English High Court holds ratification of New York Convention not enough to waive sovereign immunity

30 April 2025

In a recent decision, the English High Court held that Art III of the New York Convention 1958, which provides that States "shall […] enforce" arbitral awards, was not enough to waive India's sovereign immunity to jurisdiction of the English courts.

Background

A worldwide enforcement saga remains ongoing between certain shareholders in Devas Multimedia Private Limited (Devas Claimants) and India, which arises out of steps India took to bring about the termination of an underlying satellite communications contract. Those steps culminated in a commercial arbitration award for USD562.5 million rendered in 2015 and, more relevantly, a pair of investor-State awards for USD194 million rendered against India in 2016 and 2020.

This is yet another decision in that saga and looks to be one step forward, two steps back for the Devas Claimants. In determining a preliminary question on a point of law, the High Court ruled that India's ratification of the New York Convention did not constitute a waiver of sovereign immunity.

The question for decision

The decision arises in the context of ongoing proceedings to enforce the Devas investor-State awards in the UK. As part of those proceedings, a preliminary question of law was raised for determination, being whether India had submitted to the adjudicative jurisdiction of the English courts under section (2) of the UK State Immunity Act 1978 by way of India's ratification of the New York Convention.

In effect, the Court left open the question of whether the awards should be enforced. The preliminary question was essentially raised by the Devas Claimants to "bypass any further consideration of sovereign immunity" in the enforcement proceedings. Implicit in this is that there are other grounds open to the Devas Claimants to argue that India waived sovereign immunity from enforcement of the awards (which will no doubt be raised as part of the remaining phase of the proceedings).

Decision

Sir William Blair gave the Court's decision. In rendering his decision, Sir William started by considering the terms of Article III of the New York Convention, which provides that the UK "shall recognise arbitral awards as binding and enforce them in accordance with the rules of procedure" of the UK.

The reference to "rules of procedure" ultimately had a significant impact on the decision. Having characterised sovereign immunity as a matter of procedural law under English law, Sir William held that Article III preserved the existing position with respect to a waiver of sovereign immunity. In other words, the ratification of the New York Convention (i.e., Article III) did not constitute a waiver.

In rendering his decision, Sir William drew on international commentary that, in his view, provided "substantial support to India's case". Specifically, he noted that the commentary "does not suggest that state immunity if waived by ratification of Article III" of the New York Convention.

Sir William also drew extensive guidance from the Federal Court of Australia's (FCA) recent decision in Republic of India v CCDM Holdings, LLC [2025] FCAFC 2. In that case, the FCA held that India had not waived sovereign immunity from enforcement of the Devas awards. However, the decision is not yet final. As Sir William recognised, that decision is currently the subject of a special leave application (to appeal the decision) before the High Court of Australia. If that application is successful, it will be up to the High Court to authoritatively decide the issue under Australian law.

In the Australian case, the FCA decided the issue largely based on India's commercial reservation (under which it would only enforce awards of a "commercial" nature). The FCA had decided that investor-State awards were not "commercial". Despite it being an issue raised by India in the English proceedings, Sir William did not finally decide on that particular issue.

Ultimately, Sir William decided that India had not waived sovereign immunity for three reasons. In his view:

there was no indication that the drafters of the New York Contention intended to preclude States from asserting immunity defences in enforcement actions;
the reference in Article III to "rules of procedure" operates to preserve sovereign immunity; and
the text of Article III otherwise does not satisfy the test for waiver in English law.

Interestingly, in his decision, Sir William noted on three separate occasions that his conclusion was not "in any way intended to contradict the enforcement friendly aspect of the" New York Convention.

Implications

The decision ultimately confirms that, without more, a State's ratification of the New York Convention will not be sufficient to constitute a waiver of sovereign immunity to the jurisdiction of the English courts.

The decision adds to an increasingly disharmonious body of international rulings on India's sovereign immunity in the enforcement of the Devas awards. It comes not three months after the decision of the FCA in Republic of India v CCDM Holdings, LLC. However, earlier decisions in Singapore, the Netherlands and Canada (all of which were noted by Sir William) all rejected India's claims of sovereign immunity in respect of the Devas awards.

It also comes not long after the English Court of Appeal's decision in General Dynamics United Kingdom v the State of Libya. Our earlier blog on that judgment also commented tangentially on the FCA's decision.

As we noted, the Court of Appeal in the General Dynamics case found that Libya had waived sovereign immunity, not least because it had agreed to the application of the 1998 ICC Rules which contained a requirement on Libya to carry out any awards "without delay" (Article 28(6)). The underlying arbitration rules applicable to Devas' investor-State awards are the 1976 UNCITRAL Rules, which likewise contain the same obligation to carry out any awards without delay. The English courts may ultimately find that India waived sovereign immunity from enforcement of the awards based on this agreement or for similar reasons.

This decision underscores the critical importance of seeking out good legal advice when dealing with sovereigns (whether in an investor-State or a commercial context). It is especially important to ensure that appropriate sovereign immunity waivers exist in any contracts or in underlying arbitration agreements and procedural rules that have been incorporated by reference. Moreover, careful enforcement strategies are essential in order to identify and target stable and predictable jurisdictions in which to seek execution against any sovereign assets.