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Canadian Court Freezes Kyrgyz Shares in Centerra at Latvian Banker Request

Wednesday 4 March 2015

BISHKEK (TCA) – The Canadian province of Ontario’s Superior Court of Justice has frozen Kyrgyzstan’s shares worth CAD20.5 mln in Canada’s Centerra Gold mining company, ruling in favor of Latvian businessman Valery Belokon over the nationalization of his Manas Bank in Kyrgyzstan, Latvian media reported on Tuesday with reference to Belokon Holding.

The Latvian company said that Belokon had applied to the Canadian court after Kyrgyzstan’s government had not performed the ruling of the UN’s international court of arbitration in Paris which ordered the Kyrgyz government to pay US $16.5 mln to Belokon to compensate for his bank’s nationalization.

According to Belokon Holding, the Canadian court will now decide on enforced implementation of the arbitration court’s decision in Canada, given that in line with the UN New York convention, in case the losing party in a dispute misses the compliance deadline, the winning party may obtain an enforced implementation of the court decision, turning against the country’s assets in any member state of the convention.

In October 2014 the international court of arbitration in Paris ruled that the Kyrgyz government has to pay US $16.5 mln to Belokon for the nationalization of Manas Bank in Kyrgyzstan.

Belokon had filed a lawsuit against the Kyrgyz government over the nationalization of his Manas Bank in Kyrgyzstan, demanding compensation for the loss of the bank. Kyrgyzstan’s interim government, which came to power after the ouster of President Kurmanbek Bakiyev in April 2010, took over five commercial banks in Kyrgyzstan, including Manas Bank. The government then explained the move by the need to prevent outflow of funds from bank accounts linked with ousted President Bakiyev and other former state officials. A criminal case was launched in Kyrgyzstan against Belokon, the key owner of Manas Bank.

The ruling regarding Manas Bank is one of several rulings of international arbitration courts that order the government of Kyrgyzstan to pay a total of a billion in US dollars to foreign companies.

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