Foreign investors file major lawsuits against Armenian government

  27 June 2024    Read: 972
  Foreign investors file major lawsuits against Armenian government

On June 21, the Secretary-General of the World Bank's International Centre for Settlement of Investment Disputes (ICSID) registered the arbitration claim of Walnort Finance Limited against the Republic of Armenia, which was filed on June 3 and submitted to the Office of the Prime Minister, the Armenian ministries of foreign affairs and finance, as well as the Armenian Representative for International Legal Affairs.

According to Walnort, their arbitration claim follows a notice of dispute submitted to the Government of the Republic of Armenia on 16 October 2023 and addressed to Prime Minister Nicol Pashinyan. The government was notified of serious breaches of the obligations it had undertaken under the "Agreement between the Government of the Republic of Armenia and the Government of the Republic of Cyprus on the Encouragement and Protection of Investments" of 1998, reports citing Armenia media.

"Walnort's investment in Armenia's largest mining company, Zangezur Copper-Molybdenum Combine CJSC (ZCMC), was thwarted as a result of the government's politically motivated campaign to obtain a significant stake in ZCMC. Specifically, the government prevented Walnort from exercising its legal shareholder rights in ZCMC, resulting in losses of at least $1.2 billion (an expert assessment could significantly increase this amount).

Contrary to Walnort's good faith efforts after being notified of the dispute to negotiate a solution to these issues, the Armenian government chose not to cooperate with the company at all. On the contrary, the government escalated the dispute by supporting attacks on Walnort's subsidiaries in Armenia (Mun Metals CJSC and Zangezur Mining LLC).

Walnort's management, with its shareholders and group companies, prioritises focusing on this dispute in order to protect the company's rights and preserve its values.

In the ICSID proceedings, Walnort is represented by a team of highly qualified lawyers, with internationally recognised consultants and experts also involved in the case. Although it is disappointing that the Armenian government has chosen the unnecessary path of litigation, Walnort is ready to pursue its claims to the end both in ICSID and beyond," the company said in a statement.

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