On 5 March 2026, we wrote about the UK Supreme Court's judgment (following appeals by Spain and Zimbabwe) confirming that Contracting States to the ICSID Convention cannot invoke sovereign immunity to prevent the registration of ICSID awards in England and Wales for the purpose of enforcement. The Supreme Court held that Article 54(1) of the ICSID Convention constitutes a prior written submission to jurisdiction for the purposes of section 2(2) of the State Immunity Act 1978. That matters because the ICSID system is intended to be “closed” at the recognition stage: once the formal requirements for registration under the Arbitration (International Investment Disputes) Act 1966 are met, an ICSID award is treated as judgment-equivalent for execution, without merits review of the award by the English courts.
However, this was not the only judgment of the English courts during that week which highlighted England and Wales, and in particular London, as a pro-enforcement forum. On 2 March 2026, the Commercial Court (“Court”) handed down its judgment in Hulley Enterprises Ltd & Ors v. The Russian Federation [2026] EWHC 456 (Comm) (“Judgment”). The Judgment, in respect of which permission to appeal has been granted, forms part of the long-running enforcement proceedings connected to the Yukos arbitrations (“Arbitrations”). The Court granted recognition and enforcement of the Final Awards in the Arbitrations (“Awards”) in respect of damages (and interest thereon), but – on the assumed facts for a trial of preliminary issues – the Court declined to enforce the Awards' costs and interest-on-costs components.
The Judgment therefore provides a useful case study of the (narrow) judicial gatekeeping that remains available under the New York Convention regime in England and Wales, as compared to the regime for the enforcement of ICSID awards.
Background
The Arbitrations concerned claims by the former majority shareholders of Yukos Oil Company that Russia unlawfully expropriated their investments through politically-motivated tax measures, bankruptcy proceedings and a rigged asset sale, in breach of its international legal obligations under the Energy Charter Treaty. The Awards granted the Claimants damages exceeding USD 50 billion, plus interest and costs. They have generated extensive set-aside and enforcement litigation in particular before the Dutch and English courts. Since Russia is not a Contracting State to the ICSID Convention, the Arbitrations proceeded under the UNCITRAL Rules, seated in The Hague. Thus, recognition and enforcement in England and Wales fell to be determined under the New York Convention as implemented by sections 101-103 of the Arbitration Act 1996 (“Act”). Sections 101-103 of the Act were not amended by the Arbitration Act 2025.
Section 101 of the Act states that a New York Convention award may, by leave of the court, be enforced in the same manner as a judgment or order of the court to the same effect.
Russia resisted enforcement principally under section 103(3) of the Act. This states that recognition or enforcement of a New York Convention award shall not be refused except in limited cases, including if it would be contrary to public policy to recognise or enforce the award. Russia argued that enforcement would offend public policy because of alleged historical illegality connected with the acquisition and operation of Yukos Oil Company and alleged procedural misconduct in the Arbitrations.
The Court's decision
The Court affirmed that the “New York Convention and the implementing provisions in ss. 101 to 103 of the [Act] are inherently pro-enforcement.” Since it was a preliminary issues trial, the Court proceeded on the basis of an assumption that Russia's factual allegations were correct. Based on that assumption, the Court considered that the alleged procedural misconduct could not have affected the liability or quantum reasoning underpinning the Awards. However, the Court was prepared to accept that such alleged misconduct could have affected the tribunal's decision on costs, and therefore declined (at this stage) to enforce the costs and interest-on-costs components of the Awards. The Court nevertheless enforced the damages and interest on damages awarded.
The Judgment illustrates the difference between the recognition of New York Convention awards and the registration of ICSID awards before the English courts. The proceedings necessarily involved a judicial inquiry into whether the pleaded grounds for refusing enforcement were engaged, including analysis of (i) the extent to which the English court proceeds on the basis of tribunal findings; (ii) when arguments may be barred because they could and should have been raised earlier; and (iii) whether the alleged procedural misconduct was material to the outcome.
Our earlier article explained that the treatment of ICSID awards is different. Registration of an ICSID award is a streamlined, formal process. Once registered, the award is treated as having judgment-equivalent effect for execution in domestic procedure. The English court is not asked at the registration stage to adjudicate New York Convention-style “refusal grounds,” such as whether enforcement would offend public policy. While the New York Convention regime is designed to facilitate enforcement, it still allows respondents to test the limited statutory grounds on which recognition or enforcement may be refused, especially when those defences are framed as public policy or procedural misconduct.
Why does this matter, and how can we help?
Certain investment treaties give investors an option to select ICSID arbitration or non-ICSID arbitration. Such decisions may be pre-determined by other factors, including where the respondent State is not a Contracting State to the ICSID Convention. However, where an investor has a selection option available, the two recent judgments of the English courts illustrate how the enforcement pathway can affect timelines, litigation risk and the likely points of resistance.
ICSID awards may offer a more streamlined recognition in England and Wales. Enforcement of a non-ICSID, i.e. a New York Convention, award requires the court to consider (within strict limits) whether any statutory ground for refusing recognition or enforcement is made out. As the Judgment illustrates, this can lead to outcomes such as partial enforcement.
In both regimes, execution strategy remains critical.
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