Norvik bank taking Latvia to international arbitration

One of Latvia's leading banks said December 14 it was taking the Latvian state to international arbitration proceedings in a dispute spearheaded by a wealthy Russian businessman.

"On 12 December 2017, AS Norvik Banka and its controlling shareholders submitted a Request for Arbitration against the Republic of Latvia to the International Centre for the Settlement of International Investment Disputes (ICSID). Mr Guselnikov, a UK investor, acquired the Bank in 2013 and has invested in Latvia in excess of € 100 million, making him one of the most significant individual investors in the country," the bank said in a statement.

Though Russian born, Guselnikov was a partner with London-based investment fund G2 Capital Partners when he acquired a majority stake in Norvik in 2014, hence the "UK investor" designation.

ICSID operates under the authority of the World Bank, and is the primary forum for settling international investment disputes arising under international law.

"Following the registration of the Bankʼs Request for Arbitration, an ICSID Tribunal will soon be constituted to hear the Bank and its shareholders' claims. The ICSID Tribunal will render its decision on the basis of international law and its final decision will be binding and immediately enforceable," the bank said.

"The Bank and its controlling shareholders have requested arbitration as a result of unfair, arbitrary, improperly motivated and unreasonable regulatory treatment accorded to the Bank by the Latvian authorities, contrary to Latviaʼs obligations under international law. The filing of the Request for Arbitration follows unsuccessful negotiations between the Latvian Government and the Bank, wherein multiple options were proposed by the Bank for mutual agreement not requiring financial outlays. The Bank and its shareholders remain hopeful of reaching a mutually agreeable settlement agreement with the Latvian Government, but have commenced the arbitration in order to protect and enforce their legal rights," the bank added.

However, the precise nature of the dispute was not revealed, other than to say it was "of an investment nature" and would not affect the daily operations of the bank.

The sum being sought by Guselnikov was not revealed either, though according to the slogan of his twitter account "The world is not enough", so it could be substantial. 

Back in 2011 he was telling the BBC about the joys of doing business in the UK after buying a flagship Rolex store in London for more than 13 million pounds and gaining "the most exclusive address in the world", namely One, Hyde Park.

Related articles
0 comments
Comment
Comment using your social media profile
Banks
Economy