ATOME PLC Takes Action Against Paraguay Over Investment Treaty Violations

In a significant development for international investment relations, ATOME PLC, a leading UK-based developer of low-carbon fertilizers, has announced its intention to submit a claim to arbitration against the Republic of Paraguay. This decision stems from alleged violations of the UK-Paraguay Bilateral Investment Treaty (BIT) related to ATOME's ambitious Villeta Project, which represents the largest single foreign industrial investment in Paraguay's history, amounting to $665 million.

ATOME, which specializes in low-carbon fertilizer development, has stated that it remains actively engaged in negotiations regarding its shovel-ready project. However, the company is also mindful of its responsibilities to its shareholders and its commitment to safeguarding its legitimate rights in the face of what it claims to be Paraguay's unlawful actions.

On September 17, 2026, ATOME PLC, via the law firm White & Case LLP, delivered an official Notice of Dispute to the Paraguayan government. This document outlines that an investment dispute has arisen due to Paraguay's actions that are alleged to breach the BIT, specifically concerning the revocation of key Presidential Decrees that previously supported the Villeta Project. These decrees provided essential certainty regarding the project's terms and pricing under the associated Power Purchase Agreement (PPA).

The Notice further invites the Paraguayan government to engage in constructive discussions to amicably resolve the issues at hand. It has also been communicated to various diplomatic entities, including the UK government and embassies of the EU, France, Germany, and the United States, emphasizing the international implications of this dispute. If a resolution is not reached within three months, ATOME expresses its intent to escalate the matter to the International Centre for Settlement of Investment Disputes in Washington, D.C.

The Villeta Project is poised to revolutionize the green fertilizer market in Paraguay, potentially positioning the nation as a global leader in sustainable fertilizer production. Successful completion of the project is expected to significantly enhance food security within the region, creating approximately 4,000 jobs during the construction phase and over 1,000 permanent positions during operations, which would have a measurable positive impact on Paraguay's GDP and overall economy.

Despite these challenges, ATOME remains committed to pursuing a constructive resolution to the dispute while maintaining its rights under international law if necessary. This situation highlights the complexities and potential risks associated with international investments, especially in regions where political and regulatory environments may shift unexpectedly.

For its part, the company has stated it will keep investors and stakeholders informed throughout the proceedings. Meanwhile, ATOME's other projects continue uninterrupted, reflecting the company’s robust strategy for sustainable growth.

In recent developments, ATOME announced an unconditional Final Investment Decision on the Villeta Project earlier in May 2026, following the successful completion of project financing backed by prominent international development finance institutions and private investors. The project also benefits from a long-term Definitive Offtake Agreement with Yara International, a leading global fertilizer company, ensuring stable demand for its environmentally-friendly products.

The agricultural sector contributes a significant amount of greenhouse gas emissions globally, with fertilizer utilization being a primary source of these emissions. ATOME's green Calcium Ammonium Nitrate product aims to address these concerns by providing a low-carbon alternative to traditional fertilizers that rely on fossil fuels. This innovative approach not only supports regional food security goals but also contributes to the global effort to mitigate climate change.

ATOME PLC is backed by a green-focused board and major shareholders who are aligned with its mission to disrupt the traditional fertilizer industry and promote sustainability in agriculture. As the situation unfolds, ATOME's actions will undoubtedly have significant implications not just for its operations but for the broader landscape of international investment and sustainable development in Paraguay and beyond.