On 19th December was the 11th anniversary since the Stockholm Arbitration Court Award on the case of Stati vs the Republic of Kazakhstan was made. On exactly that date in December 2024 the Settlement Deed between the parties has been publicly announced. This matter may finally be considered closed. The award satisfied everyone which means it can qualify as the “win-win” agreement. Therefore, we cannot help but feel proud that our firm had the honour of acting as the Kazakhstan law adviser on this settlement and made its contribution to the execution of the Settlement Deed between the foreign investors and Kazakhstan.
It is difficult to overestimate and too easy to underestimate the significance of this event. This is the largest international arbitration award in the country's history. This is not just because it is the largest case from an economic point of view, although this is definitely a very vital factor. The positive effect from the Settlement Agreement is multiplicative. The Settlement Deed is extremely positive for the country and the entire post-Soviet region, for litigation practitioners, for professional negotiators, for the Government and, most importantly, for the citizens of Kazakhstan. Only recently the National Bank of Kazakhstan announced the return of the National Fund assets from Sweden as a positive effect from the Settlement.
The closure of the unenforced arbitration award opened up new opportunities for the Government. International debt and equity capital markets with billions of dollars are now open to Kazakhstan, and new potential litigation arguments appear in Kazakhstan's favour in current and future international arbitration cases, including arbitration treaties and the Energy Charter Treaty1. It is quite possible that the Energy Charter was the very first, or at least one of the very first international documents entered into by our country. It was signed on 17 December 1991, just one day after the adoption of the Law On Independence.
The Settlement Deed has become excellent example of successful negotiations by the Republic of Kazakhstan on issues resulting from litigation and arbitration disputes.
The parties are pleased to have reached an agreement on favourable terms, which will bring an end to all legal proceedings and the suspension of any ongoing claims across all jurisdictions. The specific terms of the agreement are confidential.
Daniel Chapman, CEO of Argentem Creek Partners*:
“We support the framework agreement and commend President Tokayev’s decision to create a Fair Kazakhstan as part of his admirable reforms. With the settlement of this dispute, Kazakhstan is honouring international treaty obligations and thereby opening its doors for increased investment and heightening its economic growth potential. We welcome this new era for Kazakhstan.”
Azamat Yeskarayev, Minister of Justice of the Republic of Kazakhstan:
“This agreement was made in view of the public interest and does not involve spending of budgetary funds. We believe that this move will have a positive effect on attracting new investments in our country and on growth of the economy.”
*Argentem Creek Partners is an investment manager to certain funds which are creditors of Tristan Oil Limited, the investment vehicle of the Stati parties.