Arbitration Tribunal Halts Armenian Government’s Nationalization Efforts

The Stockholm arbitration tribunal has issued a ruling that prevents the Armenian government from proceeding with the nationalization of a major electricity company owned by Samvel Karapetyan, a jailed Russian-Armenian billionaire. This decision comes in the wake of Karapetyan’s arrest in June 2025 on allegations of inciting power seizures, following his public support for the Armenian Apostolic Church in its ongoing dispute with the government led by Prime Minister Nikol Pashinyan.

In the aftermath of Karapetyan’s detention, Prime Minister Pashinyan called for the nationalization of Electric Grids of Armenia, the firm controlled by Karapetyan. Subsequently, the Armenian parliament enacted legislation that would allow the state to confiscate the company. In response, Karapetyan’s family filed a lawsuit with the Arbitration Institute of the Stockholm Chamber of Commerce, invoking a bilateral investment treaty established in 1995 between Armenia and Cyprus.

On Tuesday, the tribunal ruled that the Armenian government must refrain from enforcing the new laws or taking steps to seize the company. The tribunal emphasized that such actions could impede Karapetyan’s family from recovering damages should they lose control of the business. This ruling is binding, meaning the Armenian government is legally obligated to comply.

Political Context and Implications

Karapetyan’s case is part of a broader crackdown on opposition figures in Armenia. The arrests include prominent church officials, such as Archbishop Bagrat Galstanyan and Bishop Mikael Ajapakhyan, as well as opposition lawmaker Artur Sarkisyan, who faces coup conspiracy charges. These developments follow mass protests in Armenia, where demonstrators accuse Pashinyan of undermining national interests by conceding border territories to Azerbaijan. The prime minister defends these actions as necessary for fostering normalized relations with Baku.

The situation has drawn attention from Russia, particularly regarding Karapetyan, who is a Russian citizen. Kremlin spokesperson Dmitry Peskov noted that while the unrest is an internal matter for Armenia, Moscow hopes for stability and prosperity in the region, emphasizing the importance of maintaining friendly ties with Armenia.

As the legal battle continues, the ramifications for both Karapetyan and the Armenian government are significant. The tribunal’s decision not only protects Karapetyan’s business interests but also raises questions about the government’s approach to dissent and the implications of recent legislative actions on foreign investments in Armenia.