PRESS RELEASE on the results of the arbitration Gabriel Resources v. Romania, Arbitration Award of 8 March 2024 of the International Centre for the Settlement of Investment Disputes attached to the World Bank (ICSID/CIRDI).
Congratulations and warm thanks to all those who supported the LALIVE consortium and Leaua Damcali Deaconu Paunescu (LDDP) in supporting Romania’s interests in this important international arbitration.
We are proud of our team: Professor Crenguta Leaua, Professor Stefan DEACONU, Andreea N. Simulescu, FCIArb, LILIANA (TOADER) DEACONESCU, andra filatov Corina Tanase, Aurora Damcali and Marius Grigorescu.
In Gabriel Resources Ltd. and Gabriel Resources (Jersey) v. Romania (ICSID Case No. ARB/15/31) The Arbitral Tribunal rendered the Arbitral Award on 8 March 2024.
In a majority decision, the tribunal dismissed all of the claimants’ claims on the merits and awarded a substantial portion of Romania’s arbitration costs.
The General Court was composed of Prof. Pierre Tercier (President of the General Court), Dr. Horacio A. Grigera Naón and Prof. Zachary Douglas.
This decision puts an end to the arbitration proceedings that were initiated by Gabriel Resources in July 2015. During the arbitration, the Parties exchanged more than 25 memoranda and participated in two main hearings, one from 2 to 13 December 2019, which dealt with liability, and one from 28 September to 4 October 2020, which focused on technical and quantum issues.
Gabriel Resources argued in the arbitration that Romania violated the Canada-Romania bilateral investment treaty and the UK-Romania bilateral investment treaty, including the obligation not to expropriate investments without compensation. Gabriel Resources requested a total of approximately $6.7 billion, including interest.
In response, Romania argued that Rosia Montana Gold Corporation, the consortium between Gabriel Resources and Romanian state-owned Minvest, failed to meet permit requirements, largely as a result of failing to obtain a social license for the mining project.
The tribunal took into account the many environmental, social, cultural and economic challenges faced by the mining project, finding that the Romanian authorities had fulfilled their “regulatory mandate to the best of their ability in these difficult circumstances”.
After rejecting Gabriel Resources’ claim that Romania had violated the two bilateral investment treaties, the tribunal did not examine the parties’ arguments regarding the amount of damages.
The Arbitral Award will be published on the website of the International Centre for Settlement of Investment Disputes attached to the World Bank (ICSID/CIRDI) once confidential information is anonymized in the award.
Romania was represented in the arbitration by the consortium LALIVE and Leaua Damcali Deaconu Paunescu (LDDP). The LALIVE team was led by Dr. Veijo Heiskanen, Matthias Scherer, Lorraine de Germiny and Noradèle Radjai. Other members of the team were Christophe Guibert de Bruet, David Bonifacio, Emilie McConaughey and Baptiste Rigaudeau. The LDDP team was led by Prof. Crenguta Leaua and included Prof. Stefan Deaconu, Andreea Simulescu, Liliana Deaconescu, Andra Soare-Filatov, Corina Tanase, Aurora Damcali and Marius Grigorescu. The team also temporarily included Mihaela Maravela and Andreea Piturca.
Commenting on the outcome, Prof. Leaua states: “The Romanian Government has faced, over the last decades, a particularly complex situation regarding the Rosia Montana project. Attention was needed both for the socio-economic development of the region and for environmental protection and compliance with all administrative-procedural requirements imposed by law for such a project. Constant efforts have been made to navigate this complexity and respect the rights of both investors and Romanian citizens.
We are pleased to see that the ICSID arbitral tribunal understood the situation and the arguments presented by us in Romania’s defence and reached a decision confirming that Romania has complied with its obligations towards the foreign investor as set out in the mutual investment protection treaties.
We are grateful to the representatives of central and local authorities who supported us in collecting the relevant information, to those who testified in the case, as well as to the legal and technical experts; They have all created for us the opportunity to correctly present the facts before the arbitral tribunal. We are proud and happy that, after an arbitration that lasted almost 9 years, we were able to achieve, as a result of these huge team efforts, a result that prevented the citizens of Romania from bearing a budgetary burden of over USD 6 billion.
Dr. Heiskanen states, “Justice prevailed. This is for the many officials and civil servants in Romania, for their constant support and hard work, and for the people of Rosia Montana; We were honored to serve them.” It was indeed an honor, – adds Matthias Scherer a great satisfaction to see how Romania can now allocate its public funds to issues more sustainable and important than the USD 6 billion compensation demanded by a foreign investor.”
LALIVE and LDDP have previously won for Romania in five other foreign investment arbitrations, including Rompetrol v. Romania and Micula et al. v. Romania, in which claims of over €3 billion against Romania were rejected.
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