ASHGABAT (TCA) — Russian telecommunications giant MTS has filed a case with a World Bank arbitration center for at least $750 million in compensation from Turkmenistan for the forced closure of its daughter company in the Central Asian country.
The Moscow-based company said in a July 27 statement that it has filed a Request for Arbitration against the Sovereign State of Turkmenistan with the World Bank’s International Center for Settlement of Investments Disputes (ICSID).
In September 2017, MTS’s wholly-owned subsidiary MTS-Turkmenistan was compelled to suspend its operations in Turkmenistan due to the actions of the Government of Turkmenistan, including the actions of the Ministry of Communications and other entities owned, controlled and directed by the Turkmen State, the statement said. “The Company considers that the Turkmen State has violated its rights as a foreign investor under the Agreement on Promotion and Reciprocal Protection of Investments (the “Treaty”) signed between the Government of the Russian Federation and the Government of Turkmenistan on March 29, 2009, ultimately resulting in the total expropriation of the Company’s investment in Turkmenistan. The Company’s total losses caused by the violation of its rights under the Treaty have not yet been fully quantified, but are estimated to be at least USD 750 million.”
In accordance with the Treaty, MTS has been pursuing an amicable resolution of this dispute, and gave a formal notice to the Government of Turkmenistan more than six months ago of its intention to pursue relief under the Treaty if no agreement could be reached. “Regrettably, such agreement has not been reached and therefore MTS is initiating these legal proceedings before the ICSID in order to protect its legal rights and investments in Turkmenistan,” the Russian company said.
