Naftogaz defeated Gazprom in Switzerland: what is known about the $1.37 billion arbitration
23 June 2025 21:31
The National Joint Stock Company Naftogaz of Ukraine has won another legal victory over the Russian gas monopoly Gazprom. The Chairman of the Board of Naftogaz of Ukraine, Sergiy Koretsky, wrote about this on his official Facebook page, "Komersant Ukrainian" reports.
He said that the International Arbitration Tribunal in Switzerland had made a final decision in the case, ordering Gazprom to pay $1.37 billion in favor of Naftogaz.
The case concerned Gazprom’s failure to fulfill its contractual obligations under the take-or-pay principle, which were stipulated in the contract for gas transit through Ukraine. Since May 2022, Gazprom has stopped fulfilling its part of the obligations. In particular, it completely blocked payment for the booked transit capacities provided for by the existing agreements between the parties.
This violation was the basis for the start of the arbitration process: in September 2022, Naftogaz filed a lawsuit against Gazprom in the International Arbitration Court to force the company to comply with the terms of the contract.
“Gazprom tried to prevent the case from being heard by asking Russian courts to ban Naftogaz from participating in the international process. However, these attempts had no legal effect on the tribunal’s decision. The arbitration continued in accordance with international law.
The process was conducted under the rules of the International Chamber of Commerce (ICC) in Geneva. The tribunal was composed of independent arbitrators from Sweden, Switzerland and Israel, which ensured a high level of impartiality and professionalism.
In his post, Chairman of the Board Sergiy Koretsky emphasized the significance of this victory from both a legal and political point of view.
“This is an important victory. I sincerely thank the professional team of lawyers of Naftogaz and our legal advisors Wikborg Rein for this result,” Koretsky wrote.
What’s the future?
The arbitral award is final and binding. However, a legal victory is only the first step. The next step is to enforce the award if Gazprom refuses to comply with the decision voluntarily. To this end, Naftogaz is already preparing legal actions in jurisdictions where Gazprom’s assets may be located (in particular, in Europe).
The next step is to ensure the enforcement of the decision. We will work on this. Step by step,” Koretsky said.
Context: Russian aggression and attempts at economic pressure
Since the beginning of Russia’s full-scale invasion of Ukraine in February 2022, Gazprom has repeatedly used gas as an instrument of political and economic pressure. Reducing or completely stopping transit, manipulating payments for transit capacities – all of these have become elements of the Kremlin’s aggressive energy policy.
At the same time, Ukraine, in compliance with its obligations, continues to ensure reliable gas transit to the European Union, fulfilling its role as a responsible partner.
Naftogaz’s victory in court is yet another case that confirms that even in wartime, Ukraine is able to successfully defend its interests in the international arena.
This decision has not only financial but also reputational significance for Ukraine. It demonstrates that even in difficult periods, the country continues to defend its rights in the legal field, using all available instruments of international justice.
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