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Stockholm Arbitration Report (SAR)

Preview Page SAR 2003 - 2

Invest dispute. Enforcement of an award rendered under an investment agreement between Latvia and Sweden before Swedish courts and challenge of the same award before Danish courts.

SUMMARY

The dispute that was the subject of arbitration proceedings concerned a Swedish company, SwemBalt’s claim for compensation for the loss of a vessel, SJFW/SwedeBalt, that was registered in Sweden and leased to SwemBalt’s Latvian subsidiary, Swede Balt SIA. The vessel was positioned in the Port of Riga Latvia in April 1993, allegedly with permission from the relevant Latvian authorities. The vessel was to serve as an exhibition area and a conference centre. On 24 March 1994, Swede Balt established a contract of several years’ duration with the Kurzeme Region of Riga regarding the lease of a berth and an area of land. On 28 March 1994, a representative of the Port of Riga removed the vessel. No representatives of the owner were present. The vessel was towed to a berth two nautical miles from the leased berth. Numerous objections were made on the part of the owner and other parties. On 18 April 1994, Riga’s mayor informed SwemBalt that the lease, in accordance with a new Law with retroactive effect, had become invalid. In 1994 and 1995, there were numerous discussions, etc. between the Swedish embassy in Riga and various Latvian authorities, but these did not achieve anything.