In Case C‑638/19

3The Convention on the Settlement of Investment Disputes between States and Nationals of Other States, concluded in Washington on 18March 1965 (‘the ICSID Convention’), which entered into force with respect to Romania on 12October 1975, provides in Article53(1):

‘The award shall be binding on the parties and shall not be subject to any appeal or to any other remedy except those provided for in this Convention. Each party shall abide by and comply with the terms of the award…’

4Article54(1) of the ICSID Convention provides:

‘Each Contracting State shall recognise an award rendered pursuant to this Convention as binding and enforce the pecuniary obligations imposed by that award within its territories as if it were a final judgment of a court in that State…’

The Europe Agreement

5The Europe Agreement establishing an association between the European Economic Communities and their Member States, of the one part, and Romania, of the other part, concluded and approved on behalf of the Community by Decision 94/907/ECSC, EC, Euratom of the Council and the Commission of 19December 1994 (OJ 1994 L357, p.2, ‘the Europe Agreement’), which entered into force on 1February 1995, provided in Article64(1) and (2) as follows:

‘1.The following are incompatible with the proper functioning of this Agreement, in so far as they may affect trade between the Community and Romania:

…

(iii)any public aid which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods.

2.Any practices contrary to this Article shall be assessed on the basis of criteria arising from the application of the rules of Articles[101, 102 and 107 TFEU]’.

6Under Articles69 and 71 of The Europe Agreement, Romania was required to align its national legislation with the acquis communautaire.

The BIT

7The Bilateral Investment Treaty concluded on 29May 2002 between the Swedish Government and the Romanian Government on the Promotion and Reciprocal Protection of Investments (‘the BIT’), which entered into force on 1July 2003, provides, in Article2(3):

‘Each Contracting Party shall at all times ensure fair and equitable treatment of the investments by investors of the other Contracting Party and shall not impair, by means of arbitrary or discriminatory measures, the administration, management, maintenance, use, enjoyment or disposal thereof by those investors’.

8Article7 of the BIT provides that any dispute between investors and the Contracting Parties is to be settled, inter alia, by an arbitral tribunal which applies the ICSID Convention (‘the arbitration clause’).

The Treaty on the Accession of the Republic of Bulgaria and of Romania to the European Union and the Act of Accession

9Under the Treaty on the accession of the Republic of Bulgaria and Romania to the European Union (OJ 2005 L157, p.11), signed on 25April 2005, Romania acceded to the European Union with effect from 1January 2007.

10Article2 of the Act concerning the conditions of accession of the Republic of Bulgaria and Romania and the adjustments to the Treaties on which the European Union is founded (OJ 2005 L157, p.203, ‘the Act of Accession’) states:

‘From the date of accession, the provisions of the original Treaties and the acts adopted by the institutions… before accession shall be binding on… Romania and shall apply in [that State] under the conditions laid down in those Treaties and in this Act.’

11AnnexV to the Act of Accession includes Chapter 2, entitled ‘Competition policy’, which contains, in paragraphs1 and 5, specific provisions concerning aid schemes and individual aid implemented in Romania before the date of accession to the European Union and still applicable after that date.

Regulation No659/1999

12Under the heading ‘Formal investigation procedure’, Article6 of Council Regulation (EC) No659/1999 of 22March 1999 laying down detailed rules for the application of Article108 [TFEU] (OJ 1999 L83, p.1) as amended by Council Regulation (EU) No734/213 of 22July 2013 (OJ 2013 L204, p.15) (‘Regulation No659/1999’) provided in paragraph1.

‘The decision to initiate the formal investigation procedure shall summarise the relevant issues of fact and law, shall include a preliminary assessment of the Commission as to the aid character of the proposed measure and shall set out the doubts as to its compatibility with the [internal] market. The decision shall call upon the Member State concerned and upon other interested parties to submit comments within a prescribed period which shall normally not exceed one month.…’