Available in Russian
Author: Iliya Rachkov
DOI: 10.21128/2226-2059-2024-2-43-62
Keywords: international investment arbitration; bilateral investment treaties; challenge to the lawyers representing a party; online hearings; attribution of acts to the State; standards for the treatment of foreign investors and their investments
In this article, the author analyses the arbitral award rendered in 2023 in the case brought by MTS PJSC (Russia) against Turkmenistan. The dispute was considered in accordance with the Additional Facility Rules of the International Center for Settlement of Investment Disputes (ICSID), although, as a rule, disputes at ICSID are resolved in accordance with the 1965 Washington Convention for the Settlement of Investment Disputes between States and Nationals of Other States. However, since Russia never ratified this Convention, it does not apply to disputes between Russian claimants and Turkmenistan as the respondent. The substantive law basis for the claims is the Agreement between the Government of the Russian Federation and the Government of Turkmenistan on the promotion and mutual protection of investments (2009). This type of treaty establishes the standards for the treatment of foreign investors and for their investment by the state receiving such foreign investment (in this case, Turkmenistan) from another country that is a party to the treaty (Russia). In the same vein, the Agreement also lists standards of fair and equitable treatment, minimum standard of treatment, national treatment, full protection and safety, the obligation of the host state to issue all permits necessary for the implementation of the permitted investments, most favored nation treatment, and freedom of money transfers. As in many other similar disputes, in the present case the arbitrators had to answer the question of what the content of these standards was. In addition, the panel of arbitrators examined the claimant’s arguments for its challenge of the respondent’s representatives, the respondent State’s request to hold an in-person hearing, and the significance of the settlement agreement previously concluded between the parties. The panel assessed the behavior of various persons and bodies from the point of view of imputation of their acts and omissions to the State as a subject of international law. In a great victory, the dispute was resolved in favor of Turkmenistan. However, MTS is now trying to get this arbitration award set aside by the state courts of Sweden which was the location of arbitration.
About the author: Iliya Rachkov – Candidate of Sciences (PhD) in Law, Associate Professor of the Departament of International Law, MGIMO, Ministry of Foreign Affairs of the Russian Federation, Moscow, Russia.
Citation: Rachkov I. (2024) Obzor resheniya mezhdunarodnogo investitsionnogo arbitrazha ot 14 iyulya 2023 goda po delu PAO “Mobil'nye telesistemy” protiv Turkmenistana (ICSID Case no. ARB(AF)/18/4) [Review of the decision of the international investment arbitration dated July 14, 2023 in Mobile TeleSystems PJSC v. Turkmenistan (ICSID Case No. ARB(AF)/18/4)]. Mezhdunarodnoe pravosudie, vol. 14, no. 2, pp. 43–62. (In Russian).
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