FOLLOW US

AES Corp., a leading U.S. power company, has formally requested that a federal court in the District of Columbia enforce its $824 million arbitral award against the Republic of Argentina. The award was granted earlier this year following Argentina’s alleged interference with electricity generation assets owned by AES’s local affiliates.

In its petition filed Monday, AES emphasized that the court has full jurisdiction to recognize and enforce the award. AES argued that Argentina is not entitled to sovereign immunity under the Foreign Sovereign Immunities Act (FSIA), as the country waived such immunity by becoming a party to the International Centre for the Settlement of Investment Disputes (ICSID) Convention.

AES explained that the ICSID Convention is a valid treaty requiring enforcement of arbitral awards and grants subject matter jurisdiction to D.C. courts. The company further noted that the FSIA permits the court to exercise personal jurisdiction over Argentina in this matter.

The arbitration award, issued on May 30, arises from claims that Argentina breached its obligations under the 1991 Argentina-United States bilateral investment treaty (BIT). AES’s local affiliates—AES Argentina Generación SA and TermoAndes SA—have been active in Argentina’s electricity sector since 1993, a period during which AES invested hundreds of millions of dollars under protections provided by the BIT and ICSID.

AES stated that during Argentina’s 2001 economic crisis, the government implemented measures that fundamentally undermined the legal and economic framework supporting AES’s investments. These included unilateral changes to electricity generation remuneration, withholding substantial payments owed to AES’s subsidiaries, and imposing conditions on repayment linked to construction of new generation plants.

Following failed settlement attempts from 2006 to 2018, AES resumed arbitration proceedings in 2022 with a reconstituted tribunal, which unanimously found Argentina had violated the BIT. The final award comprises $715.9 million in damages plus $15.8 million in legal fees, with a current total value of $824.4 million including interest.

AES is represented by counsel from Freshfields US LLP and Chaffetz Lindsey LLP. Argentina’s legal representation included the Attorney General of the Nation’s Treasury in Buenos Aires and Wordstone Dispute Resolution AARPI in Paris.

The case, AES Corp. v. Argentine Republic (No. 1:25-cv-02540), is pending in the U.S. District Court for the District of Columbia.