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INTEGRITES won a $190 mln ICAC arbitration

26/ 09/ 2019

INTEGRITES successfully represented interests of the Ukrainian state enterprise “Ukrkhimtransamiak”, one of the world major operators of ammonia pipeline, in arbitral proceedings against a Russian chemical giant Togliattiazot with over USD 190 mln at stake.

This case stemming from the long-term contract for ammonia transit through the territory of Ukraine was referred to arbitration under the Rules of the International Commercial Arbitration Court at the Ukrainian Chamber of Commerce and Industry (ICAC) in 2017. INTEGRITES’ client initiated these arbitral proceedings, while Togliattiazot filed several cross-claims. Both parties sought revision of the contractual tariff for ammonia transit through the Ukrainian part of the pipeline “Togliatti – Odessa”.

The negative outcome of the dispute could have affected the global ammonia market, because the ammonia pipeline has no market equivalent and remains the major means of transportation of ammonia produced and exported by Togliattiazot (i.e. about 11% of global ammonia exports).

INTEGRITES secured an unprecedented award revising the transit tariff sought by its client. They also helped the client defeat all cross-claims with economic effect exceeding USD 180 mln.

Supervised by partner and Head of International Arbitration Olena Perepelynska, the project team included senior associate Krystyna Khripkova and associate Anastasiia Iliashenko. Throughout the proceeding INTEGRITES team worked closely with the legal department and administration of “Ukrkhimtransamiak”.

“The case proved to be challenging and requiring analysis and application of not only the Civil and Commercial Codes of Ukraine, but of many provisions of the Tax Code of Ukraine, CIS customs convention, Ukraine-EU Association Agreement, The General Agreement on Tariffs and Trade (GATT), Vienna Convention on the Law of Treaties and many other Ukrainian laws and international treaties. Both the nature and complexity of the case make it unique among those considered by the ICAC”, – INTEGRITES partner Olena Perepelynska commented.

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