Arbitration

Romania is a jurisdiction that promotes domestic and international arbitration, and to this end it is a signatory party to the most important international instruments dealing with arbitration. In 1961, by Decree No. 186, Romania became a contracting state to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. As of the date of that adherence, a declaration was made by Romania specifying that the Convention applies only to contractual or non-contractual disputes that are deemed commercial by Romanian legislation, and that it shall apply to arbitral awards issued in non-contracting states based only on reciprocity established by the state parties’ agreement.

Romania is also a state party to the European Convention on International Commercial Arbitration adopted by the United Nations in Geneva, on 21 April 1961, subsequently ratified by Decree No. 281 of 25 June 1963; also, Romania is party to the Washington Convention on the Settlement of Investment Disputes between States and Nationals of other States dated 18 March 1965, which was ratified by Decree No. 62, of 30 May 1975.

In conformity with article 11(2) of the Romanian Constitution, the treaties ratified by the Romanian parliament are part of domestic law.

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As of 2019, Romania is party to 97 bilateral investment treaties (BITs), of which 76 are still in force (https://investmentpolicy.unctad.org/international-investment-agreements/countries/174/romania?type=bits). Twenty-two BITs concluded in the past by Romania with EU member states were declared ceased or terminated by mutual agreement or by unilateral termination by the Romanian parliament, which approved such cease or termination through Law No. 18/2017, entered into force on 24 March 2017. The date when these BITs are to be ceased or terminated will be published in the Official Gazette by the Ministry of Foreign Affairs of Romania.

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The primary domestic sources of law related to domestic and foreign arbitral proceedings are contained in the New Civil Procedure Code (NCPC), in force since 15 February 2013, in Book IV entitled ‘About Arbitration’ (articles 541 to 621), dealing with domestic arbitration, and in Title IV entitled ‘The International Arbitration and the Effects of Foreign Awards’ (articles 1111 to 1133) of Book VII ruling on ‘The International Civil Proceedings’. The New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, to which Romania is a state party signatory and which is also part of Romanian law, applies to the recognition and enforcement of awards.

At the arbitration institutional level, the Court of International Commercial Arbitration attached to the National Chamber of Commerce and Industry of Romania (the Court of Arbitration) - the leading Romanian arbitration institution - has adopted its own rules on arbitral proceedings (the Rules of the Court of Arbitration); these rules, in their latest version in force since 1 January 2018, are aligned with the arbitration rules adopted by the most reputable international arbitration institutions worldwide.

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Domestic law on arbitration is represented in Book IV of the NCPC by articles 541 to 621, whereas international arbitration is regulated under articles 1111 to 1133 of the same (Book VII, Title IV). These modern and flexible provisions reflect attractive arbitration rules for both domestic and international arbitration. To a quite large extent, the provisions of the NCPC bear some resemblance to the UNICTRAL Model Law (eg, in the case of international arbitration, the arbitral tribunal can issue partial awards as long as a contrary provision is not included in the arbitration agreement; the recognition of the equal treatment of parties principle; and the ambit of the written form of an arbitration agreement). A difference from the UNCITRAL Model Law exists regarding the regime of interim measures and preliminary orders, namely that Romanian provisions do not contest the existence of the right to apply for such measures and orders. However, a detailed regime in this respect is not provided by the NCPC. At the institutional level, the current version in force of the Rules of the Court of Arbitration have more emphasis on this issue - they regulate the requests for the application of interim measures prior to the commencement of the arbitration procedure or before the case file is referred to the arbitral tribunal, where such requests shall be settled by an emergency arbitrator, as per article 40 of the mentioned institution rules.

However, there is nothing that prevents the parties from referring in their arbitration agreement to any of the provisions contained in the UNCITRAL Model law applying to their arbitration.

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The parties may not derogate from the rules regarding public policy or from the mandatory provisions of the law. Mandatory provisions from which the parties cannot deviate are, inter alia, the following:

• the clause by which a party nominates an arbitrator in lieu of the other party or by which it appoints a higher number of arbitrators than the other party is null and void;
• the parties are not entitled to waive their right to challenge the arbitral award by inserting a clause in respect thereof in the arbitration agreement; and
• the arbitration proceedings must ensure the equality of treatment, the right to defence and the audiatur et altera pars principle. Conversely, the award is subject to annulment.

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Romania is an EU member state, and as such the EU sources of law in connection with conflict of laws are to be scrutinised before referring to domestic provisions. The main EU sources of law are Regulation No. 593/2008 of the European Parliament and of the Council on the Law Applicable to Contractual Obligations (Rome I), and Regulation No. 864/2007 of the European Parliament and of the Council on the Law Applicable to Non-Contractual Obligations (Rome II). Where EU law is not applicable, the conflict of laws rules are mainly provided under articles 2557 to 2663 of the Romanian Civil Code - which entered into force on 1 October 2011. Both EU law and the Romanian Civil Code allow the parties to elect the governing law as the substantive law applying to the merits of an arbitration. The same applies in international arbitration under the Rules of the Court of Arbitration. Where the parties fail to elect the law governing the merits of dispute, both EU law and the Romanian Civil Code provide the rules for determining the substantive law.

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As per Law No. 335 of 3 December 2007, the most prominent permanent non-corporate arbitration institution is the Court of International Commercial Arbitration attached to Chamber of Commerce and Industry of Romania.

Court of International Commercial Arbitration

The Chamber of Commerce and Industry of Romania

2, Octavian Goga Blvd

3rd district

Bucharest

Romania

http://arbitration.ccir.ro/en

As the court of arbitration system is organised on a cameral basis, it follows that in each of the 41 administrative counties of Romania there is a chamber of commerce attached to which there is a court of arbitration. The rules of arbitration of these courts are almost identical to the NCPC (Book IV), which represents the Romanian arbitration law. However, in practice, the activity of these arbitration institutions is very limited, both as to registered cases and case law.

During the past decade, various bilateral private chambers of commerce created in Romania by the business community have established their own courts of arbitration, but their activity is still very limited as to their registered cases.

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As regards international arbitration, the NCPC states that any dispute of an economic nature can be submitted to arbitration if it concerns rights in relation to which the parties can freely dispose, and provided that the law of the state where the arbitral tribunal has its seat does not reserve exclusive jurisdiction for the national courts. In principle, only monetary claims can be referred to either domestic or international arbitration. However, there are some monetary claims that are excluded from arbitration. For instance:

• intellectual property disputes concerning the annulment of a trademark, a patent or industrial designs, or those related to the author of a creation subject to copyright, where such disputes are given in the exclusive competence of the courts of law;
• regarding antitrust and competition laws matters, the disputes on the lawfulness of the Competition Council’s decisions are reserved to the court of law. However, the parties may refer to an arbitration dispute with claims on damages arising from a breach of competition law; or, in the case of a contractual dispute, one party may raise competition issues in connection with the validity of some clauses and the arbitral tribunal will retain jurisdiction to assess such matter;
• intracompany (corporate law) disputes are reserved to the courts of law as per the provisions of Law No. 31/1990 on Companies; and
• family matters, inheritance disputes and any matters related to the civil status are also given to the jurisdiction of courts of law.

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As a general rule, the arbitration agreement must be concluded in writing. The criteria for determining whether the arbitration agreement was executed in writing are very generous, being considered to be fulfilled if the parties agreed to arbitration by means of an exchange of correspondence, irrespective of its form, or by an exchange of procedural acts, as well as if the defendant expressly accepts the jurisdiction of the arbitral tribunal, either by written statement or by express statement recorded by the arbitral tribunal. As an exception, the NCPC (article 548) compels the parties to conclude the arbitration agreement in an authentic form, under the sanction of absolute nullity, if it refers to disputes related to the transfer of an ownership right or to the creation of another property right over an immovable property.

Under the NCPC (article 550(1)), the arbitration agreement must include a reference regarding the procedure to appoint the arbitrators, under the express sanction of nullity. In the case of institutional arbitration, such references are not mandatory, considering that the law allows a reference to the procedural norms of the institution that administers the arbitration. Arbitration agreements must be concluded with the observance of the conditions provided for the validity of agreements in general, namely the existence of the capacity of the parties to conclude the agreement; the parties’ consent; and a valid object and a valid cause of the main contract. Local or state entities can conclude an arbitration agreement to the extent that a special provision - either domestic or international - allows them to do so.

The Court of Arbitration drafted a model clause for the arbitration agreement to be used by any concerned parties. This model clause only refers to disputes that arise from the agreement containing an arbitration clause or by a separate agreement (referred to as a compromise). The Rules of the Court of Arbitration provide for the principle of separability of an arbitration agreement from the main contract and its full effects regarding the competence of the arbitral tribunal (except for the cases when the matter in dispute is not arbitrable).

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According to Romanian law - NCPC (article 554) and article 6 of the European Convention on Human Rights - an arbitration agreement is no longer enforceable for the following reasons:

• the institution organising the arbitration fails to comply with the minimum requirements of article 6 of the European Convention on Human Rights;
• the arbitral tribunal cannot be constituted because of the defendant’s obvious default; or
• the proceedings before courts of law were initiated and the defendant raised no objection on jurisdiction.

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Provisions on the separability of arbitration agreements from the main agreement are found in the case of domestic arbitration - article 550 (2) NCPC (‘The validity of the arbitration clause is independent of the validity of the contract that was entered’) and the case of international arbitration - article 1113 (3) NCPC (‘The validity of the arbitration agreement cannot be challenged on the grounds of the invalidity of the main contract or because it would concern a dispute that does not yet exist’).

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A third party can be bound by an arbitration agreement only to the extent that it is a party to that arbitration agreement. In several cases, parties different from the signatories may be bound by an arbitration agreement if:

• the underlying contract was assigned to a third party in accordance with the rules set out in the NCPC;
• the assignee of a claim is bound by the arbitration agreement by virtue of the accessorium principali sequitur rule; or
• in the case of inheritance, the heirs and legatees of a party contracting to an arbitration agreement are bound by such a clause.

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According to the NCPC, if third parties are to participate in arbitration, this must be based both on the consent of the third parties and of all the parties to arbitration, with the observance of the general rules governing third-party participation in disputes. According to these general rules, any person who has a substantive interest can intervene in a dispute pending between other parties. Where a third party intends to intervene for the benefit of one of the original parties, such intervention is allowed without the existence of the consent of the original parties.

The Rules of the Court of Arbitration have a different perspective on third-party participation in arbitration, regulated in article 16. First, if the third party intends to intervene solely for the benefit of one of the original parties, it must prove the existence of an arbitration agreement with all the original parties or obtain their consent. Second, where a third party that may have the same claims as the original claimant intends to intervene in an ongoing proceeding or one of the original parties requests for the joinder of the third party, this implies the authorisation of the arbitral tribunal or, where such tribunal is yet to be appointed, by the board of the Court of Arbitration.

When deciding on whether to authorise such intervention, the arbitral tribunal or the board shall also take into account, inter alia, the fulfilment of the following conditions:

• all parties, including the intervenor, agree, even before the arbitral tribunal, that the disputes between them are subject to arbitration conducted in accordance with the Rules of the Court of Arbitration and also on the method of choosing the arbitral tribunal;
• the intervention from the third party or the request for joinder have been filed in a timely fashion - at the latest at the first hearing date; and
• the intervening third party or the request for joinder party pays the arbitration fee in the amount established by the Schedules of Arbitral Fees and Expenses part of the Rules of the Court of Arbitration, as well as any additional arbitration costs.

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Arbitral tribunals are not often confronted with the group of companies doctrine in view of extending an arbitration agreement to non-signatory companies, and therefore, to the best of our knowledge, the group of companies doctrine is not recognised yet in the Romanian jurisdiction.

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Romanian law is silent as far as this specific matter is concerned. There is an opinion that the requirements for executing an arbitration agreement remain applicable for such cases as well (see question 9).

The Rules of the Court of Arbitration deal with this matter in connection with the nomination of arbitrators by providing that if there are more claimants or defendants, the parties having mutual interests will designate one arbitrator. If the parties fail to agree on this appointment, the arbitrator will be designated by the president of the Court of Arbitration.

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The NCPC is silent in connection with the consolidation of separate arbitral proceedings. The Rules of the Court of Arbitration attached to the Chamber of Commerce and Industry of Romania deal with this matter under article 17, which provides for three circumstances in which the Arbitral Tribunal may decide to consolidate separate arbitral proceedings:

• all the parties agree to the consolidation;
• all the claims are made under the same arbitration agreement; or
• where the claims are made under more than one arbitration agreement, the relief sought arises from the same transaction or series of transactions and the arbitral tribunal considers the arbitration agreement to be compatible.

In deciding on consolidation, the arbitral tribunal shall consult with the parties and may have regard to, inter alia, the stage of the pending arbitration, whether the arbitrations raise common legal or factual issues, and the efficiency and expeditiousness of the proceedings.

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The general rules set out in article 555 of the NCPC provide that any natural person who has an unrestricted exercise of its rights can be an arbitrator. The Rules on the Organization and Operation of the Court of Arbitration provide that any person - whether a Romanian or a foreign national - can be an arbitrator, if he or she has an unrestricted exercise of his or her rights, enjoys an excellent reputation and is highly qualified in the field of international private law, internal and international economic relations and commercial arbitration. The Court of Arbitration provides a list of selected arbitrators considered to have such qualifications.

To be included in the list of arbitrators, a person must, among other things, have a solid legal background and at least eight years’ experience in the legal field. In case of arbitrations organised by the Court of Arbitration, persons who are not included on the list of arbitrators can act as arbitrators if the parties in dispute nominate these persons by their arbitration agreement, regarding a specific dispute, under the condition that these persons meet the requirements set forth by the arbitration Rules of the Court of Arbitration. A restriction to act as arbitrator exists for acting judges.

The NCPC, as well as the Rules of the Court of Arbitration, provide that an arbitrator cannot solve a specified arbitral dispute if he or she does not observe the qualification requirements or other conditions regarding arbitrators, which are set forth in the arbitration agreement. The law is silent on what concerns the possibility of accepting contractual requirements for arbitrators based on nationality, religion or gender.

To our knowledge, no criteria other than those specified by the law and the specified arbitral rules apply to the selection of an arbitrator.

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As a general rule, any person enjoying the full capacity of his or her rights may act as an arbitrator. The Rules on the Organization and Operation of the Court of Arbitration provide under article 4(4) that any Romanian or foreign citizen may act as an arbitrator where he or she enjoys the full capacity of rights, does not have a bad reputation, and has considerable skills and experience in the field of private law, domestic and international economic relations, and commercial arbitration.

Persons holding certain official positions within Romania are prevented from sitting as arbitrators. For example, acting judges or prosecutors cannot act as arbitrators.

Practising lawyers and law professors are regularly appointed as arbitrators in the Romanian jurisdiction. Retired judges may also be found on the panels of arbitral tribunals.

As far as gender diversity in institutional appointments is concerned, we do not know of any initiatives to promote gender diversity. In practice, the majority of arbitrators are male.

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Under the rules of the NCPC, the names, number and appointment mechanism of arbitrators must be indicated in the arbitration agreement. The parties are free to agree on these aspects subsequent to the execution of the arbitration agreement. The powers of the domestic court or of the president of the Court of Arbitration to make the nomination are subsidiary to the freedom of the parties to make an agreement.

The domestic courts may intervene in the mechanism for the appointment of arbitrators if a party fails to propose the arbitrators; the parties disagree on the appointments of the sole arbitrator; or the arbitrators disagree on the nomination of the chair.

In the case of arbitration under the Rules of the Court of Arbitration, the default mechanism is different as the president of the Court is empowered in case of default to appoint the arbitrators, the sole arbitrator or the chair.

The president of the Court, when making the appointment in case of default, shall consider the nature and the circumstances of the dispute, the substantial applicable law, and the seat and language of the arbitration, as well as the nationality of the parties.

Not least, the filing of an ancillary claim or incidental request shall not result in the modification of the composition of an already constituted arbitral tribunal.

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The NCPC provides that arbitrators can be challenged both for the same grounds as judges and, additionally, for specific grounds such as:

• failure to meet the professional requirements or other requirements set out in the arbitration agreement;
• a legal person having an interest in the arbitration dispute, where the legal person has the arbitrator as shareholder or involved in its management;
• where the arbitrator is working for or in direct commercial relations with one of the parties, a company controlled by one of the parties or under joint control; and
• where they provided consultancy to one of the parties, assisted one of the parties or testified in the previous stages of the dispute.

Domestic courts have jurisdiction in hearing the merits of the challenge request with the attendance of the parties and of the challenged arbitrator.

In arbitrations organised under the Rules of the Court of Arbitration, an arbitrator can be challenged on grounds that question his or her independence and impartiality, and that qualify the arbitrators as incompatible. The grounds for challenge are similar to those provided in the NCPC. The challenge request is settled by an arbitral tribunal appointed by the president of the Court of Arbitration or, in case of a sole arbitrator, by the president of Court of Arbitration or by another arbitrator appointed by the president of the Court of Arbitration.

In the particular case of bias or an appearance of bias, an arbitrator can be challenged by the concerned party. The standard of bias or appearance of bias that might give grounds for challenging an arbitrator is the same as in the case of judges as developed by the case law of the courts of law, which takes guidance from the judgments of the European Court of Human Rights. In some disputes, guidance is also sought from the IBA Guidelines on Conflicts of Interest in International Arbitration.

The replacement of an arbitrator may occur in the case of challenge, withdrawal, resignation (because of illness, for example), death or other impediments.

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Arbitrators are, as a general rule, appointed by the parties. Failing the nomination by the parties, the arbitrators are to be appointed by the domestic court or by the president of the Court of Arbitration.

Arbitrators are entitled to receive fees for their duties. Under the Rules of the Court of Arbitration the fees of the arbitrators are included in the arbitration tax, calculated by the secretariat of the Court of Arbitration. Any arbitrators’ expenses occurring during the pending dispute are borne by the parties.

In the case of ad hoc arbitration, the arbitral tribunal shall determine the due fees and may compel the parties to pay them in advance and, with regard to the expenses occurred during the dispute, the arbitral tribunal shall assess whether all parties will bear those expenses.

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The person nominated or appointed as arbitrator is compelled under the provisions of article 562 (3) NCPC to disclose to the parties and to the other arbitrators, before any acceptance of the mission or, if after, as soon as he or she becomes aware of, any grounds substantiating a potential challenge against his or her impartiality or independence.

Under the Rules of the Court of Arbitration (article 21) the person nominated as arbitrator is under a duty to provide, within five days as of the date of receiving the nomination, a statement on their independence, impartiality and availability, simultaneously disclosing any circumstances that may cast any reasonable doubts on his or her independence or impartiality. Where such circumstances occur after the acceptance of his or her nomination, the arbitrator is under duty to immediately disclose them to the parties and to the other arbitrators.

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The NCPC provides for cases where the arbitrators are to be held liable to the parties, such as:

• after acceptance, the arbitrator waives the appointment in an unjustified manner;
• for groundless reasons, the arbitrator fails to attend the arbitral dispute proceedings, performs other actions that are of such a nature as to unjustifiably delay the proceedings or fails to deliver the award by the deadline as set out in the arbitration agreement or by the law; and
• the arbitrators fail to observe the confidentiality of the arbitration by publishing or disclosing information known in the capacity as arbitrators, without the parties’ prior authorisation.

Under the Rules of the Court of Arbitration, the arbitrators shall not be liable to any of the parties for any action or omission in connection with the arbitration, unless such action or omission is owing to their wilful misconduct or gross negligence.

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There might be situations where, in spite of an existing arbitration agreement, a party initiates court proceedings. In such a case, only the parties may challenge the court’s jurisdiction on grounds of the existing arbitration agreement. Where the jurisdiction is challenged on grounds of an existing arbitration agreement, the court shall retain jurisdiction if the defendant’s arguments on the merits of the dispute have no reservation on grounds of the arbitration agreement; the arbitration agreement is affected by nullity or is not inoperative; and the arbitral tribunal cannot be constituted for reasons utterly determined by the defendant. In international proceedings, any challenge of jurisdiction based on the existing arbitration agreement needs to be raised by the defendant until at the first hearing, provided that the subpoena was duly served.

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The arbitral tribunal verifies its jurisdiction either ex officio or at a party’s request, and delivers a decision in this respect (based on the competence-competence principle). In domestic arbitration, at the first hearing, provided that the subpoena was duly served, the arbitral tribunal verifies its jurisdiction. Where jurisdiction is retained, the concerned party may challenge such a decision only by means of a motion to set aside the award itself. If the arbitral tribunal declares that it does not have jurisdiction, its competence is declined in favour of the court of law and such decision of the tribunal cannot be challenged with a motion for setting aside the award.

In international arbitration, any objection of jurisdiction must be raised prior to any defence on the merits of the dispute. The arbitral tribunal decides on its own jurisdiction without taking into account other pending claims before another arbitral tribunal or court, between the same parties and having the same object, except when grounded reasons require the stay of the proceedings.

Under the Rules of the Court of Arbitration, at the first hearing the parties are called to answer to the arbitral tribunal the extent to which they have objections to its jurisdiction.

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In domestic and international arbitration, the NCPC standard provides that, if the parties fail to reach an agreement, the arbitral tribunal has residual jurisdiction in determining the place of arbitration. In the case of institutional arbitration, under the Rules of the Court of Arbitration, the place of arbitration is at the Court’s headquarters, unless the parties have agreed otherwise.

As far as the language of arbitration proceedings is concerned, where no agreement is reached, the language of the substantive contract is considered to apply or any international language as to be determined by the arbitral tribunal. In an institutional arbitration under the Rules of the Court of Arbitration, unless the parties agreed the contrary, the language of arbitration is Romanian. Upon request by a party, the arbitral tribunal, taking into consideration the circumstances of the case, may decide to conduct the proceedings in another language.

In international arbitration, article 1120 NCPC provides that the Arbitral Tribunal applies the substantive law chosen by the parties and, failing such choice, the law the Arbitral Tribunal deems to be adequate, taking always into account customs and any professional rules.

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Arbitral proceedings are initiated by the claimant by submitting a request for arbitration. The request must be made in writing and must contain the identification data of the parties and of their representatives, the reliefs sought and the monetary value of the claim, the factual and legal merits of the case, the supporting evidence, the arbitration agreement with a copy of the corresponding contract, the signature and the stamp of the parties, as the case may be.

The request must be submitted in a number of copies sufficient to be communicated to each and every party and for each of the members of the arbitral tribunal.

Under the Rules of the Court of Arbitration, the request for arbitration must be submitted in paper and electronic format, in as many counterparts as the number of defendants, for each of the arbitrators and an additional one for the arbitration file. The request for arbitration should also contain the claimant’s proposal concerning the number of arbitrators, the name of the proposed arbitrator, the place of arbitration and its option with respect to the incidence of the expedited arbitration procedure. The term of arbitration starts from the date when the arbitrator accepted his or her appointment (or as of the date when the chair accepted his or her appointment) by giving a written declaration of acceptance.

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According to the rules of the NCPC, the arbitral tribunal normally at least organises a hearing for the parties’ debates, based on the general principle of procedural law, which states that disputes shall be debated orally. The parties can attend such a hearing personally, represented by their attorneys or assisted by any person. Nonetheless, any of the parties can require in writing that the settlement of the dispute be made in its absence, on the basis of the evidence in the file.

The Rules of the Court of Arbitration contain provisions about hearings, article 35 regulating that hearings shall be organised if requested by a party or if the arbitral tribunal finds it appropriate. The parties can attend such a hearing personally or be represented by their attorneys, counsel or by any other person and be assisted by interpreters. Where the Special Rules for Expedited Procedure are applicable, according to article 3(4) thereof, the hearings may be conducted by video conference, telephone or by any similar means of communication.

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First, each party must prove the facts in connection with its claims or defences. The evidence the parties may provide in connection with their claims or defences is prescribed by the general law, namely the NCPC (witnesses, experts, documents, inspection by the arbitral tribunal and cross-examination). In addition, the parties and their representatives may be subject to examination. Before the arbitral tribunal, the experts and the witnesses are not cross-examined under oath.

Domestic law does not prevent the parties from agreeing upon the evidence and upon their administration before the arbitral tribunal.

In institutional arbitration under the Rules of the Court of Arbitration, there are some peculiarities. First, according to article 31 of the Rules of the Court of Arbitration, which regulates the case management conference, after the referral of the case to the arbitral tribunal, it shall make an order giving notice to the parties for the case management conference, aimed to organise, schedule and establish the applicable procedural rules, including with respect to evidence, and the stages for filing the written submissions, subject to the application of article 26(5). Second, the parties may submit written statements from the witnesses and, in what concerns the experts, prior to or at the latest during the case management conference, the parties have the obligation to inform the arbitral tribunal whether they choose the appointment of an independent expert or intend to file expert reports prepared by party-appointed experts. After consulting the parties, the arbitral tribunal may appoint one or several experts who shall submit their reports in the case file, accompanied by proof of communication to the parties. In such a situation, each party has the right to appoint a side expert to attend the work of the appointed experts.

Upon the parties’ agreement, the arbitral tribunal, on grounds of article 34(5) of the Rules of the Court of Arbitration, may apply IBA Rules on the Taking of Evidence.

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Domestic courts may intervene, upon the request of a party, to remove the obstacles in commencing or deploying the arbitration proceedings or for performing other powers that fall under the court’s competence. For instance, the court intervenes in the following situations:

• the arbitral tribunal cannot be constituted, in case of ad hoc arbitration;
• before or during arbitration proceedings, the court, by request, is asked to take interim or provisional measures;
• a party opposes the interim measures taken by the arbitral tribunal during arbitration proceedings; and
• to apply sanctions to the expert or to the witnesses, or if a public authority fails to respond to an information request received from the arbitral tribunal.

The referral to the court shall be settled in an emergency procedure and the judgment is not subject to any appeal.

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The arbitral file and the proceedings are confidential, and the arbitrators and all the staff of the Court of Arbitration are bound by the obligation of confidentiality. The complete award can only be published with the parties’ approval. The enforcement file is also confidential, but certain proceedings must be made publicly.

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Regarding the legal provisions of NCPC, article 585 provides that before or during the arbitration, either party may request the tribunal to take interim measures and provisional measures on the subject matter of the dispute or to ascertain certain factual circumstances. The approval of these measures will be brought to the knowledge of the arbitral tribunal by the party requesting them. During the arbitration, interim measures and provisional measures, as well as the observance of certain factual circumstances, may also be approved by the arbitral tribunal. In the case of opposition, the enforcement of these measures is ordered by the court.

Also, in the international arbitration section, the NCPC provides that the arbitral tribunal may order provisional or interim measures at the request of one of the parties, unless stated otherwise in the arbitration agreement. In addition, if the party concerned does not voluntarily execute the ordered measures, the arbitral tribunal may request the intervention of the competent court, which applies its own law. The judge or arbitrator may request the payment of an appropriate bail for the provision of interim or conservative measures.

Regarding the Rules of the Court of Arbitration, article 40 provides that before the initiation of the arbitration proceedings the arbitral tribunal may, upon request by a party and by means of a procedural order rendered under an expedited regime, grant any interim or conservatory measures that it deems appropriate. The arbitral tribunal may order the party requesting an interim or conservatory measure to provide the necessary security (deposit) in connection with the measure requested. Any requests for interim or conservatory measures filed before the initiation of the arbitration or before the case file was referred to the arbitral tribunal shall be decided by an emergency arbitrator.

During the arbitral proceedings, such measures can be ordered by either the arbitral tribunal or by the court of law. If a party opposes the measures taken by the arbitral tribunal, the enforcement shall be conducted by the court of law.

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As at the time of writing, the Rules of the Court of Arbitration provide that requests for interim or conservatory measures filed before the initiation of the arbitration or before the case file was referred to the arbitral tribunal shall be decided by an emergency arbitrator in accordance with the procedure set forth in Annex II of the these rules.

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A constituted arbitral tribunal may order conservatory and interim measures related to the dispute matter, or measures regarding the finding of the facts. The enforcement of such measures can be assured with the assistance of the courts of law.

As stated in question 32, the arbitral tribunal may decide on measures regarding the conservation of evidence, seizure over opposing parties’ assets or over the assets in dispute. In domestic arbitration and in certain situations, such measures are conditioned upon presenting a bail by the requesting party.

In international arbitration, as per the NCPC, it is stated that the arbitral tribunal may order interim measures, unless the contrary is stated in the arbitration agreement. If not, the arbitrator may condition the measure upon presenting a bail by the requesting party. The purpose of the bail is to secure the possible damages the party might incur from ordering the interim measures.

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Under both the NCPC and the Rules of the Court of Arbitration, the arbitral tribunal has no power to order sanctions against the parties or their counsel where it deems that guerrilla tactics were used. Nevertheless, nothing prevents the arbitral tribunal from recording into the minutes the guerrilla tactics used by the parties or their counsel and for the concerned party to follow and rely on the provisions set forth by article 547 of the NCPC, to eliminate the procedural difficulties created in such circumstances with the court support. As far as the second question is concerned, under no circumstances may the arbitral tribunal or domestic arbitral institution sanction the counsel. If the procedural rules or the professional ethics were violated, the party concerned may resort to the provision of article 547 and ask the ordinary courts to eliminate the difficulties created in such circumstances, or they may refer the situation to the professional organisation to which the counsel belongs, which may trigger the disciplinary liability of the counsel.

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Under both the rules of the NCPC - primarily article 602(3) - and of the Rules of the Court of Arbitration, article 45(4), awards can be issued by the majority of the arbitral tribunal members. Unanimity is not required. Dissenting opinions are accepted.

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The arbitrator that has a dissenting opinion must prepare and sign a separate opinion, attached to the arbitration award (as per article 603(23) of the NCPC and per article 45(5) of the Rules of the Court of Arbitration). Concurrent opinions are also provided by the same rules.

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The award is issued in writing and, pursuant to article 603 of NCPC, must contain the following information:

• the names of the arbitrators and of the arbitral assistant (if applicable), and the place and the delivery date of the award;
• the names of the parties, their domicile or residence or, as the case may be, their denomination and headquarters, the name of the representatives, as well as other parties attending the debates;
• the arbitration agreement;
• the dispute and the parties’ arguments;
• the de facto and de jure reasons of the award, and in case of ex aequo et bono arbitration, the reasons that support the conclusion of the arbitral tribunal;
• the court decision (disposition); and
• the signatures of all arbitrators, with the observance of article 602(3) of the NCPC regarding the majority rule, and, if applicable, the signature of the arbitral assistant.

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Under the Rules of the Arbitration Court, unless the parties have agreed otherwise, the award shall be issued no later than six months from the date on which the arbitral tribunal has been constituted. The parties may agree at any time during the arbitration to extend the term of the arbitration, by either written or oral statement, made before the arbitral tribunal and recorded in a procedural order. The arbitral tribunal may order, by way of a procedural order, the extension of the term of the arbitration, if it finds that a party obstructs the conduct of the arbitration or for other justified reasons. The term shall be automatically extended by three months where the legal personality of a party ceases to exist or in the case of the death of one of the parties.

The award shall be made in writing within a term of a maximum of one month from the date of closing of the proceedings or, upon circumstances of the case, from the date of the filing of the post-hearing submissions or, where applicable, within the time limit agreed upon with the parties. The president of the Court of Arbitration may extend the time limit for making and drafting the award on the basis of a reasoned request from the arbitral tribunal. Caducity (time-bar effect) can be claimed if requested in due time in conformity with the Rules of the Court of Arbitration. As far as the NCPC is concerned, article 605 provides that the arbitral award, setting out its reasoning, shall be served to the parties within one month from when it was delivered.

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The date of the award is the date when the arbitral tribunal delivers the award, and such date is decisive for the following:

• the time limit under which the arbitral tribunal must render the award; and
• whether the award was delivered with the observance of the deadline set out by the NCPC or of the Rules of the Court of Arbitration.

The date of the service of the award stating the reasons is decisive for the following:

• one or three months, as the case may be, for the motion to set aside the arbitral award;
• the referral for the correction of clerical errors or for the interpretation or completion of the award. The time limit is 15 days under the NCPC and 15 days under the Rules of the Court of Arbitration; and
• the award is to be deemed final and binding as of the date of its service.

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The arbitral tribunal may issue final, interim or partial awards based solely upon the relief sought by the parties in dispute. In domestic arbitration, partial awards may be delivered to the extent that a party acquiesces to the other party’s claims. In international arbitration based on the Romanian law of arbitration, article 1.121(4) of the NCPC provides that the arbitral tribunal may issue partial awards, unless the arbitration agreement states the contrary.

As far as interim awards are concerned, these can be delivered according to the criteria stated under question 34.

The arbitral tribunal may only grant the reliefs sought by the parties in dispute, provided that such relief is lawful, possible and at least determinable.

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From the provisions of the NCPC it results that arbitral proceedings can be terminated by:

• the settlement of the parties, formalised in writing;
• the caducity of the arbitration (time-bared) raised in due time by the concerned party; and
• waiver of the parties to the disputed claims, which must be formalised in a written statement or recorded by the arbitral tribunal.

In addition, for arbitration under the Rules of the Court of Arbitration, arbitration proceedings can be terminated in the case of lapse of proceedings or in the case of claimants’ default to comply with the duties indicated by the arbitral tribunal.

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The costs of arbitral proceedings are allocated according to the parties’ agreement or, failing such, the losing party will bear its own costs and will be compelled to pay the costs of the winning party in as much as the latter’s claims were admitted.

The costs of arbitral proceedings include the registration fee, the administrative fee, costs for the taking of evidence, translation costs, hearing costs, and fees of the arbitrators, attorneys, counsels, parties, arbitrators and witnesses, as well as experts’ costs with travelling expenses and other expenses in connection with the arbitration proceedings.

Unless otherwise established by the parties, the arbitral tribunal, upon request by a party, shall order in the award the payment by one of the parties of any reasonable costs incurred by the other party, including the costs related to representation before the arbitral tribunal, taking into consideration the result of arbitration, the manner in which each party contributed to ensuring the efficiency and expeditiousness of the proceedings and any other relevant circumstances.

In international arbitration, pursuant to article 1122 of the NCPC, unless stated to the contrary, the arbitrator’s fees and his or her travelling costs are incurred by the parties who appointed him or her. In the case of a sole arbitrator or of the chair, the costs are allocated equally between the parties.

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The arbitral tribunal may award interest for principal claims and for costs. The interest rate shall be that established by the parties or, failing that, pursuant to the government’s Ordinance No. 13/2011 on the return and default interest rate. The interest rate for monetary obligations payable in Romanian currency is established based on the monetary policy interest rate published by the National Bank of Romania.

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The award can be corrected ex officio or upon the request of the parties, whereas the interpretation may be decided only based on parties’ request. In the case of arbitration under the NCPC, article 604 provides that the concerned party may submit a claim for the correction of clerical errors, for interpretation or for completion within 10 days of the service date.

In the case of arbitration under the Rules of the Court of Arbitration, errors or omissions with respect to the name, capacity and arguments of the parties or calculation errors or omissions, as well as any other clerical errors in the award or in the procedural orders can be corrected by the motion of the tribunal or following a request by a party, to be filed within 15 days from the date of communication of the award. Within 15 days from the service date the parties may submit motion for interpretation or for the completion of an arbitral award.

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Pursuant to article 608 of the NCPC, an award can be challenged only by means of a motion for setting aside on the following grounds:

• the dispute was not subject to arbitration;
• the arbitral tribunal settled the dispute without any arbitration agreement or the arbitration agreement was null and void or not enforceable;
• the arbitral tribunal was constituted with the non-observance of the arbitration agreement;
• the party was not present at the debate hearing and the service was unlawfully made;
• at least one party announced its interest in raising the caducity, the award was delivered after the expiry of the caducity term set out in article 567 of the NCPC and the parties did not agree on continuing the proceeding pursuant to article 568(1) and (2) of the NCPC;
• the arbitral tribunal settled the dispute extra petita or ultra petita;
• the award does not contain the operative part (the court decision) and its reasoning, indicate the date and the place of delivering, or contain the signatures of the arbitrators;
• the award infringes public policy, morals and the mandatory provisions of the law; and
• if, after delivering the award, the Constitutional Court issued a judgment on the plea raised in the file, stating the non-constitutionality of the law, the ordinance or the provision from a law or an ordinance that forms the object of the plea or of other provisions from the contested enactment is not to be dissociated from the provisions indicated in the referral to send the plea to the Constitutional Court.

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The decision on a motion to set aside an arbitral award can only be challenged by an appeal on points of law. For the motion to set aside the judgment, the judicial stamp tax is established based on the value of claims. The appeal on points of law is subject to judicial stamp tax evaluated depending on the indicated ground of appeal, pursuant to Government Emergency Ordinance No. 80/2013 on the judicial stamp tax.

The period for deciding on a motion to set aside the judgment may vary between six months and two years for each level.

Costs are generally represented by the judicial stamp tax, as the case may be, and by the fees of the attorney.

According to the NCPC, the costs are borne by the losing party, but the court retains the liberty to decide whether the costs are to be entirely reimbursed to the winning party.

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First, to have the awards enforced, leave by the court must be provided based on an application by the concerned party pursuant to article 1126 of the NCPC. The party may follow the provisions of either the New York Convention or the NCPC.

Second, the principle enshrined in article 1125 of the NCPC is that any foreign arbitral award may be recognised and enforced in Romania insofar as the dispute may be subject to arbitration in Romania, and as long as the award has no provision inconsistent with Romanian public policy. Failure to comply with the two requirements implies a refusal to enforce the award.

Third, as far as other impediments to enforcement are concerned, the NCPC of Romania provides under article 1129 for the following cases when the enforcement of a foreign arbitral award may be hindered:

• the parties were unable to conclude the arbitration agreement, according to their own law, established pursuant to the law of the state where the award was rendered;
• the arbitration agreement was void pursuant to the law elected by the parties or, failing such election, pursuant to the law of the state where the award was rendered;
• the party against which the award is enforced was not duly informed on the appointment of the arbitrators or on the arbitration proceedings, or it was unable to defend in arbitral dispute;
• the appointment of the arbitral tribunal or the arbitration proceedings violated the convention of the parties or, failing such convention, the law of the place of arbitration;
• the award deals with a dispute not provided by the arbitration convention or outside the limit set out by such convention or comprises provisions exceeding the terms of the arbitral convention. However, as long as the provisions from the award dealing with the aspects subject to arbitration may be separated from those regarding aspects not subject to arbitration, the former are to be recognised and enforced; or
• the award is not yet binding on the parties, or it was set aside or stayed by a competent authority from the state where or pursuant to which it was rendered.

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The first principle under Romanian law is that arbitral awards are voluntarily enforced by the parties. The second principle is that arbitral awards are to be enforced in the same manner as a court of law judgment where the party in default fails to comply with the award. The third principle is that under the article 706 of the NCPC, the right to ask and obtain the enforcement of an award is subject to a statute of limitation. The statute of limitation is of three years in case of obligations and of 10 years in case of property rights.

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An award set aside by a court at the place of arbitration cannot be enforced on Romanian territory.

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There are no provisions contained in the NCPC in connection with the appointment of an emergency arbitrator.

In accordance with Annex II of the Rules of the Court of Arbitration, a party may apply for the appointment of an emergency arbitrator for interim or conservatory measures requested, and the powers of such arbitrator terminate on the date when the arbitral tribunal is constituted. Within two days from its appointment, the emergency arbitrator shall establish an interim procedural timetable and decide with respect to the need to provide a security deposit, as well as with respect to the period in which the party against which the interim or conservatory measure is sought may submit its answer to the request. Any procedural order with respect to the interim or conservatory measures shall be issued no later than 10 days from the date when the appointment was communicated to the emergency arbitrator. The president of the Court of Arbitration may extend this period upon a reasoned request of the emergency arbitrator. A procedural order shall be binding upon the parties when rendered. Upon a reasoned request of a party, the emergency arbitrator may amend or revoke the procedural order. By agreeing to arbitration under the Rules, the parties undertake to immediately comply with any procedural orders regarding the interim or conservatory measures ordered by the emergency arbitrator. Where a party fails to comply with the procedural order regarding the interim or conservatory measures, the concerned party may resort to the domestic courts to obtain a judgment enforceable with the aid of a bailiff.

Article 9(5) of Annex II of the Rules of the Court of Arbitration provides that the arbitral tribunal is not bound by the procedural order or by the reasons held by an emergency arbitrator, and may amend or cancel the interim or conservatory measures taken by such arbitrator.

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In enforcing awards, the concerned party may incur, inter alia, the following costs:

• costs of the attorneys;
• fees of the bailiff;
• judicial stamp tax for enforcing the award provided by Government Emergency Ordinance No. 80/2013; and
• other costs that might occur in the case of challenging the enforcement procedure.

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Generally, in the Romanian judicial system proceedings are conducted either by a judge, in front of courts of law or by an arbitrator in arbitration proceedings, as the case may be. In practice, the judges strongly emphasise the procedural rules, with the result that written witness statements are not common practice in proceedings and that a party in dispute may be subject to examination, but without the possibility of testifying as witness. As far as the arbitration under the Rules of the Court of Arbitration is concerned, the procedural rules are more flexible and allow the parties to bring written witness statements in their support.

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A counsel is subject to the rules enacted by the bar to which it adheres. In Romania, counsels are members of one of the bars composing the National Union of Lawyers. The rules for counsel are comprised in the statute on the lawyer profession issued by this union. With regard to the fact that the National Union of Lawyers is a full member of the Council of Bars and Law Societies of Europe, it adopted the Code of Conduct as its own code of professional conduct. Such rules are not specific professional or ethical rules applicable only in the case of international arbitration, but rather general rules on the relationship of the counsel to the client, to the magistrate and to other counsel. The rules on relations to the magistrates also apply in the relations to the arbitrators.

In the section of the NCPC dealing with international arbitration (see question 3) there are no references to any professional or ethical rules applicable to the arbitrators.

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Arbitration costs are regulated under articles 595-600 of the NCPC, where there is no reference related to third-party funding of arbitral or non-arbitral claims. Nevertheless, this should not be translated into a de plano prohibition of third-party funding of arbitral claims (eg, there is nothing preventing the parties from including into the arbitration agreement clauses related to third-party funding). Also, as per article 620 of the NCPC, in institutional arbitration, the arbitration costs are awarded according to the rules of the arbitration institution. As at the time of writing, the Rules of the Court of Arbitration list some of the most usual arbitration costs incurred by the parties, such as arbitration and arbitrators’ fees and counsels and experts’ fees, but they also make reference to any legal costs incurred by the parties. In the authors’ opinion, the extent to which third-party funding costs fall under the ambit of other legal costs is a matter to be decided by the arbitral tribunal on a case-by-case basis.

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Romania is a member state of the European Union and, accordingly, the provisions related to visas and work permits are those indicated by the European legislation transposed into Romanian national law. Attorneys from EU member states are also subject to the special regulations enacted in this respect. Attorneys from EU member states may represent and assist the parties in arbitration.

Lawyers or consultants from third-party states may require residence permits and must adhere to visa requirements, following the formalities of the National Bar Association or other relevant professional bodies, and are subject to taxes imposed by the National Bar Association and by the tax authority for the performed activity. Activities of the lawyers and arbitrators undertaken on Romanian territory are subject to value added tax rules.

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Legislative reform and investment treaty arbitration

57 Are there any emerging trends or hot topics in arbitration in your country? Is the arbitration law of your jurisdiction currently the subject of legislative reform? Are the rules of the domestic arbitration institutions mentioned above currently being revised? Have any bilateral investment treaties recently been terminated? If so, which ones? Is there any intention to terminate any of these bilateral investment treaties? If so, which ones? What are the main recent decisions in the field of international investment arbitration to which your country was a party? Are there any pending investment arbitration cases in which the country you are reporting about is a party?

In a judgment delivered on 18 June 2019, the General Court of the CJEU annulled a 2015 European Commission decision prohibiting the Romanian government from compensating Swedish investors, the Micula brothers, pursuant to a 2013 ICSID award. Back in 2015, the Commission had concluded that the ICSID award was incompatible with article 107 of the Treaty of the Functioning of the European Union (TFEU), on the ground that the payment of compensation constituted state aid. The General Court of the CJEU concluded that the 2015 EU decision was unlawful ‘in so far as it classified as an advantage and aid within the meaning of Article 107 TFEU the award, by the arbitral tribunal, of compensation intended to compensate for the damage resulting from the withdrawal of the tax incentives, at least in respect of the period predating the entry into force of EU law in Romania’. In its judgment, the General Court considered that the award acknowledged a right to compensation for the investors existing before Romania’s accession to the EU. As a result, the Commission was precluded from applying EU State aid rules to this situation, at least with respect to the pre-accession period. The General Court also noted that the amounts granted to the Miculas as compensation for the damage resulting from Romania’s repealing of the tax incentives regime were calculated by the arbitral tribunal from the moment that this regime was repealed (on 22 February 2005) until its scheduled expiry (on 1 April 2009). The General Court then noted that:

• with respect to the amounts granted as compensation for the period predating Romania’s accession to the European Union (ie, 22 February 2005-31 December 2006), those amounts could not constitute state aid within the meaning of EU law since EU law was not applicable during that period; and
• with respect to the amounts granted as compensation for the period subsequent to Romania’s accession to the EU (ie, 1 January 2007-1 April 2009), ‘even assuming that the payment of compensation relating to that period could be classified as incompatible aid, given that the Commission did not draw a distinction between the periods of compensation for the damage suffered by the applicants before or after accession, the Commission has, in any event, exceeded its powers in the area of State aid review’ (paragraph 91).

On 27 August 2019, the European Commission appealed against the decision of the General Court, Case C-638/19 P being registered on the CJEU’s docket. As its main argument, the Commission submits that the General Court was wrong to conclude that the measure through which Romania granted aid to the Micula brothers and three Romanian companies they control is the repeal of the incentive scheme on 22 February 2005. Rather, it is through the payment by Romania of the compensation awarded for the repeal of that scheme, which occurred after its accession to the EU that aid is granted to the Micula brothers. As a subsidiary argument, the Commission submits that, even if the General Court was right to conclude that the aid-granting measure was the repeal of the incentive scheme by Romania (quod non), the Commission was still competent to adopt the contested decision by virtue of annex V, Chapter 2, of Romania’s Act of Accession.

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