The Ministry of Foreign Affairs of Turkmenistan today announced a complete victory in an international arbitration dispute with the Russian telecommunications company MTS (Mobile TeleSystems). The total amount of compensation in favor of Turkmenistan exceeded 11 million US dollars plus 589 thousand euros.
On June 27, the Svea Court of Appeal in Sweden finally rejected all claims of MTS and ordered the Russian company to pay Turkmenistan 589 thousand euros of additional court costs. The decision is final and is not subject to further appeal.
The dispute began in 2018, when MTS initiated international arbitration proceedings against Turkmenistan through the ICSID (International Center for Settlement of Investment Disputes) tribunal. The Russian company tried to challenge the expiration of its operating contract in the Turkmen telecommunications sector.
The ICSID Tribunal completely rejected all of MTS's claims on the merits and held that the operating contract was a legitimate commercial agreement under Turkmen law. The arbitrators confirmed that the contract had expired according to its terms and MTS was not entitled to request its extension.
After failing in the international arbitration, MTS tried to challenge the decision in Swedish courts, since the proceedings were held in Stockholm. However, even this attempt ended in a defeat for the Russian company.
The Foreign Ministry of Turkmenistan emphasized that this victory confirms the legitimacy of the country's actions in the field of telecommunications market regulation and protection of national interests in international legal instances.
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