The dispute concerned the Greek claimant's investment in a frozen-food warehousing business which he had acquired from the Romanian state. The claimant alleged various breaches of the Greece-Romania bilateral investment treaty (BIT), principally arising from Romania's attempts to enforce certain post-purchase obligations (including in particular a share pledge) in the Romanian courts. In addition, the claimant relied on steps taken by the Romanian tax and food safety authorities, and an "interdiction" order, which had prevented him from leaving the country. In response, Romania advanced counterclaims seeking, in effect, to enforce the share pledge.

The tribunal held that it had jurisdiction to hear the claimant's claims, but dismissed them on the merits. The main point of interest in the decision lies in the approach to the issue of jurisdiction over the counterclaim. The majority of the tribunal held that the parties had not consented to the counterclaim being arbitrated for the purposes of Article 46 of the ICSID Convention and Rule 40 of the ICSID Arbitration Rules.

These provisions permit the tribunal to entertain counterclaims if they:

Turning to the wording of the BIT, the arbitration clause in Article 9 referred to:

In the majority's view, this wording limited the parties' consent to claims brought by investors about obligations of the host state. This conclusion was borne out by the fact that the tribunal was expressly obliged to decide the dispute in accordance with the provisions of the BIT (Article 9(4)). The BIT, however, imposed no obligations on investors, only on contracting states, indicating that the parties intended to refer only claims against the host state to arbitration, and not claims by the host state. Nor could the umbrella clause in the BIT be relied on to overcome this absence of consent.

The dissenting arbitrator, W Michael Reisman, disagreed. In his view, where state parties consent to ICSID jurisdiction, "the consent component of Article 46 ... is ipso facto imported into any ICSID arbitration which an investor then elects to pursue". To hold otherwise meant that the respondent state would be obliged to pursue its claims in its own courts, rather than in the neutral forum selected by the investor. This outcome, he contended, would be both inefficient and absurd.

For further information about counterclaims in ICSID jurisdiction, see Practice note, ICSID arbitration: a step-by-step guide.

Case: Roussalis v Romania (ICSID Case No ARB/06/1).