Blusun v Italy

Blusun S.A., a holding company incorporated in Belgium, and its shareholders Jean-Pierre Lecorcier and Michael Stein, filed a request for arbitration against Italy, contesting Italy’s changes to the legal regime governing investments in the photovoltaic (PV) sector. In particular, the investors challenged a series of measures taken by the Italian authorities between 2010 and 2012, alleging that such measures breached the FET standard under ECT Article 10(1) and had an effect equivalent to nationalization or expropriation under ECT Article 13(1). The Tribunal found that while the reduction in feed-in tariffs introduced by the decrees were substantial, it was a response to a genuine fiscal need, falling “within the range or legal risk of an industrial enterprise, in particular one based on debatable regulatory grounds”. The Tribunal dismissed all of the claimants’ claims on the merits.