Sayenko Kharenko is pleased to share a favourable outcome for Ukraine in the ICSID arbitration Gilward Investments B.V. v. Ukraine (ICSID Case No. ARB/15/17), where our team acted as legal counsel to the State of Ukraine working alongside the Ministry of Justice of Ukraine and international law firm Latham & Watkins LLP.
The arbitration was brought by Gilward Investments B.V., a Netherlands-based entity ultimately controlled by a Ukrainian-Israeli oligarch and a Russian-Ukrainian businessman. Claimant was the shareholder in PrJSC “Aerosvit Airlines” (Aerovsit), which was once Ukraine’s largest commercial airlines before 2013.
The dispute arose from the Claimant’s claim that Ukraine’s actions led to the collapse of Aerosvit resulting in USD 947 million in damages and interest (increased by the Claimant in late 2024 from the original claim of approximately USD 700 million). The Claimant alleged various violations such as denial of access to international flight routes, preferential treatment of competing airlines, expropriation of land, delays in VAT refunds and state interference in bankruptcy proceedings in respect of Aerosvit.
In March 2024, Ukraine submitted a comprehensive defence supported by extensive fact and expert evidence demonstrating that the Aerosvit’s bankruptcy was driven by internal mismanagement and financial misconduct and not from any unlawful conduct by the State.
By late 2024, the Claimant had not substantively addressed many elements of Ukraine’s defence on the merits.
Following repeated procedural delays and the Claimant’s failure to pay advance on costs, the Tribunal first stayed the proceedings in January 2025 and then discontinued the case on 6 August 2025 pursuant to ICSID Administrative and Financial Regulation 14(3)(d). This has concluded a decade-long arbitration against Ukraine initiated in 2015.
This outcome reinforces the strength of Ukraine’s legal position and marks a significant victory in defending the State against unsupported investment treaty claims.
We are proud to have supported the Ministry of Justice of Ukraine and Latham & Watkins in achieving this result for Ukraine and are grateful for the effective cooperation.
Sayenko Kharenko team was led by partner Olexander Droug and included special advisor Tatyana Slipachuk, senior associates Alina Bahan and Vladyslav Bandrovsky, and associates Katalina Shkuro, Maksym Melnyk and Henrietta Yaitska.
