Noble Ventures, Inc. v. Romania
ICSID · Investment (ICSID and treaty) · Romania · 12 Oct 2005
Why it matters
This award is a landmark for its interpretation of the umbrella clause in a BIT, holding that it elevates contractual breaches to treaty breaches. It also clarified attribution of conduct by state-owned entities and set a high bar for proving expropriation where the investor retains control. The case is frequently cited in investment treaty arbitration.
Summary
Noble Ventures, a US company, acquired a Romanian steel mill (CSR) via a privatization agreement. Disputes arose over misrepresentations, failure to reschedule debts, labor unrest, and alleged expropriation. The tribunal found that the umbrella clause in the US-Romania BIT could transform contractual obligations into treaty obligations, but on the facts, Romania did not breach the contract. The claim for expropriation failed because Noble Ventures retained ownership and control. The tribunal dismissed all claims, with each party bearing its own costs.
The detail
Parties: Noble Ventures, Inc. v. Romania
Case number: ICSID Case No. ARB/01/11
Outcome: All claims dismissed. Each party bears its own costs and 50% of arbitration costs.
Applicable law: US-Romania Bilateral Investment Treaty (1992); ICSID Convention; Romanian law
Issues in play: Umbrella clause (Art. II(2)(c) BIT) vs. contract claims; attribution of acts of state entities to the state; fair and equitable treatment; expropriation.
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