EuroGas Fails for Now in International Arbitration with Slovakia for Talc

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Rauball on result of talc mining licence arbitration (photo by TASR)

Bratislava, August 22 (TASR) – EuroGas has failed for now in its arbitration proceedings with Slovakia concerning the allegedly illegal withdrawal of a licence for talc mining in Gemerska Poloma (Kosice region), EuroGas managing board chairman Wolfgang Rauball has admitted on the company’s website.

“The International Centre for Settlement of Investment Disputes (ICSID) ruled last week that it’s not in its jurisdiction to decide on the case, thus giving Slovakia the ruling. Article 52 of its statutes, however, enables a request for the decision to be annulled and we want to make use of this clause,” Rauball told TASR on Tuesday.

A 120-day period starts as of the day the request is submitted. “A commission will then make a definitive decision as to whether the tribunal’s verdict can be annulled or not,” said Rauball, adding that further relevant information in the case will be known by the end of the week. If EuroGas eventually suffers a definitive loss, it plans to file a lawsuit at the U.S. federal court against the Austrian company Schmid Industrieholding (SIH) and its subsidiary Eurotalc, which holds the Slovak talc mining licence in Gemerska Poloma. “We have collected enough evidence of criminal behaviour from the SIH owners and their links to the state mining authorities in Slovakia that have been damaging EuroGas and its shareholders for many years,” stressed Rauball.

Robert Schmid, owner of SIH, repeatedly rejected Rauball’s accusations. “Mr. Rauball likes to attack everyone, including me, the Slovak Republic, the mining authorities. I find all this to be constructions fabricated by him, and I don’t want to comment on them,” Schmid told TASR in reaction.

EuroGas AG has been threatening Slovakia with arbitration proceedings since 2010. As the petitioner in the arbitration, which was launched in 2014, EuroGas is demanding compensation of $3.2 billion (€2.9 billion) from Slovakia for what it calls a marred investment. No appeal against ICSID decisions is possible, although they can be overturned due to serious procedural flaws.

EuroGas began indicating its plans to take legal action against Slovakia over the loss of the talc quarry in 2010. At first, it demanded compensation of €500 million in 2011. One year later a company called EuroGas Inc., registered in the USA, also began claiming compensation. The total sum of required compensation has thus climbed to €1.5 billion. EuroGas asserted that its rights related to a trade agreement between the erstwhile Czechoslovakia and the USA from 1991 had been violated. The Slovak Finance Ministry has denied that any such agreement was broken.