Luxembourg Court of Cassation nullifies the waiver to immunity granted by Romania in BIT (N° 116/2022 of 14 July 2022)

Article summary

Arbitration analysis: The recent developments brought by the Luxembourg Court of Cassation’s decision on Micula v Romania have raised questions and concerns in the legal sphere. The case has shown how enforcing arbitral awards in EU Member States has become more complicated, making international investments risky and precarious. Luxembourg Court of Cassation and Court of Appeal therefore have dissimilar interpretations of the relevant moment in which Romania waived its right to jurisdictional immunity. This situation leads to the need for clarification on the scope of arbitration clauses included within existing bilateral investment treaty on the promotion and reciprocal protection of investments (BITs), given the application in time of EU legislation, once a state becomes a new Member of the EU, or is going to become one, in order to protect investors’ rights. Written by Laure-Hélène Gaicio-Fievez and Magedeline Mounir, Avocat à la Cour, Bonn, Steichen & Partners.