Kazakhstan’s government and its main creditor have reached a settlement to resolve a 14-year legal dispute. Both parties believe this resolution could enhance the country’s investment potential.
The Stati Case, which began in 2010, involved a claim by companies owned by Moldovan businessman Anatol Stati and his son Gabriel against Kazakhstan’s government for seizing their business. In 2013, the arbitration court ordered Kazakhstan to pay $500 million plus legal fees to the Stati parties. However, the government refused to comply, violating the Energy Charter Treaty principle it had adopted to attract investments.
This dispute led to the freezing of $22.6 billion in national fund assets in 2017 and limitations on certain state-owned assets in Europe. Last year, a Swedish court ordered Kazakhstan to pay $75 million plus court fees to the Stati parties.
The recent settlement between Kazakhstan and the Stati parties, according to the Kazakh Ministry of Justice, does not involve public funds and aims to serve the public interest.
Argentem Creek Partners, a U.S.-based bondholder, expressed satisfaction with the settlement, noting that it demonstrates Kazakhstan’s compliance with international treaty obligations.
The statement also praised President Kassym-Jomart Tokayev’s leadership and the reforms planned under his administration.
While the past regime under President Nursultan Nazarbayev was blamed for the asset seizure, the focus now is on honoring obligations and moving forward with the settlement.
The transition from the old guard to the new leadership in Kazakhstan has been marked by legal battles and reshuffling of key figures, including the dismissal of Minister of Justice Marat Beketayev.
Beketayev’s involvement in the Stati Case and alleged corruption led to his detention and pending trial. The new leadership seeks to distance itself from past controversies.
The future of Kazakhstan’s legal and political landscape remains uncertain as it navigates through the aftermath of past disputes and power struggles.