ArmInfo. The arbitration proceedings regarding the expropriation of Electric Networks of Armenia (ENA) have moved on to considering Armenia's jurisdictional objections.
On June 16, 2026, the arbitral tribunal presiding over the investment dispute regarding the ENA expropriation issued a procedural order to bifurcate the proceedings into two separate stages. This was announced in a statement released on behalf of the legal team for "Liormand Holdings Limited," a shareholder of ENA.
In the first stage, the arbitration will consider the jurisdictional objections presented by the Armenian government. After this stage, the tribunal will move to consider the dispute on its merits, including issues regarding the legality of the state's actions and liability for the expropriation of investments. Bifurcation is a common practice in international investment disputes involving a large number of contentious issues. At the same time, this decision is purely procedural in nature and does not indicate that the tribunal has deemed Armenia's arguments to be well-founded or subject to satisfaction.
On the other hand, in its decision dated June 16, 2026, the arbitrators explicitly stated that for the purposes of this decision, the tribunal is not required to rule on the merits of these objections; moreover, had it done so, the tribunal would be subject to legitimate criticism for purportedly proceeding to an improper and premature assessment of the validity of these objections. Thus, the question of the validity of the Armenian government's jurisdictional objections remains open and will be a subject of separate consideration.
The decision to bifurcate the proceedings does not predetermine the outcome of this stage and cannot be viewed as a confirmation of the state's legal position. However, the bifurcation, initiated at the request of the Armenian government, may lead to a significant increase in the duration and cost of the arbitration process. In the event that the tribunal rejects all jurisdictional objections and upholds the investor's claims on their merits, the additional costs resulting from the two-stage consideration of the case may be imposed upon Armenia.
The investors continue to seek full protection of their rights in international arbitration and are confident in the validity of the claims filed in connection with the investments being seized/expropriated from them.
The interim measures imposed last July, prohibiting Armenia from taking any actions aimed at the alienation of ENA, remain in effect. Accordingly, any further unlawful actions by the Armenian government against ENA and its shareholders, including the nationalization of the company, would violate these measures and entail Armenia's international legal liability, the statement reads.
Recall, in early March 2025, the Armenian government decided to fully nationalize Electric Networks of Armenia, a company owned by leading opposition politician Samvel Karapetyan. In November 2025, the Public Services Regulatory Commission (PSRC) of Armenia revoked ENA's electricity distribution license. PSRC Chairman Mesrop Mesropyan stated that the government would negotiate with ENA's board of directors by the end of February 2026 regarding the transfer of ownership rights to the property. Ruling party member Romanos Petrosyan was appointed interim manager of ENA to coordinate the divestiture process and ensure the company's smooth operation.
The case is being heard in the Stockholm Arbitration Tribunal, a lawsuit brought by the company's owners (the family of businessman Samvel Karapetyan and Liormand Holdings Limited) against the Armenian government. In July 2025, immediately after the nationalization process began, the arbitration court issued interim measures and temporarily prohibited Armenia from seizing the assets of the Electric Networks of Armenia (ENA). However, the government did not comply with this interim decision. In January 2026, the Stockholm International Tribunal completely rejected the strict interim measures requested by the plaintiffs. The owners demanded the return of the license and the reinstatement of the previous management. The court found their demands unfounded, allowing Armenia to continue the proceedings. In June, the arbitration court agreed to sever the case and first consider whether the arbitration court even has jurisdiction to hear the dispute. Official Yerevan argues that the plaintiffs violated international agreements and cannot be considered legitimate investors for such a court.
