The firm EuroGas has given Slovakia an ultimatum, demanding $1.65 billion in compensation for its mining rights having been taken away, according to a statement made by Board of Directors chairman Wolfgang Rauball on Thursday.
“EuroGas had previously sought compensation over this interrupted investment to the value of $1.65 billion. It will pursue this claim now, if the Slovak Republic doesn’t make use of an opportunity to settle out-of-court by January 31, 2014”, said Rauball.
EuroGas had declared its interest to initiate arbitration proceedings against Slovakia since 2010, when its subsidiary company Rozmin claimed that in 2004 Slovak authorities stepped in and removed its mining rights in Gemerská Poloma illegally. “For Slovakia, such arbitration at ICSID would mean that any appeal against the tribunal’s verdict would be impossible, barring cancellation of the case due to serious flaws in legal proceedings”, said lawyer Jana Martinková, adding that, “If the indicted party loses, it would also mean that postponing compensation payments by appealing with national courts would not be possible, and it would have to pay immediately, and in full, along with interest and arbitration costs”.
EuroGas based its claim on a violation of its rights stemming from the 1991 Agreement on Mutual Support and Investment Protection, however the Slovak Finance Ministry has since claimed that no violation of the agreement ever took place.
