English High Court Clarifies Sovereign Immunity: Ratification of New York Convention Not a Waiver

English High Court determines that ratification of the New York Convention on the Recognition and Enforcement of Arbitral Awards does not constitute prior written agreement to waive sovereign immunity.

We recently wrote in Dispute Resolution Journal regarding the Court of Appeal (“CoA”)’s decision in Border Timbers Ltd. & anor v. Republic of Zimbabwe and Infrastructure Services Luxembourg S.á r.l.; Energia Termosolar B.V. v. The Kingdom of Spain (“ISL”) (English Court of Appeal Confirms: Sovereign Immunity Is No Shield to ICSID Registration) that Article 54 of the ICSID Convention constitutes an express waiver of sovereign immunity for the purposes of Section 2 of the State Immunity Act 1978 (“SIA”).

In CC/Devas et al. v. The Republic of India [2025] EWHC 964 (Comm), the High Court has now considered whether a State’s ratification of the New York Convention on the Recognition and Enforcement of Arbitral Awards (the “NY Convention”) also constitutes a waiver of immunity when an award is enforced against a State under the NY Convention (as opposed to under the ICSID Convention, as was the case in ISL and Border Timbers). Ultimately, the Court held that ratification of the NY Convention does not amount to a waiver of sovereign immunity by prior written agreement (Section 2(2) SIA) and is not equivalent to Article 54 of the ICSID Convention.

The dispute relates to investments made in the Indian telecommunications market in 2005, whereby the Claimants entered into agreements with Indian State companies for access to spectrum provided by satellites. In 2011, India terminated those agreements and annulled the contracts, citing the need to preserve spectrum for national purposes (rather than lease it for commercial exploitation). The Claimants subsequently obtained an ICC award against relevant counterparties, but struggled to enforce that award following annulment in the Indian Courts. The Claimants also sought to enforce their rights pursuant to the Mauritius-India BIT in a UNCITRAL Arbitration administered by the Permanent Court of Arbitration, seated in the Netherlands (as opposed to ICSID Arbitration). That claim resulted in a EUR 195 million award in favour of the Claimants, which they are now seeking to enforce in various courts, including in England.

It is worth noting that there are two primary avenues for the waiver of immunity from the jurisdiction of the English courts under the SIA: (i) by prior written agreement (Section 2(2) SIA) or (ii) by agreement to arbitrate (Section 9 SIA). While the Mauritius-India BIT contains a written agreement to arbitrate, India denied that the Tribunal has jurisdiction due to the nature of the claims, and therefore argued that there was no valid agreement to arbitrate and, accordingly, no waiver of sovereign immunity under Section 9 of SIA. The Claimants sought to sidestep India’s jurisdictional objections by asserting that there was a waiver of sovereign immunity by India’s ratification of the NY Convention for the purposes of Section 2 of SIA.

The Court carefully considered the Claimants’ arguments and concluded that Article III of the NY Convention does not constitute prior written agreement to waive sovereign immunity for the purposes of Section 2 of SIA because:

• The wording of Article III of the NY Convention was sufficiently different to Article 54 of the ICSID Convention, and therefore no analogy to the aforementioned CoA judgment could be relied upon. Sovereign immunity is a core principle of the international legal order, and the language of Article III is silent as to sovereign immunity.
• The drafting notes of the NY Convention do not mention any intention that States which ratify the NY Convention would have waived their rights to immunity.
• Article III states that “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”. Sovereign immunity is a procedural right, rather than a substantive one, and therefore enforcement must accord with this procedural right. This does not affect the substantive entitlement to relief.
• Any waiver of immunity must be clear and unequivocal—Article III of the NY Convention does not meet this standard.

It is helpful that the Court has conclusively determined this issue which was also raised in the Border Timbers and ISL litigation before the CoA (but not determined there as not directly in issue). In this case, the prejudice to the Claimants is expected to be limited as they will ultimately succeed on their argument that there has been a waiver under Section 9 of SIA per the agreement to UNCITRAL Arbitration in the Mauritius-India BIT.

The case acts as a further reminder of the importance of seeking specialist advice when entering into commercial agreements with States or State-owned entities, including when taking into account the need to waive immunity from jurisdiction and enforcement.

Morrison Foerster’s attorneys have extensive experience advising on appropriate arbitration and forum selection clauses and navigating the investment treaty landscape, including assessing possible claims under such treaties. Please do not hesitate to contact us should you have any questions or concerns in relation to such matters.