The fluctuating prices of fossil fuels and the environmental concerns about the consumption of energy are prompting a massive shift in the energy production, where renewable energy sources (“renewables” or “RES”) are beginning to build an influential market share, while playing a significant role in improving energy security in many countries.
This shift especially includes the wind energy, the global cumulative capacity of which, according to the Global Wind Energy Council, reached a total of 486.7 GW in 2016, and, according to the Global Wind Report: Annual Market Update 2016,is expected to grow to 800 GW by the end of 2021, thereby strengthening its position of a mainstream source of energy.
Over the past decade this trend was evident also in Poland, where – due to a number of governmental initiatives on the development of RES starting from 2004 – we have witnessed stable growth of the wind energy sector. 1,2 GW of wind power added to the country’s electricity grid in 2016 only confirmed this clear upward tendency, making Poland the 7th largest wind market in European Union with over 5,8 GW of production capacity.
Despite the increase of average production in 2016, the wind energy sector in Poland slowed down in the second half of 2016, when new wind investments started to disappear, and then was at the standstill for the whole 2017 with only 40 MW of wind energy installed (compared to total of over 1,9 GW installed in 2015 and 2016).
This correlated with the introduction of the Investments in Wind Power Plants Act of 20 May 2016 (“Wind Energy Investments Act”, also called “distance act” or “anti-wind power act”), which blocked the possibility to build new power plants (including wind projects under development) and increased the burden of taxes payable by the owners of the existing power plants. The situation of wind energy investors and producers additionally became even worse due to the amendments to the Renewable Energy Sources Act of 20 February 2015 (“RES Act”), which reduced the probability and value of vast majority of the wind energy investments.
The regulatory changes, in turn, have led many foreign investors to consider claiming compensation for damage suffered as a result of these changes and for that purpose starting arbitration under bilateral and multilateral investment treaties signed by Poland.
Being a Member State of the European Union (“EU”) since 2004, Poland is obliged to follow the rules set forth by the regulations, directives and other EU legal acts. This includes the Renewable Energy Directive (Directive 2001/77/EC, superseded by Directive 2009/28/EC) which creates an overall policy for the production and promotion of energy from renewable sources in the EU.
It requires the UE to increase the share of RES in total energy consumption and the transportation sector by 2020 – to be achieved through the achievement of individual national targets. In case of Poland, this target means the increase of the proportion of energy from RES up to at least 15%.
To achieve this target and encourage investments in renewable energy sector, while having in mind the significant upfront expenses required for this type of investments and thus a strong interest of the investors in the stability of their regulatory regime, Poland started deploying different RES support mechanisms, including: priority access to transmission grid, exemption from excise tax, reduction of the grid connection fee for smaller installations (< 5 MW) and co-funding.
Apart from that, in 2004 the Energy law Act of 10 April 1997 was adopted in order to introduce a support scheme based on two main pillars: (i) tradable property rights arising under the certificates of origin (the so-called “green certificates”) issued for every MWh of energy generated from a RES installation and (ii) an obligation of the electricity trading power companies to purchase energy generated in RES, subject to payment of a substitution fee in the event of failing to comply with this obligation (“Green Certificate System”).
As a result of enacting these special initiatives and support schemes, Poland had gradually become an attractive destination for foreign investors interested in RES sector, including in particular wind energy which was expected to experience the highest dynamics of growth. To sustain this positive trend, Polish Parliament adopted the RES Act which introduced the new RES support system, i.e. an auction system providing exclusive support for the owners of any new RES installations (i.e. installations that generated first energy after 1 July 2016) that win the online auctions (“Auction System”). At the same time, the owners of the existing RES installations (i.e. installations that started to produce energy before 1 July 2016) were left with the right to use the Green Certificate System.
According to the government’s intention, these systems, i.e. the Green Certificate System and the Auction System, were supposed to coexist in order to support the development of all types of RES installations. However in practice only the Green Certificate System was extended by half a year allowing the investors to complete their wind energy projects and put them in operation in the first half of 2016. Whereas starting from July 2016, which was the month when the Auction System were expected to be launched, the Polish wind energy sector has entered a phase of stagnation, lasting until today.
One of the main reasons for stopping the development of the wind energy industry was a dramatic policy shift, including a series of retroactive measures against RES, including in particular the Wind Energy Investments Act, which, among other changes, imposed significant restrictions on the location, development and operation of wind power plants (including both wind farms and individual wind turbines) on Polish territory, namely: (i) introduced a mandatory setback distance, i.e. a minimum horizontal separation between wind power plants and residential areas, that it is at least ten times the height of the wind turbine itself (“10H rule”); (ii) limited the possibility to build wind power plants (with the exception of micro-installations) exclusively to the areas designated for this purpose in the local zoning plans (adopted by the municipal council), which in case of Poland cover approximately 30% territory of the country; and (iii) resulted in higher local tax payable by the wind power plants owners (the average tax burden has risen by app. 30-40 PLN/MWh of energy produced).
The parlous state of Polish wind energy sector has been additionally worsened by the oversupply of green certificates leading to their price dropping below 40 PLN/MWh in 2017 (which is a level not sufficient to pay back the loans taken out by the investors) and the disturbances in functioning of support systems (the end of the Green Certificate System and limited number of auctions for wind energy organized within the Auction System), which all together have an obvious impact on the profitability of wind projects and decrease the rates of return available to investors.
This already critical situation of wind energy investors has been exacerbated by further legislative changes, including coming into force of: (i) the amendments to the RES Act, such as: (1) the amendment of 22 June 2016 (with effect from 1 January 2018), which deprived large RES producers (owning installations with capacity equal to or higher than 500 kW) from the ERO price (“Amendment of 22 June 2016”), and (2) the amendment of 20 July 2017 (with effect from 25 September 2017), which revised the way how the substitution fee for the green certificates is calculated (“Amendment of 20 July 2017”); as well as (ii) the regulations of the Minister of Energy (of 17 October 2016 and of 11 August 2017) on changing the quota of the electricity generated in RES which is covered by the mandatory purchase obligation, all of which have not only aggravated the problem of green certificates oversupply and sharp reduction of their price, but also triggered large scale termination of long-term electricity-supply contracts by state-controlled energy companies.
International legal protection can be enjoyed by the foreign investors through different types of investment treaties which require compensation for the damage suffered due host state’s actions that undermine the ownership or economic interest of their investments. These treaties can either apply between two countries (Bilateral Investment Treaties or BITs) or among a number of countries in a given region or in regard to a specific industry sector. The example of the latter type of treaty is provided by the Energy Treaty Charter (ECT), which provides protection for cross-border investments in the energy.
Foreign investors often face problems which for various reasons cannot be solved with the use of domestic measures. In the nineteenth-century the existence of these problems triggered the development of friendship, commerce, and navigation treaties (FCNs), which in the 20th-century evolved into BITs, i.e. bilateral investment treaties intended to promote, encourage and protect investments made by citizens and companies of one contracting state in the territory of another contracting State.
The world’s first BIT was signed between Germany and Pakistan in 1959. Soon later other Western European governments began singing BITs with selected developing States, leading to the explosive growth in the number of BITs in in the late 80s and beginning of the 90s.
To this date, almost 3,000 BITs have been concluded around the world, and Poland is currently a contracting party (signatory) to approximately 60 of them. As a consequence, not only in Poland but also in vast majority of countries around the world BITs have become the most common form of foreign investment protection, providing investors with basic guarantees of security and stability, while at the same time increasing the international capital flow.
Poland is a signatory to the ECT, which is sometimes referred to as a “free trade agreement”, or as a “post–Cold War miracle”. This is a multilateral agreement providing framework for cross-border cooperation in the energy industry that was negotiated and signed in a period between 1994 and 1995. Having entered into force in April 1998, to date the ECT has been signed or acceded by more than fifty states (including all EU Member States), the EU and Euratom. In addition to the signatories, over thirty countries and over ten international organizations have the status of observers to the ECT.
Designed to promote energy security through the operation of more open and competitive energy markets, the ECT provides for the principles of sustainable development and sovereignty over energy resources. The ECT's provisions focus on different areas regarding commercial energy activity, including in particular the protection of foreign investments.
As mentioned above, foreign investors enjoy international legal protection through different types of investment treaties which provide foreign investors with different types of guarantees, including in particular:
‒ the protection against expropriation or measures equivalent to expropriation, even if unintended;
‒ the right to be treated fairly and equitably (so called “fair and equitable treatment” (FET) standard, also known as “full and constant protection and security” standard or “international minimum” standard);
‒ the right to full protection and security;
‒ the protection against arbitrary or discriminatory treatment;
‒ the right to most favored national (MFN) treatment;
‒ the right to free transfer of funds and assets; and
‒ the protection against a breach of the host state’s contractual obligations or undertakings towards investors and/or their investments (so called “umbrella clause”).
Depending on the circumstances, the host state can be accused of violating one or, more frequently, a number of the above mentioned guarantees. As practice, in case of harmful actions involving regulatory structures of the investment framework, including in particular changes to the investment legislative regime, the investor’s claim would be typically based on the allegation that the host state breached the guarantee of fair and equitable treatment and/or its actions constituted an indirect expropriation.
Although the fair and equitable treatment (FET) standard is a very broad concept covering different requirements, arbitral tribunals seem to agree that the core element of this standard is the host state’s obligation to provide a stable legal and business environment. In this sense, the FET standard protects the “legitimate expectations” of foreign investors (also known as “reasonable investment-backed expectations”) with respect to their investments, based on the legal and business framework of the host state existing at the time when the investments were made.
Therefore, if the investment regulatory framework governing the investment changes in a way that was not anticipated or foreseen by the investor at that time of making the investment, then – according to a number of arbitral tribunals – such investor should be compensated for the damage caused by the changes. In practice, this means that the FET standard does not guarantee the investors that the regulatory regime of their investments will not change. Rather, it reaffirms that if the host state enacts new law or amends the existing lawin a way that is unpredictable and arbitrary, thus depriving the investors of the value and benefit of their investments, it may be considered liable for breaching the investment treaty obligations.
Such liability can arise especially when the legislative changes have an retroactive (retrospective) effect, i.e. they affect the existing investments by taking away or impairing rights acquired by the investors under existing laws, imposing on them new duties, or attaching a new and different legal effect to transactions made in the past. The host state can be deemed responsible for the breach also when it failed to provide a reasonable period of vacatio legis, i.e. period between the formal enactment of the changes to the legal framework of the investments and their entry into force, or to take necessary measures to bring clarity to the uncertainty surrounding the status and the development of the investments affected by such changes.
While balancing numerous considerations (including the host state’s right to regulate, which may involve changing previous legislation regarding a particular industry, where necessary and reasonably justified) some tribunals have taken the view that the FET standard protects the investors only from the changes in the investment framework that are contrary to the “specific commitments” made by the host state. In order to determine whether such changes violate the treaty protection, those tribunals examine whether the host state, by making regulatory changes, is attempting to avoid commitments that it has created or reinforced through its own acts.
Importantly, according to a number of arbitral tribunals these commitments do not have to be contained in particular agreements or decisions, but they can result from general domestic laws and regulations as well as general statements made by government officials and agencies, governing a vast number of investors. However, there are also tribunals who are less likely to find a breach of FET standard under such circumstances, arguing that a foreign investor can seek investment treaty protection only if the host state made specific representations, commitments, assurances or promises on which it relied when making the investment.
Either way, in order to qualify for protection, the investor's expectations have to be reasonable, based on the investment conditions offered by the host state at the time of the investment, including various factors such as business risk and industry’s regular patterns.
Another alleged breach likely involved in case concerning changes in investment legal framework is a claim of indirect (or “de facto”, or “creeping”) expropriation, i.e. the act of the host state which results in destroying the use and value of the investment, even though the actual title of the asset remains with the investor.
There are two acknowledged approaches to assessing the modification of the regulatory regime that affected the economic value the investment in the context of expropriation.
According to the first (narrow) approach, the loss of the economic value of the investment does not, by itself, constitute expropriation, because it does not result in taking (physical or virtual) possession of the investments. Whereas, the second (broader) approach allows to consider expropriation as an action having “a substantial effect on the property rights of the investor”, including “a loss of value that could be equal by its magnitude to a deprivation of the investment.” However, as Charanne and Construction v. Spain shows, even those tribunals who use the broader approach do not always consider a reduction in profitability (and any resulting decrease in the value of the shares) to be an indirect expropriation.
The above mentioned protection can be enjoyed by both: (1) legal entities (including companies, corporations, business associations and other organizations) incorporated or otherwise duly organized under the law of other contracting state (i.e. the state being a party to the applicable treaty) than the host state where the investment is made, and (2) natural persons who are nationals (citizens) of such other state.
In order to rely on an investment treaty, a “qualified investor” must prove that it has made an investment covered by the scope of that treaty. Most investment treaties contain a broad definition of investment, using an open-ended definition with a statement often covering “every type/kind of asset” or “every form of investment in the territory,” supplemented by a non-exhaustive list of examples.
Typically these examples refer to all types of assets which make up an investment, including: real and contractual property rights, shares or any other similar forms of (direct or indirect) participation in a company established in the host state (“local company”), intellectual property rights, bonds and concessions conferred by law or under contract.
In the context of investment treaty arbitration, the term “compensation” is commonly used to describe (a) a prerequisite for a lawful expropriation, (b) the form of reparation for damage suffered by the investors due to the host state's unlawful act, and/or (c) the obligation to pay damages as a consequence for a breach of contract.
The quantification of compensation is left for the tribunal to decide, in which case it approximates the amount of compensation for damage caused to the investor taking into account all the circumstances of the case.
The tribunal will award compensation, however, only if there is a sufficient causation between the actual breach of a relevant treaty and the damage suffered by the investor. In practice this means that in order to be compensated for the economic loss or any other type of damage resulting from the breach, the investor has to prove three basic elements: (a) cause (i.e. the wrongful act of the host state violating certain treaty provisions), (b) effect (i.e. the damage in question), and (c) a causal link between these two.
With the exception to provisions concerning expropriation, investment treaties usually do not specify compensation to which the investor is entitled due to host state's treaty violation. The lack of relevant provisions in this regard, however, has not refrained arbitral tribunals from awarding monetary composition for economic harm caused by beaches other than expropriation. This includes the breach of FET standard, in context of which tribunals often refer to the Chorzów Factory case, which allows them to “wipe out” all the consequences of the host state’s wrongful acts by awarding compensation equal to an amount of the “fair market value” (“full reparation”) of the investment, covering both incurred costs and lost profits. Importantly, this refers also to investments under development, i.e. those which have not yet reached operational stage, even though such investments does not have history of profits.
This brings us to the appropriate method of establishing the value of the investment, in the context of which tribunals typically use the discounted-cash-flow (DCF) method, allowing them to calculate its netpresent value (NPV) by using free cash flows discounted by the operating and capital costs. The exception to this common practice concerns the above mentioned investments under development, for the purpose of valuation which arbitral tribunals usually apply the comparable transactions methodology.
In any event, however, calculation of compensation involves certain degree of speculation as it requires from the tribunal to assume a hypothetical course of events which would have occurred had the wrongful acts not been carried out. For that reason, the exact amount of compensation awarded to the investor due to regulatory changes will depend on various factors, including in particular risks and uncertainties surrounding his investment. These, in turn, will typically vary based on the development stage of the investment, i.e. whether the investment was at its operational or development stage, and if so, whether it was an early or late stage.
The legal mechanism for bringing investment treaty claims, including claims for compensation, are set forth in the investor-state dispute settlement provisions that can typically be found in all modern investment treaties, including BITs signed by Poland and the ECT. Under these provisions each contracting state expresses its consent to submit future disputes to international arbitration. Once the investor interested in bringing a claim against the host state provides its own written consent, the state’s consent becomes legally binding and the investor is entitled to refer its claim directly before the arbitral tribunal. Such tribunal is composed of one or more independent and qualified arbitrators who solve the dispute by rendering an arbitral award which is not only final and binding upon the parties to that dispute, but also widely enforceable.
The arbitration proceedings against the host state is initiated by the investor filing a request for arbitration. However, before the investor can file such a request, most investment treaties require it to wait for a duration of a so called “cooling-off” period, i.e. a period of typically three or six months during which the investor and the host state are encouraged to find an amicable settlement of their dispute. The starting point of the cooling-off period is a written request of the investor to the host state initiating settlement discussions. In case of a failure to settle the dispute over cooling-off period, the investor can file a request for arbitration in accordance with applicable arbitration rules.
Frequently investors may choose between an “institutional” arbitration (administrated by an arbitration institution indicated in the treaty) and “ad hoc” arbitration (with no arbitration institution that administrates the proceedings). This choice, however, depends upon the terms of the investment treaty on the basis of which the investor is bringing the claim.
The most-often chosen arbitration institution administrating investor-state arbitrations is the International Centre for Settlement of Investment Disputes (ICSID). This organization was established in 1965 by the Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States (“ICSID Convention”) to facilitate the settlement of disputes arising between contracting states and foreign private investors by way of arbitration and conciliation. Poland, however, has never signed the ICSID Convection, which is why ICSID may possibly administer disputes against Poland only under the Additional Facility Rules, i.e. the rules which authorize ICSID to administer certain categories of disputes that fall outside the scope of the ICSID Convention, including in particular disputes where the disputing host state – like Poland – is not a party to that Convention.
The most frequent alternative to ICSID proceedings, which is applicable in the vast majority of investor-state arbitrations pending against Poland, is an “ad hoc” arbitration under Arbitration Rules of the United Nations Commission for International Trade Law (UNCITRAL). These rules provide parties with greater control over the process, allowing them to write their own rules, set their own timetables and proceed at their own pace. Another major advantage is that UNCITRAL arbitration usually costs less than institutional arbitrations as it excludes fees payed to the institution. This, however, may not be the case when parties decide to appoint a specific institution, such as the Permanent Court of Arbitration in the Hague, to administer the proceedings.
In addition, many investment treaties, including the ECT and BITs signed by Poland, allow investors to refer its dispute against the host state to arbitration institution other than ICSID, including in particular the Arbitration Institute of the Stockholm Chamber of Commerce (SCC) based in Stockholm and the International Court of Arbitration of the International Chamber of Commerce (ICC) based in Paris.
There is no doubt that the 2016-2017 reforms of the Polish RES sector have substantially and unpredictably altered the country's legal framework in reliance upon which foreign investors were induced to invest.
This includes in particular wind energy industry and changes made as a result of introducing: (1) the Wind Energy Investments Act and its “retrospective” setting restrictions due to which many investors – who legitimately expected that the rules under which they started their investments as well as the permits and other administrative decisions (such as the localization permissions and environmental approvals) they received during the investment process would continue to be in force after the new law coming into force – have been left in “investment limbo”, and (2) the Amendment of 27 June 2017 due to which many investors – who, on the basis of arrangements made with the state-owned enterprises, were ensured with a stable and predictable revenue stream – are facing depressing RES prices and unlawful termination of electricity-supply contracts which all together have put them on the edge of bankruptcy.
These regulatory changes, in turn, have created a strong case for all the above mentioned wind investors referring their claims for compensation to international arbitration under BITs or ECT, arguing that Poland has breached its investment treaty obligations, including in particular its obligation to treat investors fairly and equitably and not to undertake measures constituting expropriation, and therefore should be held liable for damages that suffered by the investors.
The outcome of arbitration, like any other dispute resolution methods, is difficult to predict, as it always depends on the specific facts and circumstances of each case. As practice shows, arbitral tribunals deciding in similar cases (including in particular arbitrations against Spain, Czech Republic and Italy who also decided to scale back their original RES investment incentives), are not consistent when it comes to answering the question as to whether the regulatory changes to the RES incentive regimes leads to expropriation or a denial of fair and equitable treatment.
It seems however that in case of Poland arguments in support of finding such investment treaty breaches are particularly strong, especially given the fact that all of the above discussed legislative changes had a very short period of vacatio legis and Polish government did little to address the legal and contractual situation in which investors found themselves after their implementation. Not to mention the criticism of the business community indicating that these changes were devoid of economic substance and made solely for the purpose of reducing the development of Polish wind energy sector, as the new government is committed to boost natural gas and coal sectors at the expense of other sectors.
 Data regarding Polish wind energy capacity comes from: www.ure.gov.pl.
 Under the RES Act the quota of the energy covered by the mandatory purchase was established at the level of 19,35%, and then – due to subsequent regulations – has been reduced. Whereas its price – until 1 January 2018 – was regulated, i.e. calculated and published by the President of the President of the Energy Regulatory Office (“ERO price”).
 Most of the provisions of the RES Act came into force on 4 May 2015, with the exception to Chapter 4 – including provisions on the support system for RES – which came into force on 1 July 2016.
 The amendment to the RES act of 29 December 2015 postponed the date when RES producers could have enter the Green Certificate System from 31 December 2015 to 30 June 2016.
 Before the Wind Investments Act came into force, there was no mandatory setback distance in place. The minimum distance was dependent on the noise levels, which required the wind power plant to be placed in a minimum distance of app. 500 meter from residential areas. Whereas, under the new regulation, given the parameters of modern wind turbines, the minimum distance based on the 10H rule means app. 1.5 to 2 km from such areas. Importantly, this rule does not affect the existing power plants, with the exception to their modernization, in which case the power plant under modernization is required to meet the minimum distance requirement. At the same time, this requirement does not apply to the wind energy projects under development where investors had applied for building permits or such permits had been issued before the Wind Investments Act came into force, provided that operating permits for such projects will be issued within 3 years from the date of entry into force of the Wind Investments Act. Whereas the wind energy projects under development where investors had not applied for building permits before the Wind Investments Act came into force are required to meet the setback distance.
 Before the Wind Investments Act came into force, if there was no zoning local plan in force for the territory where a wind turbine was to be located, an investor could locate it on the basis of the planning permission. Whereas, under the Wind Investments Act such a possibility excluded.
 Before the Wind Investments Act came into force, the tax payable by the wind power plants owners was calculated only on the value of the building elements of such plants (including tower and the foundations) but not their technical elements, as the latter ones are excluded from the definition of structure (budowla) provided by the Building Law. Whereas the Wind Investments Act defines a power plant as a structure composing of both building and technical elements, as a result of which it creates a risk that value of the technical elements will no longer be exempt from the local tax.
 The substitution fee previously amounted to a fixed sum of 300.03 PLN/MWh. Setting the fee at such high level aimed at encouraging the energy companies to purchase of the green certificates form RES producers instead of paying the fee. Whereas under the Amendment of 20 July 2017 the substitution fee equals 125% of the annual average price of green certificates announced by the Polish Power Exchange, but not more than 300.03 PLN, which – given the fact that in 2017 the average price amounted to 73.63 PLN – means a decrease in the substitution fee from 300.03 to 92.04 PLN, which eliminates its incentive nature.
 On the basis of art. 59 of the RES Act, this obligation was set at 19.35%, but then - in accordance with the relevant regulations of the Minister of Energy - it was first reduced to 15.40% (in 2017), then it was increased to 17.50% (in 2018) and 18.50% (in 2019), which still is below the pre-set level.
 Additional claim can be based on an “umbrella clause” which can be found in some of the investment treaties, including for instance the ECT. This type of clause typically requires a host state to observe any obligation it has undertaken in relation to an investor, thus serving to bring any contractual agreements between the investor and the host state under the treaty protection.
 The basic requirements derived from The FET standard are as follows: (i) to act in a transparent, predictable, and rational manner; (ii) to act in good faith and without the use of harassment, coercion, or abuse of power; (iii) to respect due process; and (iv) not to act in a way that is arbitrary, grossly unfair, unjust, discriminatory, or inconsistent.
 See, e.g., LG&E Energy Corp., LG&E Capital Corp. and LG&E International Inc. v. Argentine Republic (“LG&E v. Argentina”), ICSID Case No. ARB/02/1, Decision on Liability of 3 October 2006, para 147; CMS Gas Transmission Company v. The Republic of Argentina (“CMS v. Argentin”), ICSID Case No. ARB/01/8, Award of 12 May 2005, para 274.
 Técnicas Medioambientales Tecmed, S.A. v. United Mexican States, ICSID Case No. ARB(AF)/00/2, Award of 29 May 2003, para 154.
 See, e.g., Suez, Sociedad General de Aguas de Barcelona S.A. and InterAgua Servicios Integrales del Agua S.A. v. Argentine Republic, ICSID Case No. ARB/03/17, Decision on Liability of July 30 2010, para 207; Total S.A. v. Argentine Republic, ICSID Case No. ARB/04/1, Decision on Liability of 27 December 2010, para 122.
 See, e.g., Saluka Investments B.V. v. Czech Republic, Permanent Court of Arbitration, Partial Award of 17 March 2006, para 305 (“no investor may reasonably expect that the circumstances prevailing at the time the investment is made remain totally unchanged”).
 See, e.g., Eiser Infrastructure Limited and Energía Solar Luxembourg S.à r.l. v. Kingdom of Spain (“Eiser and Energía Solar v. Spain”), ICSID Case No. ARB/13/36, Award of 4 May 2017, paras 362 ff. Cf Isolux Infrastructure Netherlands B.V. v. Kingdom of Spain, SCC Case No. 2013/153, Award of 21 January 2016, paras 764 ff.; Charanne B.V. and Construction Investments S.A.R.L. v. Spain (“Charanne and Construction v. Spain”), SCC Arb No. 062/2012, Award of 21 January 2016, paras 499 ff.
 See, e.g., Windstream Energy LLC v. The Government of Canada (“Windstream v. Canada”), PCA Case No. 2013-22, Award of 27 September 2016, para 380.
 See, e.g., AES Summit Generation Limited and AES-Tisza Erömü Kft. v. Republic of Hungary (II), ICSID Case No. ARB/07/22, Award of 23 September 2010, para 9.3.34.
 See, e.g., Gas Transmission Company v. The Argentine Republic, ICSID Case No. ARB/01/8, Award of 12 May 2005, para 277.
 See, e.g., Kardassopoulos v. Georgia, ICSID Case No. ARB/05/18, Award of 3 March 2010, paras 275 ff.
 See, e.g., Total S.A. v. Argentina, ICSID Case No. ARB/04/1, Decision on Liability of 27 December 2010, paras. 310–12; Charanne and Construction v. Spain, SCC Arb No. 062/2012, para 499; EDF (Services) Ltd. v. Romania, ICSID Case No. ARB05/13, Award of 8 October 2009, para 217.
 See, e.g., LG&E v. Argentina, ICSID Case No. ARB/02/1, Decision on Liability of 3 October 2006, para 130; Saluka Investments BV v. The Czech Republic, Partial Award of 17 March 2006, paras 189; Electrabel S.A. v. Hungary, ICSID Case No. ARB/07/19, Decision on Jurisdiction, Applicable Law and Liability of 30 November 2012, para. 7.75; Parkerings-Compagniet AS v. Republic of Lithuania,ICSID Case No. ARB/05/8, Award of 11 September 2007, paras 174.
 Ronald S Lauder v. Czech Republic, Final Award of 3 September 2001, para 109,Total S.A. v. The Argentine Republic,ICSID Case No. ARB/04/1, Decision on Liability of 27 December 2010, para 127.
 Nykomb Synergetics Technology Holding AB (Sweden) v. Latvia, SCC - Case No. 118/2001, Arbitral Award of 16 December 2003, para 4.3.1.
 Charanne and Construction v. Spain, SCC Arb No. 062/2012, Award of 21 January 2016, paras 461.
 Ibidem, paras 462 ff.
 In some cases also legal entities established in the host state may be a beneficiary of the treaty protection if (a) they are controlled by the entities incorporated in other contracting state than the host state, and (b) both these states have agreed in the applicable treaty to extend the treaty to such entities.
 N. Blackaby , C. Partasides , et al., Redfern and Hunter on International Arbitration (Sixth Edition), Kluwer Law International; Oxford University Press 2015, para 8.141. See also Rumeli Telekom AS and Telsim Mobil Telekomunikasyon Hizmetleri AS v. Republic of Kazakhstan (“Rumeli v. Kazakhstan”), ICSID Case No. ARB/05/16, Award of 29 July 2008, para 224.
 Case concerning the factory of Chorzów (Claim for Indemnity), German v. Poland, 1928 PCIJ Series A No. 17, at 47.
 See, e.g., MTD Equity Sdn Bhd & MTD Chile SA v. Republic of Chile, ICSID Case No. ARB/01/17, Award of 25 May 2004, para 238; Petrobart Ltd. v. Kyrgyz Republic, SCC Arbitration No. 126/2003, Award of 29 March 2005, at 30; Azurix Corp. v. The Republic of Argentina, ICSID Case No. ARB/01/12, Award of 14 July 2006, para 159; BG Group Plc v. The Republic of Argentina (“BG v. Argentina”), UNCITRAL, Award of 24 December 2007, paras 423 ff; S.D. Myers, Inc. v. Canada, UNCITRAL, Partial Award of 13 November 2000, paras 311 ff.
 See, e.g., Karaha Bodas Co. v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara, UNCITRAL, Award of 18 December 2000, para 136; AIG Capital Partners, Inc. and CJSC Tema Real Estate Company v. Republic of Kazakhstan, ICSID Case No. ARB/01/6, Award of 7 October 2003, at 113.
 See, e.g., CMS v. Argentina, Award of 12 May 2005, paras 434 ff; Eiser and Energía System v. Spain, ICSID Case No. ARB/13/36, Award of 4 May 2017, at 141; BG v. Argentina, Award of 24 December 2007, paras 430 ff.
 See, e.g., Windstream v. Canada, PCA Case No. 2013-22, Award of 27 September 2016, paras 474 ff; Crystallex International Corp. v. Bolivarian Republic of Venezuela, ICSID Case No. ARB(AF)/11/2, Award of 4 April 2016, paras 886 ff.
[*] MA, PhD (Jagiellonian University in Kraków), LLM (Queen Mary University of London), Advocate (Polish Bar Council), Board Member of ADR Commission (ICC Poland), Counsel in Dispute Resolution and Arbitration Practice (Warsaw office of Drzewiecki Tomaszek and Partners Law Firm). Dr. Sabina Kubsik can be contacted at email@example.com.