The court of the Astana International Financial Centre (AIFC) has annulled the preliminary ruling on the recognition and enforcement in Kazakhstan of the arbitral award in the dispute between Naftogaz of Ukraine and Gazprom. This was reported by RBC-Ukraine citing Forbes Kazakhstan.
The case involves a substantial sum of approximately $1.4 billion. Previously, in May, the AIFC court, operating under British law, had permitted the enforcement of the arbitral award in Kazakhstan. This had opened the possibility for the Ukrainian company to seek compulsory recovery of funds from the Russian monopolist on Kazakh territory.
Ruling loses legal force
Following a review of the case, the previous court determination was abolished. It has now lost its legal force. This means that the international arbitration ruling against Gazprom cannot currently be enforced in Kazakhstan based on the annulled AIFC determination.
Position of the Kazakh Ministry of Justice
Even before the annulment of the ruling, the Ministry of Justice of Kazakhstan stated that it would not be executed. The head of the ministry, Erlan Sarsembaev, explained his position with three arguments:
- The dispute does not fall under the jurisdiction of Kazakhstan;
- The Russian side did not participate in the consideration of the case;
- The court determination itself was not final.
History of the conflict
The dispute between Naftogaz and Gazprom arose from a contract for gas transit through Ukraine, which was in effect from 2019. After the transit was stopped through the Sokhranovka station in 2022, the Ukrainian company demanded compensation from the Russian monopolist. It is this sum — $1.4 billion — that became the subject of the arbitration proceedings.
