Procedural Background

This decision addresses the Argentine Republic’s application for the continuation of the stay of enforcement of the arbitral award rendered on 28 April 2025 in favor of Webuild S.p.A. Following Argentina’s application for annulment of the award under Article 52 of the ICSID Convention, the ICSID Secretary-General provisionally stayed enforcement. The ad hoc Committee was subsequently constituted to determine whether the circumstances required the continuation of the stay pending the outcome of the annulment proceeding.

Parties' Positions

Argentina argued that the stay should be continued unconditionally. It submitted that its domestic legal framework adequately safeguards compliance with ICSID awards, that Webuild would suffer no prejudice beyond a temporary delay fully compensated by post-award interest, and that lifting the stay would cause Argentina serious harm. Specifically, Argentina contended that enforcement would disrupt public expenditure, interfere with its macroeconomic stabilization objectives under an International Monetary Fund facility, and expose it to significant difficulties in recouping funds or facing third-party attachments if the award were ultimately annulled. Webuild opposed the stay, arguing that Argentina has a demonstrated pattern of non-compliance with international awards. Webuild further asserted that a continued stay would cause it irreparable harm and that Argentina possessed the financial capacity to satisfy the award or provide adequate financial security.

Committee's Analysis

The ad hoc Committee emphasized that under Article 52(5) of the ICSID Convention, an award is binding and enforceable, and a stay may only be granted if the applicant establishes circumstances that necessitate it. The Committee determined that the existence of a domestic legal framework capable of enforcing awards does not, in itself, constitute a circumstance requiring a stay. Furthermore, the Committee held that even if Webuild were to suffer no prejudice beyond a temporary postponement of payment, the mere absence of prejudice to the award creditor does not justify continuing the stay.

Turning to the alleged harm to Argentina, the Committee found that the State failed to demonstrate a concrete, case-specific, and time-sensitive risk of prejudice. The Committee reasoned that general macroeconomic constraints, budgetary flexibility, and obligations under IMF programs do not establish that the possibility of enforcement would produce the requisite prejudice. Additionally, the Committee dismissed Argentina’s concerns regarding the potential difficulties of recoupment and the risk of third-party attachments as contingent possibilities inherent in the ICSID system, which do not independently necessitate a stay of enforcement.

Decision

The ad hoc Committee rejected the Argentine Republic’s application for a continued stay of enforcement. Consequently, the Committee ordered that the provisional stay of enforcement currently in place be lifted with immediate effect. The Committee reserved its decision on the allocation of costs, fees, and expenses incurred in connection with the application for its final decision on annulment.