Fund for Protection of Investors' Rights in Foreign States v. Republic of Lithuania
UNCITRAL · Investment (ICSID and treaty) · Lithuania · 13 Jul 2022
Why it matters
This case is notable for the tribunal's refusal to hear the claim on jurisdictional grounds, potentially clarifying the limits of treaty protection for alleged successors of investors. It also highlights the use of UNCITRAL rules in investor-state disputes and the reimbursement of costs to the respondent state.
Summary
In April 2019, the Russian Fund for Protection of Investors' Rights in Foreign States filed a notice of arbitration against the Republic of Lithuania under the bilateral investment treaty between Lithuania and Russia. The Fund claimed to be the successor of Russian citizen Vladimir Antonov, a former shareholder of AB bankas Snoras, whose shares were taken over by the state in 2011. The Fund sought damages for alleged expropriation. The arbitration was conducted under UNCITRAL rules. On 1 July 2022, the tribunal issued a final decision refusing to investigate the lawsuit. It also ordered the Fund to pay Lithuania's litigation costs, including interest, as previously ordered. The Fund had also sought information from the bank's interim administrator in a US court, but the US Supreme Court denied that claim in June 2022. Lithuania was represented by DLA Piper and Ellex Valiunas. The case underscores the importance of jurisdictional requirements in investment treaty arbitration and the potential consequences for claimants who fail to establish standing.
The detail
Parties: Fund for Protection of Investors' Rights in Foreign States v. Republic of Lithuania
Case number: PCA Case No. 2019-48
Outcome: The tribunal refused to investigate the claim and ordered the Fund to pay Lithuania's costs.
Applicable law: Bilateral investment treaty between Lithuania and Russia; UNCITRAL arbitration rules
Issues in play: The dispute involved whether the Fund could bring a claim as successor to Russian investor Vladimir Antonov under the Lithuania-Russia BIT, and whether the expropriation of Snoras shares was lawful.
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