Originally from the Journal of Damages in International Arbitration

Preview Page

Decision on Rectification
July 13, 2017

The Parties
Marco Gavazzi and Stefano Gavazzi (the “Claimants”), Romania (the “Respondent”)

Sector
Steel

Applicable Treaty
Bilateral Investment Treaty between Italy and Romania

Members of the Tribunal
Hans Van Houtte (President), V.V. Veeder (Claimants’ appointee), and Mauro Rubino-Sammartano (Respondent’s appointee)

I.  BACKGROUND

In 1999, Claimants invested in a Romanian steel company, S.C. Socomet S.A. (“Socomet”) undergoing privatization.  Claimants agreed to acquire 70% of Socomet’s shares, provided that Socomet’s existing debts would be rescheduled or forgiven. But Socomet’s debts were not restructured and the Romanian government froze its bank accounts in order to cover the debt. This act and the resulting insolvency prevented Claimants from reviving Socomet.