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Russian Justice Ministry called the lawsuit filed by PrivatBank, Ukraine’s largest commercial bank, against Russia "on protection of lost investments due to the annexation of Crimea" groundless and said that Russia did not recognize the jurisdiction of international arbitration for consideration of the dispute, Russian information agency RBC reported with reference to the ministry’s press service.
An arbitration court has been formed and will carry out the proceedings in accordance with the Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL), the bank's press service told Interfax-Ukraine on Wednesday.
"An international arbitration claim PrivatBank filed against the Russian Federation in the Permanent Court of Arbitration (the Hague) cannot be considered on the basis of the intergovernmental agreement dated November 27, 1998, between Russia and Ukraine on promotion and mutual protection of investments. Accordingly, the agreement cannot serve as a basis for the arbitration proceedings regarding the dispute", the ministry’s statement reads, according to RBC.
According to the Russian ministry’s press service, the term "investment", under the agreement, means all kinds of property and intellectual values invested by an investor of one party to the agreement in the territory of the other party in accordance with its legislation.
Article 9 of the agreement referred to by the Russian Justice Ministry states that an investor of one of the signatory states may appeal to international arbitration with a claim to the other state to protect its interests.
The Russian Federation does not recognize the jurisdiction of international arbitration at the Permanent Court of Arbitration for consideration of the dispute, according to the statement.
It is reported that the arbitration will be held in The Hague (Netherlands), and the amount of the claim will be determined by the Special Commission of foreign experts.
As UNIAN reported earlier, a state-owned Oschadbank filed a lawsuit against the Russian Federation demanding compensation for losses, incurred by the bank as a result of the illegal annexation of Crimea, which total about UAH 15 billion.