On 19 July 2022, the Court of Appeal of The Hague in the Netherlands (the Court of Appeal) rejected in their entirety russia’s challenges against the Interim Award dated 24 February 2017 and the Partial Award dated 4 February 2019 on jurisdiction and liability issued by the Permanent Court of Arbitration in The Hague (PCA) in the investment treaty arbitration case – JSC CB “PrivatBank” against russia. The Court of Appeal’s judgment removes another obstacle raised by russia against PrivatBank’s case, which now will proceed to a final hearing on quantum before the PCA in October 2022.

Gerhard Boesch, Chairman of the Management Board of PrivatBank commented: “This judgment marks an important victory for the rule of law. Specifically, in these hard times for Ukraine, it is important that the aggressor faces the consequences of its actions. I am proud of the Bank for reaching justice by defending its rights.”

As informed earlier, until April 2014, PrivatBank maintained substantial operations and valuable assets in the Crimean Peninsula, including loans, real estate and cash. Shortly after unlawfully occupying Crimea, russia took several measures which resulted in the illegal expropriation of PrivatBank’s Crimean assets, and the termination of PrivatBank’s operations in Crimea.

As a result, in 2015 PrivatBank initiated arbitration proceedings against russia under the 1998 Bilateral Investment Treaty. In those proceedings, from which russia chose to abstain, the tribunal issued an interim award and partial award, holding that the tribunal had jurisdiction over the dispute, and that russia unlawfully expropriated PrivatBank’s assets in Crimea. In 2019 russia launched a case before the Court of Appeal, requesting the revocation or setting-aside of the tribunal’s awards.

PrivatBank was represented before the Court of Appeal by De Brauw Blackstone Westbroek N.V., with assistance from Quinn Emanuel Urquhart & Sullivan UK LLP, lead counsel in the arbitration case, and Asters, Ukrainian counsel to PrivatBank.