The Supreme Court of Canada declines leave to appeal the Québec Court of Appeal’s decision clarifying state immunity, seizure, and alter ego exposure in investor-state awards.

Background

The consolidated appeal before the Québec Court of Appeal involved three files arising from efforts by Devas’s investors’ successors (CCDM/Devas) to recognize and enforce in Québec two foreign arbitral awards against the Republic of India. CCDM/Devas also sought to preserve assets via pre-judgment garnishments of funds held by The International Air Transport Association (IATA), based in Montreal, on behalf of India’s Airport Authority.

The underlying dispute related to an agreement between Devas Multimedia Services and Antrix, the commercial arm of India’s space program, for leased satellite spectrum. After Devas’s initial payment, Antrix terminated the contract on national security grounds, and India subsequently expropriated Devas’s property.

The Mauritian investors in Devas Multimedia brought parallel arbitrations: the ICC issued a substantial damages award against Antrix, and the Permanent Court of Arbitration awarded damages against India in favour of Devas’s investors and shareholders.

When the creditors sought to enforce the awards in Québec, India and the Airport Authority of India raised sovereign immunity. The Court of Appeal was required to address threshold jurisdictional questions under the federal State Immunity Act RSC, 1985, c. S-18 and the scope of any waiver.

Decision

The Court of Appeal made three key conclusions:

  1. The Court held that a foreign state could waive immunity by voluntarily submitting to arbitration. The Court identified an applicable exception to immunity based on India’s conduct and commitments. It found that India had explicitly waived sovereign immunity by ratifying the New York Convention, entering into a bilateral investment treaty containing an agreement to arbitrate investor-state disputes, and participating in the arbitration without reserving its rights to immunity. On that basis, the Court determined that Canadian courts could exercise jurisdiction in the enforcement proceeding.
  2. The Court recognized that the loss of immunity could extend to an alter ego of the state where the facts support state control. As the Court found that the Ministry of Civil Aviation was exercising complete control over the Airport Authority of India, it determined that the Airport Authority of India was an alter ego of India for the purposes of the funds at issue. The consequence was that the loss of immunity attaching to India extended to the Airport Authority of India as well.
  3. The Court held that state immunity arguments do not bar the granting of pre‑judgment seizures. It determined that a party seeking pre‑judgment seizure of assets did not need to establish jurisdiction over a foreign state before obtaining a seizure order. While a lack of jurisdiction may later justify setting aside a seizure, establishing jurisdiction is not a precondition to provisional relief.

On September 18, 2025, the Supreme Court of Canada dismissed applications by the Republic of India and the Airport Authority of India for leave to appeal.

Analysis

As a result of the Supreme Court refusing leave to appeal, the Court of Appeal’s decision now stands as authoritative guidance on key questions of sovereign immunity and its waiver in Québec and will likely be viewed as persuasive authority in other Canadian jurisdictions. The Supreme Court’s dismissal leaves intact a comprehensive appellate analysis of how Canada’s State Immunity Act applies in the context of recognition and enforcement proceedings arising from arbitral awards.

More broadly, the judgment affirms that Canada’s State Immunity Act is to be applied with attention to the realities of international arbitration and state conduct, ensuring that express commitments to arbitrate and subsequent participation do not become illusory at the enforcement stage. For award creditors and sovereign counterparties alike, the operative lesson is that the path to enforcement in Canada turns on the interplay of treaty language, procedural conduct, and statutory exceptions, and that these factors will be assessed holistically by Canadian courts.

Republic of India v. CCDM Holdings LLC, 2025 CanLII 94240 (SCC)

Republic of India c. CCDM Holdings, 2024 QCCA 1620