No substitutions allowed: courts restrict assignment of ICSID and ECT arbitral awards

Writing for the New Law Journal, Kamran Rehman and Harriet Campbell explore the English Commercial Court’s recent decision restricting assignment of ICSID arbitral awards, and its implications for investors, funders and others involved in the enforcement of investment treaty awards.

In Operafund Eco-Invest SICAV plc and another company v Kingdom of Spain [2025] EWHC 2874 (Comm), the court considered whether an arbitral award made under the International Centre for Settlement of Investment Disputes (ICSID) Convention and the Energy Charter Treaty (ECT) could be assigned to a third party for enforcement purposes. The court concluded that it could not.

The claimants had obtained a €29.3 million ICSID award against Spain and subsequently assigned their interests in the award to a third-party entity. That entity sought to be substituted as claimant in the English enforcement proceedings, but Spain opposed the application.

The court held that both ICSID awards and awards arising from ECT claims are not capable of assignment under English law in this context. As a result, the proposed substitution was refused.

In reaching its decision, the court found that the term ‘party’ in Article 54(2) of the ICSID Convention refers only to a party to the original arbitration and does not extend to an assignee seeking to enforce the award. The court also concluded that the ECT’s subrogation provisions do not permit private assignments of awards to third parties.

The judgment departs from the approach taken in some other jurisdictions, including proceedings relating to the same award in the United States and Australia. Permission to appeal has been granted, meaning the position may evolve further.

Practical implications

For now, parties seeking to enforce ICSID or ECT awards in England should expect enforcement action to be brought in the name of the original award creditor rather than an assignee. While the decision may limit options for parties looking to transfer enforcement rights, it does not prevent commercial arrangements that provide economic benefits linked to award enforcement.

The decision is likely to be of particular interest to investors, litigation funders and those active in the secondary market for arbitral award enforcement.

For a more detailed overview of the issue, click here to read the full article in the New Law Journal. For non-subscribers, please complete the relevant fields for access.