The arbitration UNCITRAL was commenced under the Ukraine-Russia Bilateral Investment Treaty.Russian Federation States that it does not recognize the jurisdiction of the tribunal and fails to submit statements of defense; hearing scheduled for 11 July 2016, -  was informed in press release of Permanent Court of Arbitration (the "PCA"), which is located in the Hague.

It is commonly known, that PJSC Ukrnafta commenced arbitration to recover compensation from the Russian Federation for the unlawful seizure of PJSC Ukrnafta’s petrol station operations in the Crimean Peninsula following the Russian Federation’s occupation and purported annexation of the Autonomous Republic of Crimea and city of Sevastopol in 2014.  The arbitration is brought under the 1998 bi-lateral investment treaty between Ukraine and the Russian Federation, under which each state promised not to nationalize or expropriate investments made by investors from the other state without prompt and fair compensation.  In spite of a formal demand from PJSC Ukrnafta, the Russian Federation has refused to pay any compensation for the taking of its petrol stations and other property in Crimea and Sevastopol.

On 15 January 2016, Ukrnafta filed its statements of claim. The Russian Federation failed to submit its Statements of Defense by 15 April 2016, the deadline fixed in the procedural timetable

On 22 April 2016, the tribunal ordered, pursuant to article 28(1) of the UNCITRAL rules, that both proceedings continue notwithstanding the Russian Federation’s failure to communicate statements of defense.

As foreseen in the procedural timetable, the Tribunal posed questions to the Parties with respect to issues of jurisdiction on 22 April 2016. The Parties’ answers to the Tribunal’s questions are due by 3 June 2016. A hearing on issues of jurisdiction has been scheduled to take place on 11 July 2016.

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