Kyrgyzstan searching for funds to protect itself from Kazakhstan company's $400 million claim 17 апреля 2013, 15:54
Photo courtesy of gmpk.el.kg
Kazakhstan company Visor Holding filed a $400 million claim against Kyrgyzstan government to the World Bank’s International Center for Settlement of Investment Disputes (IC SID), Tengrinews.kz reports citing the press-service of Kyrgyzstan Ministry of Economy and Antimonopoly Policy.
The claim is related to expropriation of the license for development of Dzherui gold mine in Talas oblast of Kyrgyzstan from the company partly owned by Visor Holding. Kazakhstan company Visor Holding owns 60 percent in Dzheruialtyn. This is a joint venture with Kyrgyzstan. It had a license for development of Dzherui field. The claimant insists that Kyrgyzstan government illegally withdrew the license of Dzhruialtyn for development of the deposit. Besides, according to the Kazakhstan investors, Kyrgyzstan government tried to liquidate Dzheruialtyn and terminate the joint activity agreement.
According to the Ministry, the country’s government won the case in the courts of Kyrgyzstan. The investors, however, decided to defend their interests in the International Arbitration, considering that Kyrgyzstan violated rights of foreign investors and infringed on the Agreement between the governments of Kazakhstan and Kyrgyzstan on promotion and mutual protection of investments.
Now Kyrgyzstan government is searching for funds to pay the layers to represent it in the International Arbitration, trying to lower the risks for the country’s budget.
Kyrgyzstan is currently preparing to auction Dzherui gold mine. An expected starting price has been set to $300 million.