Brussels opens state aid investigation into Spain's payment to JGC

The European Commission has opened a formal state aid investigation into the EUR 23.51 million that Spain paid to JGC Holdings Corporation under an ICSID arbitration award on renewable energy. The decision, taken by letter of 4 August 2026, initiates the procedure laid down in Article 108(2) of the Treaty on the Functioning of the European Union and was published in the Official Journal of the European Union, C series, of 23 September 2026 as case SA.102404 (2022/NN) (C/2026/4920). Interested parties have one month from publication to submit their comments.

The award and its origin

The award was rendered on 9 November 2021 by an arbitration tribunal established under the auspices of the International Centre for Settlement of Investment Disputes (ICSID), in the proceedings JGC Holdings Corporation (formerly JGC Corporation) v. Kingdom of Spain (ICSID Case No. ARB/15/27). The tribunal found that Spain breached the fair and equitable treatment standard in Article 10(1) of the Energy Charter Treaty and ordered compensation of EUR 23.51 million, plus interest and a contribution towards the costs of the arbitration. Spain notified the award to the Commission on 25 March 2022, in accordance with Article 108(3) TFEU.

JGC is a Japanese engineering holding company incorporated on 25 October 1928. In 2010 it acquired 26 % of two special purpose vehicles, Solacor Electricidad Uno, S.A. and Solacor Electricidad Dos, S.A., which own and operate the Solacor 1 and Solacor 2 concentrated solar power plants, each of 50 MW, in Andalusia. In January 2016 JGC sold half of its stake to Atlantica Yield, leaving it with 13 % of each plant when the award was issued.

From the 2007 scheme to the 2013 reform

The plants benefited from the 2007 premium scheme, governed by Royal Decrees 661/2007 and 1578/2008 and Royal Decree-Law 6/2009, which Spain never notified to the Commission. Spain replaced it through Royal Decree-Law 9/2013, Law 24/2013, Royal Decree 413/2014 and Orders IET/1045/2014 and IET/1459/2014. The Commission approved the 2013 scheme in its decision of 10 November 2017 in case SA.40348, which already stated that compensation granted by an arbitration tribunal for the modification of the 2007 scheme constitutes state aid in itself.

The transfer to Blasket and the payment

• On 6 February 2024, Blasket Renewables Investment, a litigation fund incorporated in Delaware on 14 July 2022, was assigned the rights to the award by JGC.
• Blasket’s direct shareholders are Trinity Investments DAC (60 %) and Blasket Investments DAC (40 %), both based in Dublin.
• On 13 August 2024 Spain deposited EUR 32 954 296 with Blasket’s bailiff to end the freezing of funds held by Eurocontrol.
• On 4 June 2025 that sum was released to Blasket to avoid forced execution against Spanish assets in the United States.

Brussels’ objections

The Commission considers at this stage that the award, and in any event its implementation, payment or execution, meets the cumulative criteria for the existence of state aid and is unlawful, having been granted on 9 November 2021 and paid before approval. It expresses doubts on two independent grounds:

• a possible breach of EU law, including Article 19(1) TEU, Articles 267 and 344 TFEU, the autonomy of the EU legal order and discrimination contrary to Article 18 TFEU;
• non-compliance with the guidelines on state aid for environmental protection and energy 2014-2020, notably as regards the incentive effect, necessity and proportionality of the measure.

Spain must not pay, implement or execute the award and must prevent JGC, Blasket and any third party from seeking its recognition or enforcement, whether in the Union or in third countries. Under Article 16 of Council Regulation (EU) 2015/1589, unlawful aid may be recovered from the recipients.

Why it matters

The case puts the Spanish treasury and foreign investors on notice that arbitration awards compensating regulatory changes in renewables support can be clawed back as illegal state aid, and it extends the standstill obligation to national courts, which are asked not to recognise or execute the award. It also confirms that the Commission will pursue the beneficiaries of such awards even after the rights have been sold on to litigation funds.

Source: Official Journal of the European Union, C series, C/2026/4920, 23 September 2026, State aid – Spain (official reference: C/2026/4920).