Baltic States – CIS, Banks, EU – Baltic States, Financial Services, Latvia, Legislation

Valeri Belokon, a Latvian businessman and banker, lodged a claim in the international arbitration against the Government of the Kyrgyz Republic concerning the expropriation of Kyrgyzstan-based Manas Bank owned by him. The claim was considered by ad hoc Arbitration Tribunal established in accordance with the Agreement between the Government of the Republic of Latvia and the Government of the Kyrgyz Republic for the Promotion and Protection of Investments. The Tribunal was composed of three internationally recognized independent arbitrators.

After having evaluated the jurisprudence of international arbitrations, Mr Belokon decided to request the Tribunal to ascertain whether the Government of the Kyrgyz Republic had any basis to seize the bank and sought monetary compensation for the value of the expropriated bank. Mr Belokon did not submit claims for compensation of unearned income and reputational harm as it is difficult to appraise and prove these claims.  

Mr Belokon feels satisfied with the arbitration award.

In April 2010, after the political upheaval in the Kyrgyz Republic, the representatives of the new political power expropriated Manas Bank owned by Mr Belokon.