White & Case has persuaded UK's Supreme Court to accept the petition of Romanian entrepreneur Ioan Micula and the companies in which he has invested, enabling an action to enforce a 2013 ICSID arbitral award of approximately EUR 300 million, with interest.
"With the ongoing proceedings before the EU courts, the Micula saga is far from over," said White & Case Local Partner Kai Struckmann. "But this judgment is an important step, together with the judgment of September 2019 secured in the US District Court for the District of Columbia, in recovering the award rendered in favor of our client over six years ago."
The firm reports that “the 2013 award resulted from a claim under the Sweden-Romania bilateral investment treaty and arose out of the repeal by Romania of investment incentives that the Micula brothers had relied on when making substantial investments in Western Romania in the early 2000s. An ICSID tribunal rendered the award in favor of Mr. Micula, his brother and co-investor, and three companies they had invested in. However, their efforts to enforce the award were impeded by a 2015 European Commission decision holding that payment by Romania of the award was prohibited under EU State aid rules (the EC Decision).”
In June 2019, the Micula brothers prevailed in the European Union's General Court, which annulled the EC Decision in full, and clarified that the European Court of Justice's Achmea judgment, regarding the incompatibility of arbitration clauses in intra-EU BITs, does not apply in this pre-accession context. This judgment is currently under appeal at the Court of Justice of the European Union.
The UK Supreme Court's judgment has lifted the stay on enforcement of the award previously granted to Romania by the High Court and upheld by the Court of Appeal. The Supreme Court held that the duty of sincere co-operation under EU law is not applicable in this case, where the UK has a prior obligation under the ICSID Convention to enforce the Award. The Supreme Court overturned the orders of the High Court and Court of Appeal, which had ruled that enforcement should be stayed pending the outcome of proceedings before the EU courts concerning the validity of the EC Decision.
White & Case’s team representing Ioan Micula before the courts in England included London-based Partner David Goldberg and Associate Aqeel Kadri; its team representing Micula before the EU courts included Brussels-based Partners Kai Struckmann and Genevra Forwood and Counsel Nicholas Forwood with London-based Associate Aqeel Kadri also participating.