Lithuania Seeks Arbitration Review

Lithuania’s energy ministry has submitted an appeal to a Stockholm Appellate Court seeking to override the  Swedish Arbitration Institute’s June 2016 ruling on a gas dispute with Gazprom. Lithuania had sought €1.5bn in compensation for overcharges between 2006 and 2015, but failed to convince.

“We are doing it because we at the ministry think that the [SAI] ruling was not in Lithuania’s interests, therefore the attempt to have it overridden at the Appeals institution,” Mantas Dubauskas, a senior advisor to Lithuania’s energy minister Rokas Masiulis, explained to NGW.

Lithuania ascribed its failure to convince the court to being unable to show a specific breach of the agreement between Lietuvos Dujos and Gazprom, the Russian exporter bought into the company. The agreement was couched in abstract terms and conditions, saying that Gazprom would supply gas at a fair price. But since then, Lithuania argued, the gas price formula has changed several times, while buyers in Estonia and Latvia have since seen price cuts.

However experts are not hopeful that Lithuania will win, with one describing its chances as “close to zero. First, there’s no practice to appeal arbitral rulings. Second, as plaintiff, Lithuania has not provided any evident procedural infringements in the deliberations at the SCC. Third, I haven’t heard of any new arguments to the case and, fourth, the whole thing now seems as the outgoing Lithuanian Government’s endeavor to patch up its incapability at the SCC Arbitration. The decision to get its ruling reviewed has obviously been driven by some political motifs of which I can speculate,” Arvydas Sekmokas, a former Lithuanian energy minister, told NGW.

Linas Jegelevicius