According to the website of the International Centre for Settlement of Investment Disputes (ICSID), which operates under the World Bank, on August 21, 2025, the appellate tribunal rejected Georgia’s appeal and upheld the original ruling delivered on October 27, 2022. Under that ruling, Georgia must pay $ 76 million in compensation to the Russian energy company Inter Rao for damages incurred.
The case stems from two arbitration disputes initiated in 2017 by Inter Rao’s subsidiaries against Georgia, with total compensation claims reaching $ 200 million. The first case was heard by the Arbitration Institute of the Stockholm Chamber of Commerce, while the second was handled by ICSID. The Stockholm tribunal issued its decision on September 9, 2022, ordering Georgia to pay $ 112 million in compensation to Inter Rao. Shortly after, on October 27, 2022, ICSID issued its ruling, requiring Georgia to pay an additional $ 76 million to Inter Rao, noting that this amount was included within the $ 112 million awarded in Stockholm.
The Georgian side appealed both rulings. However, as of August 21, 2025, ICSID’s appellate tribunal rejected Georgia’s request to partially annul the $ 76 million award, leaving the October 27, 2022 decision in force. The Stockholm arbitration appeal regarding the $ 112 million award remains unresolved, but with the ICSID ruling, Georgia has definitively lost $ 76 million.
It remains unclear whether the compensation amount includes accrued interest for late payment. If interest was stipulated in the award, the $ 76 million determined in 2022 could now be tens of millions of dollars higher.
BMG has requested a comment from the Ministry of Justice’s press office and will provide an update once a response is received.
Background:
Inter Rao owns a 75% stake in Telasi, the company responsible for electricity distribution in Tbilisi. In addition, through its Netherlands-based subsidiary Gardabani Holdings B.V., the Russian energy giant owns two hydropower plants in Georgia — Khramhesi 1 and Khramhesi 2.
Georgia and the Kingdom of the Netherlands have a bilateral investment protection treaty, which safeguards the interests of foreign investors in Georgia. Gardabani Holdings B.V. and another Dutch-registered Inter Rao subsidiary, Silk Road Holdings B.V., invoked this treaty to defend their investment rights during the arbitration process. Investor protection provisions were also included in the agreements Georgia signed when selling assets to Inter Rao’s Dutch subsidiaries.
According to Telasi’s 2012 management report, on March 31, 2011, Inter Rao and the Government of Georgia signed a memorandum under which the government guaranteed that electricity tariffs in the country would not be revised downward for 15 years. The arbitration tribunal found that Georgia had violated the provisions of this memorandum, giving Inter Rao, as a Dutch investor, the right to receive compensation from the Georgian government.
