DORDA Successfully Obtains an Order for the Enforcement of an ICSID Award in Favour of Italian Investors Against the Republic of Albania in Austria
December, 2020 - Vienna, Austria
This July, DORDA initiated enforcement proceedings against Albanian assets in Austria. This was preceded by an ICSID (International Centre for Settlement of Investment Disputes) arbitration, which Italian investors commenced against Albania following the expropriation of investments in Albania's hydropower, wind energy and media industries. However, the Albanian government fails to comply with its payment obligations.
Vienna, 2 December 2020 - In 2015, investors from Italy initiated arbitration proceedings against Albania under the ICSID Convention. In April 2019, an arbitral tribunal awarded them compensation of approximately EUR 100 million (plus interest and costs). Since the Albanian government still refuses to comply with the arbitral award, the Italian investors had to initiate enforcement proceedings in several jurisdictions to get hold of the country's assets (to the extent that they are not protected by diplomatic conventions).
Enforcement of ICSID awards is something of a rarity
Under the leadership of Florian Kremslehner, partner at DORDA and head of the Dispute Resolution team, the outstanding claims are now also being enforced in Austria by seizure of Albania's claims and other economically relevant rights. Together with Philip Exenberger, attorney at law who specialises in complex disputes, Alexander Karl, attorney at law who specialises in commercial litigation and international enforcement, and Robert Keimelmayr, associate, the request for enforcement was filed in the end of July 2020. The enforcement includes highly complex issues of international law, in particular regarding state immunity.
"Enforcement proceedings like this one do not occur frequently, because countries usually comply with arbitral awards," explains Florian Kremslehner. "The special situation here is also that parallel proceedings are conducted in many European countries, and enforcement is required in other states if state sovereignty is invoked."
In order to collect up to EUR 25 million for one of the plaintiffs, DORDA conducts enforcement in accounts and securities deposits at several banks in Austria as well as in concession fees and other claims. As Austria has acceded to the ICSID-Convention, domestic courts must recognise and enforce ICSID arbitral awards. The District Court Innere Stadt Wien approved the application for enforcement on 10 November 2020.
