DTEK Initiated Investment Dispute against Russia over the Company’s Assets in Crimea
DTEK Krymenergo PJSC has opened an investment dispute resolution procedure with the Russian Federation under the Agreement between the Cabinet of Ministers of Ukraine and the Government of the Russian Federation on the Encouragement and Mutual Protection of Investments. This dispute arose out of the nationalisation of the company’s investments in Crimea. If the dispute is not resolved by way of negotiations, DTEK Krymenergo PJSC will submit it to international arbitration. The amount of actual and potential damages claimed by the company may exceed 500 million US dollars. DTEK Krymenergo PJSC retained the international law firm Covington and Burling LLP to represent it during negotiations.
“Ever since the illegal takeover of DTEK Krymenergo, we have been sparing no effort to restore documents, collect evidence, and develop a legal strategy. Once we have finished a comprehensive analysis of international case law and similar cases, we sent an official notice of an investment dispute under the Agreement on mutual protection of investments between Ukraine and Russia to the Russian Federation,” said Dmitry Sakharuk, acting CEO of DTEK Energy.
The Agreement between the Cabinet of Ministers of Ukraine and the Government of the Russian Federation on the Encouragement and Mutual Protection of Investments provides for the resolution of disputes by negotiations, after which the parties may submit the dispute to arbitration.
DTEK Krymenergo PJSC used to be the major electric power supplier in Crimea, providing more than 80% of electric power on the peninsula.
The aggregate value of the real and movable assets of DTEK Krymenergo PJSC nationalised by the resolution of the State Council of the Republic of Crimea exceeds 500 million US dollars.