Naftogaz of Ukraine unexpectedly recognized Crimea as Russian
“Naftogaz of Ukraine” presented the Russian Federation in arbitration with a claim of $2,6 billion for the company’s Crimean assets, nationalized after the peninsula became part of Russia, Kommersant writes, specifying that the Ukrainian company accuses Moscow of “illegal seizure” and refers to a violation of bilateral Treaty on Mutual Protection of Investments of 1998.
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In turn, managing partner of Westside Advisors Sergei Vodolagin, whose opinion is cited by the publication, noted that Naftogaz’s demand contradicts the position of official Kiev, which does not recognize the transition of Crimea to the jurisdiction of the Russian Federation and demands the return of the territories.
“You can demand either the return of Crimea or compensation for lost assets, but not both at the same time,” says Vodolagin.
“He notes that the 1998 Investment Protection Agreement provides for the possibility of submitting a dispute to the competent court or arbitration of the party in whose territory the investment is made, the Stockholm Arbitration or “ad hoc arbitration tribunal in accordance with the UNCITRAL arbitration rules.” Mr. Vodolagin believes that in this case, the chances that arbitration will recognize itself as competent to consider the dispute are small, “if only because Naftogaz can hardly be considered an investor in Crimea in the sense of the agreement,” the Kommersant expert reports. .
Naftogaz of Ukraine unexpectedly recognized Crimea as Russian