Akipress | 22 February 2017
Manas Bank v. Kyrgyz Republic: Paris Appeals Court annuls $16.5 million award for Valeri Belokon
The Paris Appeals Court annuled $16.5 million award for Latvian businessman Valeri Belokon and reinstated the evidence that Manas Bank employees were engaged in money laundering, Tazabek reported Wednesday citing the Government’s legal representation center.
Belokon, a Latvian citizen who invested in Kyrgyzstan by purchasing Manas Bank, had initiated arbitration in 2011, alleging that the country had expropriated his investment in violation of an investment treaty between Latvia and the Kyrgyz Republic.
Kyrgyzstan had argued that its takeover was necessary due to alleged money laundering and other criminal activities undertaken by Belokon and his employees.
On 24 October 2014, the Paris Arbitration Court ruled for the former owner of the Manas Bank Valeri Belokon and awarded damages in the amount of US$ 16.5 million to be paid by the Kyrgyz Republic.
The arbitral tribunal concluded that Kyrgyzstan had indirectly expropriated Manas Bank by leaving in place certain "temporary" measures that were aimed at providing physical security to Manas Bank. In fact, the tribunal found, the ongoing imposition of an administrative and sequestration regime on the bank, with no end in sight, for at least four years amounted to a disguised taking and expropriation of Manas Bank.
On 22 January 2015, Kyrgyzstan asked the Paris Court of Appeal to annul the award.