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Slovakia Won Arbitration Dispute with Achmea

26. 05. 2014

The arbitral tribunal announced that the design and implementation of its public health policy is for the State alone to assess. Moreover, it stated that it is not empowered to intervene in the democratic process of a sovereign state and concluded that it has no jurisdiction over the dispute.

The Dutch company Achmea B.V. (shareholder of UNION health insurance company Inc.) claimed alleged breaches of the Treaty on encouragement and reciprocal protection of investments between the Czech and Slovak Federal Republic and the Kingdom of the Netherlands. According to Achmea, the Slovak Republic breached the Treaty because it intends to establish a single health insurance company. Further, Achmea B.V. claimed that its investment was damaged by the conduct of 17 state-owned hospitals during the negotiations of contracts on healthcare provision, as well as by the purported general instability of the regulatory environment in health insurance. The amount of damage sought by Achmea B.V. was to be specified at a later stage of arbitration proceedings. 

The arbitral tribunal dismissed all of Achmea’s claims.  It also ordered Achmea B.V. to pay to the Slovak Republic the legal costs in the amount of EUR 1.011 mil. as well as the costs of tribunal in the amount over EUR 340 thousand. The costs of the Slovak Republic in the arbitration have been so far EUR 1.348 mil. The Slovak Republic was represented by the arbitration team of Squire Sanders.

Up to date the Slovak Republic did not lose any international arbitration based on international investment agreements.