ICSID Tribunal Divides Berkeley v Spain Energy Arbitration into Two Phases
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TL;DR
- ICSID tribunal splits arbitration between Berkeley Energia and Spain into two phases.
- First phase will address jurisdictional objections, including denial of benefits.
- Second phase will examine the merits and quantum of the claim.
- Berkeley claims compensation of around USD 1.25 billion over the Salamanca mining project.
Overview
The ICSID tribunal overseeing the investment arbitration initiated by Berkeley Energia Limited against Spain has decided to divide the proceedings into two distinct phases. The arbitration concerns alleged violations related to Berkeley's investment in the Salamanca mining project and involves a compensation claim of approximately USD 1.25 billion under the Energy Charter Treaty.
What Happened
Berkeley Energia, through its subsidiary Berkeley Exploration Limited, commenced arbitration at ICSID in May 2024 over its investments in the Salamanca mining project in Spain.
The tribunal has ordered the proceedings to be split. The first phase will address Spain's jurisdictional objections, including arguments on the denial of benefits.
If jurisdiction is confirmed, the arbitration will then move to a second phase focusing on the substantive merits of the case and the assessment of damages.
Berkeley filed its memorial in February 2026, asserting that Spain's measures against its subsidiary violated the Energy Charter Treaty, and is seeking approximately USD 1.25 billion in damages.
The company has informed Spanish market authorities (CNMV) and indicated that it remains open to engaging with Spanish authorities for a potential amicable settlement relating to the project's permits.
Context
Berkeley's Salamanca project has faced regulatory and administrative challenges that led to the current dispute.
The arbitration is being conducted under the Energy Charter Treaty at ICSID, a major forum for resolving cross-border investor-state disputes.
Dividing proceedings into phases is a common approach in investment arbitration when jurisdictional issues could fully dispose of the claim.
Why It Matters
- The bifurcation of the procedure allows jurisdictional challenges to be resolved before potentially lengthy and costly consideration of the merits.
- The outcome may impact future investment arbitration strategies and Spain's liability under the Energy Charter Treaty.
- A large compensation claim highlights ongoing tensions between regulatory policy and investor protections in the European energy sector.