Sovereign immunity and ICSID award enforcement in the UK and Singapore

October 2026  |  SPOTLIGHT | LITIGATION & DISPUTE RESOLUTION

Financier Worldwide Magazine

October 2026 Issue

Until recently, the question of whether states may rely on sovereign immunity to resist the recognition and enforcement of awards rendered under the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention) had been a source of uncertainty in the field of investor-state arbitration.

In 2026, two significant decisions – from the UK Supreme Court and the Singapore High Court – have brought welcome clarity on this issue, indicating that courts (at least in major arbitration jurisdictions) will be sceptical of attempts by states to avoid unfavourable awards by invoking sovereign immunity.

This article examines these decisions and their implications for the enforcement of ICSID awards against sovereign states.

UK courts

Sections 2(1) and 2(2) of the State Immunity Act 1978 (UK SIA) respectively provide that “[a] State is not immune as respects proceedings in respect of which it has submitted to the jurisdiction of the courts of the United Kingdom” and “[a] State may submit after the dispute giving rise to the proceedings has arisen or by a prior written agreement.”

In March 2026, the UK Supreme Court clarified the application of these provisions with respect to ICSID Convention awards, handing down its judgment in two linked appeals concerning ICSID awards issued against Spain and Zimbabwe respectively: Spain v Infrastructure Services Luxembourg and Zimbabwe v. Border Timbers Ltd.

Both award creditors obtained registration of their awards in the English High Court under the Arbitration (International Investment Disputes) Act 1966. Spain and Zimbabwe each applied to set aside registration, invoking sovereign immunity under section 1(1) of the UK SIA.

The first instance judges reached opposing conclusions: Justice Fraser held that article 54(1) of the ICSID Convention qualifies as a submission to the jurisdiction of the English courts under section 2(2) of the UK SIA and thus a waiver of sovereign immunity, while Justice Dias held that it does not. On appeal, the English Court of Appeal agreed with the view of Justice Fraser. Spain and Zimbabwe both appealed to the Supreme Court.

In a unanimous judgment, the Supreme Court held that upon a state’s ratification of the ICSID Convention, article 54(1) of the ICSID Convention constitutes a “prior written agreement” by that state submitting to the jurisdiction of the UK courts within the meaning of section 2(2) of the UK SIA, which thereby waives immunity with respect to the recognition and enforcement of ICSID awards.

The Supreme Court held that a waiver of sovereign immunity requires “a clear and unequivocal expression of the state’s consent to the exercise of jurisdiction”, which may be “conveyed not only by the express words used but also by what is necessarily inherent in those words, and by what necessarily follows as a consequence of the use of those words”.

Prior to this decision, the most-cited authority regarding the waiver of sovereign immunity was Lord Goff’s widely-cited speech in Pinochet (No. 3), which indicated that express waiver of sovereign immunity could only be established by words that unambiguously and specifically mentioned immunity. The Supreme Court criticised that test as presenting “an unnecessarily narrow view of what may constitute an express waiver of immunity” and preferred a test of “whether the words used necessarily lead to the conclusion that the state has submitted to the jurisdiction”.

Examining the ICSID Convention’s architecture more broadly, the court also noted that article 54(1) creates a mutual and reciprocal obligation that is fundamentally inconsistent with maintaining adjudicative immunity at the recognition and enforcement stage. The court further held that articles 53 to 55 create a system that draws a sharp distinction between “recognition and enforcement” under article 54 and “execution” under article 54(3) and article 55, with the latter expressly preserving only immunity from execution, thereby displacing adjudicative immunity by necessary negative implication.

Notably, the court declined to rule on whether ICSID award enforcement engages the “arbitration exception” under section 9(1) of the SIA, which provides that “where a State has agreed in writing to submit a dispute which has arisen, or may arise, to arbitration, the State is not immune as respects proceedings in the courts of the United Kingdom which relate to the arbitration”.

Singapore courts

Nine days before the UK Supreme Court’s judgment, Justice Andre Maniam of the Singapore High Court delivered judgment in NextEra Energy Global Holdings BV v Kingdom of Spain. The applicants, Dutch investors, sought to register an ICSID award in Singapore under the Arbitration (International Investment Disputes) Act 1968. Spain resisted on grounds of sovereign immunity under section 3 of Singapore’s State Immunity Act 1979 (Singapore SIA).

The court held that both the ‘submission exception’ under section 4 and the ‘arbitrations exception’ under section 11 of the Singapore SIA (which are respectively identical to sections 2 and 9 of the UK SIA) applied. Section 4 applied because Spain had submitted to the jurisdiction of the Singapore courts by acceding to the ICSID Convention, and in particular article 54(1) of the Convention. In any event, section 11 applied because Spain had agreed in writing to submit the dispute to arbitration through the Energy Charter Treaty.

In reaching these conclusions, the court applied the 2023 decision of the Singapore Court of Appeal in Deutsche Telekom AG v Republic of India, which described ICSID awards as a “special category” existing “within a self-contained system that is not subject to review by national courts”.

The Deutsche Telekom decision is also notable for two other findings by the Singapore Court of Appeal. First, the court established the doctrine of transnational issue estoppel, finding that it precluded India from rearguing issues already determined by the Swiss Federal Supreme Court in prior setting-aside proceedings. Second, the court also recognised the ‘primacy principle’, whereby enforcement courts should accord primacy to seat court decisions.

The Singapore International Commercial Court subsequently applied both transnational issue estoppel and the primary principle in Hulley Enterprises Ltd v The Russian Federation, finding that Russia was estopped from relitigating jurisdictional issues resolved by Dutch appellate courts, resulting in the enforcement of awards valued at over $63bn.

Key implications for investor-state arbitration practitioners

These developments carry several important practical implications for investor-state dispute settlement (ISDS) practitioners.

Enforcement confidence for ICSID award creditors. ICSID award creditors may now proceed to enforcement in both England and Singapore with confidence that sovereign immunity cannot be invoked at the recognition and enforcement stage. The convergence of legal positions in these two major arbitration-friendly jurisdictions significantly enhances the practical enforceability of ICSID awards.

Execution immunity remains the critical battleground. While adjudicative immunity has now been conclusively addressed, immunity of sovereign assets from execution – expressly preserved by article 55 of the ICSID Convention and by sections 13 to 14 of the UK SIA and section 15 of the Singapore SIA – remains the principal obstacle to practical recovery.

To seize or attach sovereign assets to satisfy the award debt, claimants will need to demonstrate that the specific assets are “for the time being in use or intended for use for commercial purposes” – a narrow exception that excludes (among other assets) central bank reserves, diplomatic property and military assets.

Express waiver clauses in commercial contracts. The privileged treatment accorded to ICSID creditors contrasts with the treatment of awards subject to the New York Convention. In CC/Devas (Mauritius) Ltd v Republic of India, the English Court of Appeal held that a state’s ratification of the New York Convention does not of itself constitute a waiver of sovereign immunity.

While Singapore courts have not directly confronted this issue, there remains significant uncertainty, and therefore a claimant will need to either establish that the ‘arbitration exception’ applies or relies on an express waiver. In practical terms, express waiver clauses remain essential in agreements with sovereign counterparties if the contemplated award will be subject to the New York Convention.

Strategic forum selection. Singapore’s doctrine of transnational issue estoppel and the ‘primacy principle’, which have no direct parallel under English law, offer award creditors a powerful additional tool by significantly constraining a state’s ability to relitigate issues across multiple enforcement fora. Where a seat court has already ruled on jurisdictional or immunity objections, Singapore courts will preclude the respondent state from relitigating those issues – a consideration that should inform enforcement strategy from the outset.

Conclusion

The question of adjudicative immunity at the recognition and enforcement stage has been decisively resolved in favour of ICSID award creditors in two of the world’s leading arbitration seats.

ISDS practitioners may now approach enforcement with considerably greater certainty, while remaining alert to the continued challenges posed by execution immunity and the practical difficulties of asset recovery against sovereign states.

Jonathan Lim is a partner and Joel Ng is an associate at King & Spalding (Singapore) LLP. Mr Lim can be contacted on +44 (0)20 7551 7533 or by email: jlimwz@kslaw.com. Mr Ng can be contacted on +65 6303 6073 or by email: joelng@kslaw.com.

© Financier Worldwide

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Jonathan Lim and Joel Ng

King & Spalding (Singapore) LLP