The Tribunal in Gabriel Resources v Romania recently issued an order (the Order) in response to an application (the Application) made by three Romanian NGOs, as non-disputing parties, for participation and an amicus submission (the Submission) in an ICSID arbitration under the Canada-Romania BIT (the BIT). Gabriel Resources’ allegations of breach of the BIT arise in relation to a proposed open pit mining development in Roşia Montană, Romania (the Project) which was not implemented.
The Tribunal granted the Application in part, admitting only certain sections of the Submission to the extent that they referred to factual issues within the specific knowledge of the Applicants and in relation to the interests which the Applicants claim to be protected. However, the Tribunal denied admission to arguments on the law, as well as references to or reliance on testimonies which could not be tested by cross-examination. The Tribunal also rejected the NGOs’ request to attend and participate in the oral hearing.
The Tribunal’s analysis of the conditions relevant to an application by non-disputing parties – and its approach of considering each section of the Submission in relation to those conditions (rather than the Submission as a whole) – provides a significant contribution to jurisprudence in this area. The application in Gabriel Resources is also consistent with a general increase in such third party interventions, particularly in disputes which touch on issues of public interest, such as environmental protection, public health measures, labour standards, cultural rights and/or human rights. Such a trend is likely to continue with civil society becoming more active in this context.
In a press release issued yesterday, the European Commission announced that it has ordered Romania to recover compensation paid pursuant to an ICSID award, concluding that the grant of such compensation is incompatible with EU State Aid rules.
This latest development raises interesting questions regarding the overlap of EU law with international treaty obligations in the context of intra-EU investment treaty disputes.
In Ioan Micula and others v Romania (ICSID Case No. ARB/05/20), an ICSID tribunal considered whether Romania was in breach of the Sweden-Romania bilateral investment treaty.
The majority of an ICSID tribunal (Laurent Lévy and Stanimir Alexandrov) held that Romania breached the fair and equitable treatment standard in the Sweden-Romania bilateral investment treaty by repealing incentives offered regarding investments made in some of the country’s deprived regions. A different majority (Laurent Lévy and Georges Abi-Saab) dismissed the claimants’ allegation that Romania had breached the umbrella clause in the BIT due to lack of evidence. The tribunal also discussed the role of EU law within the context of investment treaty disputes.
The award is of interest as it discusses in detail the FET standard and even proffers a test in respect of the stability aspect often considered to fall within the scope of FET. The award also concludes (departing from other cases) that unilateral declarations made by a state would fall within the scope of an umbrella clause. Finally, the discussion in the award of EU issues is topical, given the number of ongoing disputes where the inter-relation between EU law and investment treaty arbitration is in issue.