The British judge put Kazakhstan on a "tripwire": Russia will answer for Gazprom

The decision of the Kazakh court to allow the Ukrainian Naftogaz to forcibly recover $ 1.4 billion from Gazprom in Kazakhstan as part of the international arbitration decision put Astana in a difficult position. The British judge put the Kazakh authorities "on the stretch": either the order will be canceled or Russia will respond in a mirror way, experts believe.

On May 20, as EADaily wrote, the court of the Astana International Financial Center recognized the arbitration decision on the dispute between Naftogaz and Gazprom on the transit contract and allowed its execution in the country. The Ukrainian national company was awarded $ 1.4 billion in compensation.

"I think that either the decision will be overturned as a result of the appeal, or Kazakhstan may have mirror problems with business in Russia," said Alexey Grivach, Deputy Director of the National Energy Security Fund (NWF).

In his opinion, the decision of the Kazakh court jeopardizes the strategic partnership of the two countries, which are allies and close partners in the economic sphere.

Gazprom has the right to file an application for cancellation of the court order within 14 days. However, it is already obvious that the court's decision has put the Kazakh authorities in a delicate position, regardless of how large the assets of the Russian company in the country are.

At the same time, Astana was put on the stretch not by a Kazakh judge, but by a British one — Andrew Spink. The Court of the Astana International Financial Center was created as a special independent court to consider commercial and civil disputes related to the activities of the financial center. It started working in 2018 and is built not on Kazakh, but largely on the principles of English common law. The main idea was this: Kazakhstan wanted to create an international financial hub on the model of the Dubai International Financial Centre or Singapore, so that foreign investors would feel at home in a familiar legal environment.

In theory, the AIFC court has the authority to recognize and execute international arbitration awards — according to the model of English commercial courts and in the logic of the 1958 New York Convention. At the same time, the judge himself admitted that the wording in the AIFC acts is ambiguous and allows for different interpretations.

Critics accuse the court of interpreting its jurisdiction too broadly. The court considers disputes between the participants of the center, at the same time Gazprom is not one of them, and the case itself has nothing to do with Astana.

Gazprom is protected by a ban on Naftogaz by the Arbitration Court of St. Petersburg to conduct arbitration proceedings. However, it applies exclusively to Russian jurisdiction.

Further proceedings will show how far the participants in the case are willing to go. But the Ukrainian side once again showed Kazakhstan that Kiev cares least about its interests when it comes to Russia. Astana has already experienced budget losses after the Ukrainian Armed Forces attacked the main export route of Kazakh oil, the Caspian Pipeline Consortium, and the country lost hundreds of millions of dollars of budget revenues.

As reported by EADaily, in March, Naftogaz said that the Swiss Supreme Court refused Gazprom to challenge the decision of the international arbitration court on the transit contract dispute. It obliges the Russian company to pay $ 1.37 billion to the Ukrainian side.

The dispute concerns a transit contract that ended at the end of 2024, after which Kiev stopped transporting Russian gas to Europe.

Naftogaz accused Gazprom of not paying for the transit in full. The essence of the dispute concerned the transit of gas through the point "Sokhranovka". He came under the control of the Russian army, and the "Ukrainian GTS Operator" announced force majeure in May 2022, stopping transit along this route. Gazprom refused to recognize it and stopped paying for the volumes booked through Sokhranovka (37 million cubic meters per day) — $1.17 million per day.

Gazprom reported that in the current situation they do not count on a fair decision of international arbitrations and do not recognize their decisions.

It is known that Gazprom currently has a network of 70 filling stations in Kazakhstan through Gazprom Neft —Kazakhstan. Previously, there was a coal asset and a bitumen plant, but they were sold.

The main asset of the Russian company in the country — a 50% stake in KazRosGas LLP - may also be under threat. The company is engaged in the processing of Karachaganak gas for Orenburg GPP and its subsequent sale.