Are the Armenian authorities ready to quarrel with the U.S.?
Read on the website Vestnik Kavkaza Author: Susanna Petrosian, Yerevan, exclusively to VK
In September, the judgment of the court of the Southern District of New York on collecting 37 million 537 thousand 978 dollars from ex-Minister of the Environment Vartan Aivazian in favor of an international gold mining company, Global Gold Mining (GGM), came into effect.
According to the available materials of the court verdict, in 2006, one of the subsidiaries of GGM, which had a license to develop a gold mine in Hankavan, faced corrupt and inappropriate requirements from Aivazian. The company reported this to the appropriate authorities of Armenia and the United States. As a result, GGM lost control over the mine. Vartan Aivazian himself is now a member of the National Assembly from the ruling Republican Party of Armenia (RPA) and the head of the permanent parliamentary commission for the economy; he considers this fine to be absurd and does not see any legal consequences in the verdict of the American court.
Aivazian, who in 2001-2007 served as Minister of Environment, says that his decision to revoke the license of GGM was correct, as the company failed to comply with laws and its own obligations. According Aivazian, he did not act as an individual, but as a minister, and he was protecting the interests of the state. The ex-minister is shocked that his case has been investigated in the U.S., not in Armenia. "Even if a wrong decision was made at the time, I must be responsible for it before the Republic of Armenia, and not before the court of the Southern District of New York," Aivazian said and advised GGM to apply to the Armenian Administrative Court, and if the claim is not sustained – to European courts.
In turn, the representative of the Global Gold Mining in Armenia, Ashot Poghosyan, said that under the agreement made between the three shareholders of the GGM, the Court of the Southern District of New York was chosen as a court of law to resolve the disputes. In accordance with the law of New York, the court considered Aivazian to be a hidden party to the conflict. "All documents relating to the trial, including the verdict, were thoroughly sent to Aivazian, but he did not respond to that, and did not exercise his right to appeal the verdict," Ashot Poghosyan said. According to him, the court has already handed the writ of the National Service for execution.
The roots of today's scandal lie in 2005, when the international corporation GGM, registered in the U.S., acquired a license for the development of several gold mines in Armenia, including a mine in Hankavan. This license was revoked by the Minister of the Environment. GGM representatives led documentary evidence that they did not violate their obligations and worked in the fully legal field. The media also leaked information that the Minister of Environment asked the company representatives for a bribe of three million dollars, and that refusal to provide the requested amount was the cause of the scandal. It is likely that leakage of this information was organized by the company. Then, despite numerous publications in the media, which openly said that Ayvazyan asked foreign companies for bribes, the minister never tried to appeal against such claims.
"Speak to those people who said that I was offered a bribe. Suppose that at least one person will say that I demanded money, and I will be able to appeal this claim. As a Minister, I applied administrative proceedings. I revoked their licenses. May they come to our Court of Justice and the court may say:"Mr. Aivazian, you made a mistake." Operating according to their own interests, they are trying to smear my reputation," the ex-minister said.
There are several publications of the website Wikileaks noteworthy in this regard, which, with reference to the dispatch of U.S. Ambassador to Armenia John Evans say: "According to the information of the company GGM, in July 2005, the Minister of Environmental Protection Vardan Aivazian notified the company lawyer Ashot Poghosyan that the company had to pay a bribe of $3 million to his close associate and MP Murad Guloyanu. GGM refused to pay the bribe, and soon the Ministry revoked the licenses of the two mines of the company in Armenia. GGM argued that due to its refusal to pay a bribe, the Minister refused to issue a license, for which GGC had all the rights, issued duplicates of the license to mines owned and developed by GGM to other companies, and generally obstructed GGM in the conduct of its business. "
Some observers believe that the writ issued by the court of New York cannot be executed, because there is no bilateral intergovernmental agreement between Armenia and the U.S. on recognition and enforcement of judicial decisions. "As long as there is no decision of the International Court of Arbitration on this case, this act cannot be performed. The arbitration shall apply to the authorities of Armenia, so that they recognize and accept the decision. But in the case of the arrival of Vartan Aivazian in the U.S., he will be under the jurisdiction of the U.S.," lawyer Ara Ghazaryan says.
However, the former Ambassador of Armenia to Canada, Ara Papian, believes that the U.S. can apply to Interpol, which means that in case of default of payment Aivazian can be arrested in 190 countries; besides, the United States may apply to the Armenian authorities on this matter.
In a recent interview with the electronic edition 1in.am, the CEO of GGM, U.S. citizen Van Krikorian, did not rule out that the case may be referred to the U.S. State Department; he also reported that his lawyers could make such a decision.
Given the strict attitude of international institutions to the protection of foreign investments, future developments are to be expected. Systematic steps to protect their rights and the fight against the phenomenon of corruption in Armenia "openly" speak in favor of GGM. After 20 years of independence of Armenia there have been many cases when foreign investors, including representatives of the Armenian diaspora, experienced corruption pressure from local government officials. But none of the foreign visitors came out to fight openly, most preferred to arrange leaks to the media and to leave Armenia. It is also clear that the leadership of GGM has well thought through all the possible mechanisms, and the case is hardly likely to come to a legal impasse.
Now, for the first time in the last 10 years, the interests of a senior official (a deputy from the ruling party) are affected, and this category hitherto enjoyed immunity and permissiveness in Armenia. Now the government will have to choose between the relationship with the U.S. and Vartan Aivazian.
In September, the judgment of the court of the Southern District of New York on collecting 37 million 537 thousand 978 dollars from ex-Minister of the Environment Vartan Aivazian in favor of an international gold mining company, Global Gold Mining (GGM), came into effect.
According to the available materials of the court verdict, in 2006, one of the subsidiaries of GGM, which had a license to develop a gold mine in Hankavan, faced corrupt and inappropriate requirements from Aivazian. The company reported this to the appropriate authorities of Armenia and the United States. As a result, GGM lost control over the mine. Vartan Aivazian himself is now a member of the National Assembly from the ruling Republican Party of Armenia (RPA) and the head of the permanent parliamentary commission for the economy; he considers this fine to be absurd and does not see any legal consequences in the verdict of the American court.
Aivazian, who in 2001-2007 served as Minister of Environment, says that his decision to revoke the license of GGM was correct, as the company failed to comply with laws and its own obligations. According Aivazian, he did not act as an individual, but as a minister, and he was protecting the interests of the state. The ex-minister is shocked that his case has been investigated in the U.S., not in Armenia. "Even if a wrong decision was made at the time, I must be responsible for it before the Republic of Armenia, and not before the court of the Southern District of New York," Aivazian said and advised GGM to apply to the Armenian Administrative Court, and if the claim is not sustained – to European courts.
In turn, the representative of the Global Gold Mining in Armenia, Ashot Poghosyan, said that under the agreement made between the three shareholders of the GGM, the Court of the Southern District of New York was chosen as a court of law to resolve the disputes. In accordance with the law of New York, the court considered Aivazian to be a hidden party to the conflict. "All documents relating to the trial, including the verdict, were thoroughly sent to Aivazian, but he did not respond to that, and did not exercise his right to appeal the verdict," Ashot Poghosyan said. According to him, the court has already handed the writ of the National Service for execution.
The roots of today's scandal lie in 2005, when the international corporation GGM, registered in the U.S., acquired a license for the development of several gold mines in Armenia, including a mine in Hankavan. This license was revoked by the Minister of the Environment. GGM representatives led documentary evidence that they did not violate their obligations and worked in the fully legal field. The media also leaked information that the Minister of Environment asked the company representatives for a bribe of three million dollars, and that refusal to provide the requested amount was the cause of the scandal. It is likely that leakage of this information was organized by the company. Then, despite numerous publications in the media, which openly said that Ayvazyan asked foreign companies for bribes, the minister never tried to appeal against such claims.
"Speak to those people who said that I was offered a bribe. Suppose that at least one person will say that I demanded money, and I will be able to appeal this claim. As a Minister, I applied administrative proceedings. I revoked their licenses. May they come to our Court of Justice and the court may say:"Mr. Aivazian, you made a mistake." Operating according to their own interests, they are trying to smear my reputation," the ex-minister said.
There are several publications of the website Wikileaks noteworthy in this regard, which, with reference to the dispatch of U.S. Ambassador to Armenia John Evans say: "According to the information of the company GGM, in July 2005, the Minister of Environmental Protection Vardan Aivazian notified the company lawyer Ashot Poghosyan that the company had to pay a bribe of $3 million to his close associate and MP Murad Guloyanu. GGM refused to pay the bribe, and soon the Ministry revoked the licenses of the two mines of the company in Armenia. GGM argued that due to its refusal to pay a bribe, the Minister refused to issue a license, for which GGC had all the rights, issued duplicates of the license to mines owned and developed by GGM to other companies, and generally obstructed GGM in the conduct of its business. "
Some observers believe that the writ issued by the court of New York cannot be executed, because there is no bilateral intergovernmental agreement between Armenia and the U.S. on recognition and enforcement of judicial decisions. "As long as there is no decision of the International Court of Arbitration on this case, this act cannot be performed. The arbitration shall apply to the authorities of Armenia, so that they recognize and accept the decision. But in the case of the arrival of Vartan Aivazian in the U.S., he will be under the jurisdiction of the U.S.," lawyer Ara Ghazaryan says.
However, the former Ambassador of Armenia to Canada, Ara Papian, believes that the U.S. can apply to Interpol, which means that in case of default of payment Aivazian can be arrested in 190 countries; besides, the United States may apply to the Armenian authorities on this matter.
In a recent interview with the electronic edition 1in.am, the CEO of GGM, U.S. citizen Van Krikorian, did not rule out that the case may be referred to the U.S. State Department; he also reported that his lawyers could make such a decision.
Given the strict attitude of international institutions to the protection of foreign investments, future developments are to be expected. Systematic steps to protect their rights and the fight against the phenomenon of corruption in Armenia "openly" speak in favor of GGM. After 20 years of independence of Armenia there have been many cases when foreign investors, including representatives of the Armenian diaspora, experienced corruption pressure from local government officials. But none of the foreign visitors came out to fight openly, most preferred to arrange leaks to the media and to leave Armenia. It is also clear that the leadership of GGM has well thought through all the possible mechanisms, and the case is hardly likely to come to a legal impasse.
Now, for the first time in the last 10 years, the interests of a senior official (a deputy from the ruling party) are affected, and this category hitherto enjoyed immunity and permissiveness in Armenia. Now the government will have to choose between the relationship with the U.S. and Vartan Aivazian.