EU Commission tells Spain not to pay up in long-running renewable subsidies case
Foreign investors, mostly investment funds, took legal action against Spain after the previous conservative government cut renewables subsidies in 2013 to reduce a power tariff deficit built up through years of artificially low prices.
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In 2018, French infrastructure-focused private equity firm Antin (ANTIN.PA), opens new tab won an arbitration procedure against Spain for losses allegedly suffered as a consequence of the policy change, and Spain was ordered to pay 101 million euros ($109.39 million) in compensation.
The case was brought under the Energy Charter Treaty, an international treaty that allows energy companies to sue governments over policies that damage their investments.
Later Antin, like other companies and investment funds that had invested in Spain in expectation of subsidies and also lodged lawsuits, sold the compensation rights to another fund, the Spanish Energy Ministry said without mentioning the fund.
The EU Commission, after a long-running investigation, said on Monday that paying the arbitration would breach EU state aid rules, which prevent governments from giving unfair advantages to one firm over competitors.
The ruling instructs Spain not to pay any compensation based on the arbitration award and to ensure that the award cannot be claimed in any other way.
The finding is a boon for Spain, which has one of Europe's most ambitious green agendas.
Spain's energy ministry welcomed the ruling and said it hopes it will help it defeat similar claims.
International investors filed a total of 51 arbitrations over the cancellation of Spanish renewables subsidies worth 10.6 billion euros, according to the ministry. Eight are still pending.
So far, Spain has been ordered to pay around 1.5 billion euros in various cases, the ministry added. Some funds have tried to have arbitration awards enforced with lawsuits outside EU in countries such as United States, Australia or Britain.
Two years ago, a London court ruled that investors could seize Spanish assets to enforce a 120 million-euro judgment in a related case.
($1 = 0.9233 euros)
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