Micula & Ors v Romania (Rev 1)

Micula & Ors v Romania (Rev 1)

The Kapferer principle does not prevent the English court from staying enforcement of the ICSID award where enforcement would conflict with an EU Commission State aid decision. The duty of sincere cooperation under EU law requires the court to refrain from enforcement pending the outcome of the annulment proceedings before the GCEU. The 1966 Act does not override this duty, and a temporary stay is justified. However, the court has power to order Romania to provide security as a condition of the stay, as this does not conflict with the Commission's decision.

Parties
Claimant / Appellant: Viorel Micula; Claimant / Appellant: Ioan Micula; Claimant / Appellant: S.C. European Food S.A.; Claimant / Appellant: S.C. Starmill S.R.L.; Claimant / Appellant: S.C. Multipack S.R.L.; Defendant / Respondent: Romania; Intervener: European Commission
Jurisdiction
England and Wales
Judgment Date
27 July 2018
Procedural Posture
Civil Appeal / Appeal From Commercial Court (queen's Bench Division) to Court of Appeal
Outcome
Stay Appeal dismissed; Security Appeal allowed
Legal Topics
Enforcement of ICSID Awards, State Aid, Res Judicata, EU Treaty Interpretation, Sincere Cooperation, Article 351 TFEU, Security for Stay of Execution
International Arbitration EU Law Public International Law Enforcement of ICSID Awards State Aid Res Judicata EU Treaty Interpretation Sincere Cooperation +2 more

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Parties

Viorel Micula

Claimant / Appellant

Ioan Micula

Claimant / Appellant

S.C. European Food S.A.

Claimant / Appellant

S.C. Starmill S.R.L.

Claimant / Appellant

S.C. Multipack S.R.L.

Claimant / Appellant

Romania

Defendant / Respondent

European Commission

Intervener

Procedural Posture

Civil Appeal / Appeal From Commercial Court (queen's Bench Division) to Court of Appeal

Legal Issues

  1. 1 Whether the Kapferer principle (res judicata) precludes a stay of enforcement of an ICSID award conflicting with an EU Commission State aid decision
  2. 2 Whether the Arbitration (International Investment Disputes) Act 1966 obliges the English court to enforce the ICSID award despite EU law
  3. 3 Whether EU law duties or the ICSID Convention obligations prevail in case of conflict

Ratio Decidendi

The Kapferer principle does not prevent the English court from staying enforcement of the ICSID award where enforcement would conflict with an EU Commission State aid decision. The duty of sincere cooperation under EU law requires the court to refrain from enforcement pending the outcome of the annulment proceedings before the GCEU. The 1966 Act does not override this duty, and a temporary stay is justified. However, the court has power to order Romania to provide security as a condition of the stay, as this does not conflict with the Commission's decision.

Court Disposition

Stay Appeal dismissed; Security Appeal allowed

Orders

  • Enforcement of the ICSID award stayed pending determination of the GCEU proceedings or further order
  • Romania to provide security in the sum of £150 million as a term of the stay, but non-compliance does not automatically lift the stay