On 23 March 2018, the District Court denied Kazakhstan’s motion for reconsideration and confirmed the 500 million dollars award under the Energy Charter Treaty in favor of the Moldavian investors regarding oil use rights in Kazakhstan. When the investors sought enforcement in the United States, Kazakhstan opposed it on the grounds of fraud alleging that the investors inflated the value of their investment and manufactured expert evidence to support their claim. The Court denied the State’s motion finding that the arbitrators had expressly disavowed any reliance of the allegedly fraudulent material and relied on third party bids to estimate damages.
In its motion for reconsideration, Kazakhstan not only maintained that the award was tainted by fraud but so was the bid. The Court refused to consider the latter argument as it was not presented in the initial motion and found that there was no error of facts. The Court also found no error in law when it required a showing that the arbitral tribunal relied on the alleged fraudulent material.
After denying the Respondent’s motion for reconsideration, the Court proceeded to confirm the SCC arbitral award finding that none of the grounds raised by Kazakhstan under article V of the New York Convention met their burden. As such the Court rejected several other arguments finding that the cooling off period under the ECT is a jurisdictional requirement and not a procedural one and that Kazakhstan had been given adequate notice to appoint an arbitrator and that the only reason it did not appoint one was the result of a “lack of timely participation on its part.”