Statis Case: What’s Behind the Svea Court Decision?

Defending the 85 $ mln, the National Bank of Kazakhstan had used an ineffective UN Convention on Jurisdictional Immunities of States and Their Properties. Nonetheless, the Svea Court of Appeal admitted it. Now the Statis will appeal this decision to the Swedish Supreme Court. In the article «Stati’s Case Against Kazakhstan. Explaining the Svea Court Decision», KZ.MEDIA reports on the developments of the case.

Since we try keeping our reader informed on the intricacies of this international scandal, we would like to present the entire article here.

Yesterday we learned that the Svea Court of Appeal, the biggest one of the six appellate courts of Sweden, admitted the appeal filed by the National Bank of Kazakhstan’s attorneys (the Ministry of Justice of the Republic of Kazakhstan has confirmed this information today).

We are talking about the fate of the US85 $ mln arrested in Sweden to secure the claim of Gabriel and Anatolie Statis that was won back in 2013 in the International Court of Arbitration. According to its decision, Kazakhstan was to pay the investors US543 $ mln which it did not do, so then the Statis began trying to enforce the arbitration decision in the national courts of different countries. Sweden was on of the vanguards of this battle.

The National Bank of Kazakhstan had managed to get their appeal be admitted via using the UN Convention on Jurisdictional Immunities of States and Their Properties. Signed at the UN General Assembly meeting on December 2, 2004, this document was to clarify the trial procedures involving states (which, in fact, it failed to do).

The idea was to include states’ assets in the system of international legal disputes involving states to the fullest. In doing so, they were hoping to put an end to the abuse of the «sovereign right» concept which allowed to exclude different forms of property from legal debates.

However, it so happens that the 2004 document never came into force. For that to happen, thirty states needed to ratify the Convention. This has never been achieved and now the document’s status is «ineffective».

By the way, in 2011, this fact was used by the Russian Ministry of Foreign Affairs when the agency challenged the arrest of the Russian Trade Mission building in Sweden.

Nonetheless, as we can see the Svea Court believed the document to be legitimate and relied on its norms. Especially since Kazakhstan ratified the Convention on February 17, 2010.

The appeal was filed based on Article 21 of the Convention that defines the special categories of property that «are not to be considered as property used or intended to be used by the state for other than non-commercial purposes». And the properties of «central banks or other state’s financial body» belong to this category. 

The argument of whether the National Bank’s assets are to be considered state property has long been a part of the Statis case. We have written on the subject in considerable detail. Formally, the National Bank may be considered an independent agency. In actuality, however, this independence is clearly a simulacrum — a form without a content.

Which by the way clearly follows from the news on the Swedish decision. Formally, it came from the National Bank of Kazakhstan. However, the situation itself was presented through the eyes of Kazakh Minister of Justice Marat Beketayev. The Head of the Ministry of Justice of the Republic of Kazakhstan, as is commonly known, uses any excuse to play the victory march in the Statis case.                        

In reality (and the National Bank of Kazakhstan knows it full well), the Svea Court decision does not lift the arrest from the US85 $ mln. The sum continues to be frozen. The admission of the appeal means that the case will be examined in detail «with regard to its tremendous social significance».

Therefore, the case has, once again, been reopened and the final decision has not yet been made.

The 85 mln will be frozen until the Swedish Supreme Court will have made its decision, says Anatolie Stati’s statement. According to the data we’ve received, the Statis are preparing an appeal in which they will challenge the «wrong and narrow» interpretation of the international law principles by the Svea Court. The appeal is supposed to result in a new decision in re this issue. 

Anyway, the Statis say that the Svea decision has affected neither the verdict of the International Court of Arbitration nor the procedures of its forcible execution in national jurisdictions. The Statis are still in control of more than 6 $ bln of Kazakhstan’s state assets including a share in the Kashagan oilfield.


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