver clauses and express waivers were a commercial commonplace. Consequently, given that the market could restrict state immunity where this was required, there was no reason why ratification of the NYC alone should be treated as a waiver of adjudicative immunity.
The balance between investors and states in investment disputes was a delicate and controversial one and the Court should give sufficient weight to the fact that state immunity occupied an important place in international law. This was not in any way to contradict the enforcement friendly aspect of the NYC.
Additionally, the Court noted that India disputed the arbitration agreement, and there were ongoing proceedings in the Hague which was the seat of the BIT Arbitration. In principle, however, where there was an issue as to the effect or validity of the arbitration agreement, determination of the issue for state immunity purposes should be determinative for NYC purposes as well as avoiding duplication.
Comment
This is a useful decision adding to the jurisprudence on the scope and extent of state immunity and when a state will be taken to have waived such immunity.
