Energy Company Moved to Recognize ICSID Award Against Bulgaria

ACF Renewable Energy Limited ("ACF") moved before the U.S. District Court for the District of Columbia today to recognize and enforce a 60 million euro arbitration award against the Republic of Bulgaria.

ACF's petition to confirm states that the award arose out of Bulgaria's violations of the Energy Charter Treaty (the "ECT") with respect to ACF's investment in a photovoltaic facility. According to ACF, mere weeks after it bought a Bulgarian project company owning a photovoltaic facility, the sovereign introduced a series of measures that upended a governmental incentive scheme for photovoltaic plants that guaranteed renewable energy producers a fixed feed-in tariff, including by imposing a new "grid access fee" on producers of renewable energy, imposing an annual cap on the quantity of electricity produced by renewable energy plants that would qualify for the feed-in tariff, imposing an electricity production fee on wind and solar energy producers, and finally by replacing the feed-in tariff scheme altogether with a feed-in premium scheme. These measures, ACF argues, greatly diminished the value and return on ACF's investment in the Bulgarian project company and photovoltaic facility. ACF's damages surpassed 70 million euro.

ACF commenced arbitration in February 2018. Bulgaria objected to the Tribunal's jurisdiction, including on the ground that the ECT and the ICSID Convention would not provide jurisdiction over disputes between nationals of a EU state and another EU state. The Tribunal rejected all of Bulgaria's objections and upheld the Tribunal's jurisdiction, except that the Tribunal decided that one of the measures constituted a taxation measure and was thus outside of the Tribunal's jurisdiction. The Tribunal ordered Bulgaria to pay compensation to ACF, including over 60 million euro, pre-award interest, post-award interest, and legal costs and fees.

Bulgaria refused to pay the award. ACF filed the complaint seeking recognition and enforcement of the award under 22 U.S.C. § 1650a. Thomas C.C. Childs and Camilla Akbari of King & Spalding LLP represent ACF Renewable Energy Limited. White & Case represented Bulgaria in the arbitration, but no information regarding counsel in the recognition proceeding is available currently for the sovereign.

The case is ACF Renewable Energy Limited v. The Republic of Bulgaria, No. 1:24-cv-01715 (D.D.C.).