Following an application by Romania and the European Commission (as intervener), the English High Court has stayed enforcement of an ICSID award in favour of Swedish business magnates the Micula brothers. 

The case will be determined following the decision of the General Court of the European Union in connected proceedings brought by the Micula brothers to annul the Commission’s determination that the payment of the ICSID award by Romania would amount to illegal State aid.   

The case raises important questions about the effectiveness of ICSID awards in circumstances where the awards clash with Member States’ obligations under EU law.


On 11 December 2013 an ICSID award (“Award”) of US$90 million in favour of Iaon and Viorel Micula (and associated entities) was rendered against Romania. 

The European Commission subsequently issued a decision (“EC Decision”) to the effect that any implementation of the Award by Romania would amount to illegal State aid.

The Micula brothers are now seeking to enforce the Award in the English, French, Belgian, Luxembourgish, Swedish and US courts.

The English Proceedings

Following registration of the Award in England in October 2014, Romania applied to the English court in July 2015 to set aside the registration or alternatively, for the issues raised to be submitted to the European court for determination.

Giving judgment on Romania’s application, Blair J found that as the Award had been rendered prior to the EC Decision it was res judicata and its validity could not be impacted by the EC Decision.  However, this finding was of limited use for the Miculas because the “principle of sincere cooperation” established by Art. 4(3) of the Treaty of the European Union  prevented the court from taking any decision which would conflict with a decision of the Commission.  Accordingly, though the court refused Romania’s application to set aside the registration of the Award, it was not able to order enforcement of the Award as this would create conflict with the EC Decision. 

The Miculas sought to rely on the Arbitration (International Investment Disputes) Act 1966 implementing the ICSID Convention which requires the court to treat any ICSID award as a final judgment of the English High Court.  The court found that there was no conflict with the UK’s duties under the ICSID Convention as the UK had registered the Award so that it was equivalent to a final domestic judgment for enforcement purposes.  A final domestic judgment would also have been subject to the principle of sincere co-operation and so treated in the same way as the Award.

To avoid a ruling which conflicted with the EC Decision, the court stayed final determination on enforcement of the Award until the European court had ruled on the Miculas’ application to it for an annulment of the EC Decision.

The court was persuaded by the Miculas’ argument that Romania should provide security for the duration of the stay of the proceedings.  This was because of the length of time that the Award had remained unpaid, the finality of the Award and the requirement on the court to treat the Award as a domestic judgment.  However, the court invited the parties to make further submissions on its power to make an order for security.


The judgment raises questions for EU Member States about the conflict between their obligations under EU law and the ICSID Convention.  In particular, it appears to undermine the key principles of finality and certainty in respect of awards arising from international trade disputes.

This is because, whilst the court has yet to make a final determination in the case, it has interpreted the UK’s obligations under the ICSID Convention in a way that may prevent the enforcement of a valid and final ICSID award to avoid conflict with EU treaty obligations. 


Duncan Hedar

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