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Knezevic warns Darmanovic he will sue the state before the international court of arbitration

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Total Montenegro News | 29 August 2020

Knezevic warns Darmanovic he will sue the state before the international court of arbitration

By Antonela Stjepčević

August 29, 2020 - Dusko Knežević’s legal representatives have warned the representatives of the executive authorities that, if the Government does not compensate the businessman, they will sue the state before the International Court of Arbitration. In the event of a favorable outcome for the Atlas Group President, property belonging to Montenegro may be transferred to him, states a letter to the Minister of Foreign Affairs Srdjan Darmanovic sent by Knežević’s legal representatives Gary B. Born and Steven P. Finizio. Darmanovic was reminded that they had sent him a previous notice of the dispute a year ago.

"In the Notice of Dispute sent to you in August 2019, Dr.Knežević suggested a conversation in good faith to achieve a fair resolution of these accusations. Dr.Knežević’s proposal to initiate talks in good faith was following Article 9 of the Agreement, which stipulates that after receiving such a notification, the Government must meet with the investor and make efforts to resolve these disputes amicably where possible. Despite this, the Government ignored the Notice of Dispute by not answering at all the serious questions raised in the Notice, not to mention that it did not join the talks in good faith following the Agreement," reads the new letter sent to Minister Darmanović.

They recall that the Government has violated its obligations under the Bilateral Investment Agreement between Cyprus and Montenegro, which has caused "growing and permanent damage" to Knezevic and his investments, which exceeds 500,000,000 euros. They emphasized that by this Agreement, Knežević and the Atlas Group’s affected companies have the right to initiate arbitration proceedings against Montenegro, according to the arbitration rules of UNCITRAL, ICC or ICSID.

"If lawsuits against Montenegro are filed under UNCITRAL or ICC rules, the proceedings will be conducted before an international tribunal sitting in a neutral jurisdiction and under the courts’ supervision in that jurisdiction. Among other things, that international court will have the authority to order the Government to disclose documents relating to the measures it has taken against Dr.Knežević. Also, Montenegro would be obliged to comply with any judgment issued by that court. Suppose Montenegro refuses to do so by failing to comply with its contractual obligations. In that case, the decision may be enforced on Montenegro’s property, among other things, following the Convention on the Recognition and Enforcement of Foreign Arbitral Awards," they stressed.

They point out that the situation is similar if the lawsuits are resolved through arbitration according to ICSID rules - the tribunal will have the authority to order the Government to disclose documents related to the measures it has taken against Knežević. Montenegro will be obliged to abide by the verdict against it that can be enforced globally against Montenegro’s property following the Convention on the Settlement of Investment Disputes between States and Nationals of Other States. They emphasized that Knežević still wishes to start talks to reach a fair and constructive solution to the dispute, and therefore, it provides the Government with another opportunity:

"If the Government does not respond and agree to the talks within 60 days, Dr.Knežević will have no choice but to conclude that the Government does not wish to discuss the issue in good faith and to start arbitration following the Agreement."


 source: Total Montenegro News