The state has for the time being avoided a lawsuit for confiscating a talc quarry site in Gemerská Poloma from EuroGas, as EuroGas lawyers received a letter from Finance Minister Peter Kažimír one day before the January 30 deadkub.
“Minister Kažimír proposed that our lawyers should hold talks in order to look for options to settle the dispute,” Wolfgang Rauball, chairman of the EuroGas managing board said for the TASR newswire. “EuroGas is studying the proposal, and will respond later.”
EuroGas is demanding compensation of $1.65 billion (€1.22 billion) for what it describes as a thwarted investment. It has already indicated that if it doesn’t reach an agreement with Slovakia, it will take legal action at the International Centre for Settlement of Investment Disputes (ICSID).
The Finance Ministry press department confirmed for TASR that it responded to EuroGas on January 30. The state claims that EuroGas broke an agreement by failing to begin mining the talc within the stated period. “The Finance Ministry, due to the current situation, won’t comment on possible arbitration. No international investment arbitration has been launched so far,” read a ministry statement.
The proposal to initiate out-of-court talks is part of the negotiating tactics, according to Professor Christian Hausmaninger from Austrian solicitor’s office Hausmaninger Kletter. Hausmaninger said that Slovakia might win the dispute.
EuroGas has threatened legal action since 2010. Its subsidiary Rozmin claims that the Slovak authorities illegally deprived it of the quarry deposit in Gemerská Poloma. Rozmin has been engaged in a multi-year dispute concerning the mining rights with a company called VSK Mining. This company has invested in the mining site since 2008 based on a decision of the due District Mining Office in Spišská Nová Ves.
At first, in 2011, EuroGas demanded compensation of €500 million; one year later, a company called EuroGas Inc., registered in the US, also began claiming compensation. The overall amount has climbed to $1.65 billion. EuroGas asserted that its rights related to a trade agreement between the erstwhile Czechoslovakia and the US from 1991 have been violated. The Slovak Finance Ministry last year denied that any agreement had been broken. The talc deposit in Gemerská Poloma was discovered accidentally during a search for tin in 1985; it has high levels of purity.
Compiled by Zuzana Vilikovská from press reports
The Slovak Spectator cannot vouch for the accuracy of the information presented in its Flash News postings.
5. Feb 2014 at 10:00