Ratifying New York Convention alone does not waive sovereign immunity, English High Court rules

Ratification of the New York convention on its own is not a ground for a state’s submission to the jurisdiction of the English courts.

The High Court’s judgment of 17 April 2025 in the case of CC/Devas (Mauritius) Ltd. and others v. The Republic of India [2025] EWHC 964 (Comm) has attracted the attention of practitioners due to its thorough examination of the issue of sovereign immunity under the UK’s State Immunity Act 1978 (SIA) in the context of investor-state arbitration.

Background

The case concerned an investor-state arbitration between Mauritius company Devas Multimedia Private Limited (Devas) and India. In 2005, Devas entered into a contract with Antrix Corporation Limited, an Indian state-owned company, in relation to the lease of a portion of India’s S-Band spectrum on two of India’s satellites operated by the Indian Space Research Organisation (the Contract). The project’s aim was the creation of a hybrid communications platform for the provision of multimedia services across India. The S-Band is a portion of the electromagnetic spectrum that can be used to send and receive signals using small units, such as mobile phones and laptops. In 2011, however, India terminated the Contract, referring to the need to preserve the S-Band spectrum for national purposes. As a result, Devas and its shareholders brought an investor-state claim under the Mauritius-India BIT 1998. An award on jurisdiction and merits was subsequently rendered in 2016, followed by an award on quantum in 2020 (BIT Awards). The outstanding value of two awards totals in excess of EUR 195 million.

Issues

The claimants applied to the English Courts for recognition and enforcement of the BIT Awards. To that extent, they obtained a “without notice” enforcement order in respect of their application to enforce the BIT Awards under s.101 of the UK Arbitration Act 1996 (the Enforcement Order). However, India challenged the Enforcement Order on the basis that it was immune from the jurisdiction of the English Courts. The ground for that challenge was s.1 SIA, containing the general rule that foreign states are immune from the jurisdiction of the English Courts. That general rule, in India’s case, was not displaced by the exception contained in s.9 SIA, which provides that the state in question is not immune from the jurisdiction of the English Courts where it has agreed (in writing) to submit a dispute to arbitration – because India had not agreed to do so. The s.9 SIA issue is still pending and is not the subject of the April 2025 judgment.

The Court identified for preliminary resolution the question of whether India’s ratification of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention or NYC) is, on its own (and regardless of whether India agreed to arbitration or not) a submission by “prior written agreement” under s.2(2) SIA and by virtue of Article III of the NYC. In other words, the issue under consideration was India’s potential submission to the Court’s adjudicative jurisdiction, as opposed to its jurisdiction as regards enforcement – the latter not being the subject of this judgment.

Law

Article III NYC provides that “[e]ach 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”.

S.1 (General immunity from jurisdiction) SIA states that “[a] State is immune from the jurisdiction of the courts of the United Kingdom except as provided in the following provisions of this Part of this Act. . . .”. S.2 (Submission to jurisdiction) SIA states in (1) 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 in (2) that “[a] State may submit after the dispute giving rise to the proceedings has arisen or by a prior written agreement; …”.

Judgment

Sir William Blair (sitting as a Judge of the High Court) responded to the question in the negative:

“Section 2(2) of the UK’s State Immunity Act 1978 (SIA) provides that a state may submit to the jurisdiction of the UK courts by a prior written agreement. I consider that by reason only of its ratification of the New York Convention 1958 (NYC), the Republic of India has not submitted to the jurisdiction, or to put it another way, ratification of the NYC by India does not in and of itself, and absent a valid arbitration agreement, amount to consent by way of a ‘prior written agreement’ by the state waiving its immunity. This is because (1) there is no indication that it was the intention of the drafters of the NYC to preclude immunity-based arguments in enforcement actions against states, and overall the commentary is to the effect that immunity-based arguments are not precluded, (2) applying the established classification of state immunity in English and international law, the reference to ‘rules of procedure’ in Article III NYC preserves state immunity in its own terms, and (3) applying the test for waiver in English law, the ratification of Art III of the NYC is not, on its own, a waiver of state immunity by India”.

Conclusion

The issue of state immunity in investor-state arbitration has become increasingly prominent in recent years. Cases like Yukos, Spain renewables, Stati and Devas show that sovereigns use every tool in their toolbox to resist the enforcement of awards. In this environment, it is therefore paramount to utilise expertise in international law as well as in municipal law to navigate through complex disputes of this nature.

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