The Public International Law Significance of the Ascom Case

Abstract

On November 18, 2021, the Swedish Supreme Court delivered its decision in the case of Ascom. Originating in an arbitral dispute under the Energy Charter Treaty, the case had become an opportunity for the court to contribute to the clarity of rules of the public international law on state immunity for the property of central banks and sovereign wealth funds.
            The dispute was between Kazakhstan and some foreign investors, resulting in an arbitral award in favor of the latter. Following failed attempts by the state to have the award set aside, the investors successfully requested the Swedish Enforcement Authority that the award be enforced. The district court upheld the decision. The Court of Appeal reversed it. Leave to appeal was granted by the Supreme Court, limited to the question of whether state immunity protected the attached property from enforcement.
           The property attached by the Enforcement Authority (financial instruments on a securities depository at a bank, receivables linked thereto, and funds on a cash account) was accumulated in and managed by the Kazakhstan central bank—the National Bank of Kazakhstan—as part of a sovereign wealth fund, the National Fund. The immunity protection for property belonging to a state’s central bank is consideredto be especially strong. There are, however, disagreements about the more precise content of this principle. The Supreme Court was thus called upon to determine this.