Achmea undertakes legal steps against Slovak Republic

Today Dutch insurer Achmea gave a Notice of Arbitration to the government of the Slovak Republic. The notice opens a new arbitration procedure between Achmea and the Slovak Republic with regard to the plans of the Slovak government to expropriate private health insurers. The notice is given pursuant to art. 3 of the United Nations Commission on International Trade Law Arbitration Rules of 1976 and art. 8 of the Investment Treaty between the Kingdom of The Netherlands and the Slovak Republic.

Achmea starts the arbitration in response to the Slovak Republic's decision to seek to expropriate Achmea's investment in Union zdravotna poistovna (UZP). Achmea wishes to retain its investment in UZP and maintains that the expropriation contemplated is not in the public interest, that it is not taken under due process of law and that it is discriminatory. Moreover, the manner in which the Slovak Republic intends to proceed in the expropriation process clearly contravenes the Bilateral Investment Treaty (BIT). By commencing this arbitration Achmea seeks to avert the impending expropriation.

Achmea already appointed an arbitrator. The government of Slovakia now has two months to do the same. Together, these two arbitrators will appoint an independent president.

This new arbitration procedure follows shortly after an International Arbitration Tribunal in December 2012 ruled in Achmea's favour and decided that the Slovak Republic must pay compensation for the damages Achmea incurred when its ownership rights of UZP were violated between 2007 and 2011. In addition, the Tribunal ruled that the Slovak Republic must pay Achmea's legal cost in the arbitration procedure. The most striking difference between the two arbitration cases is that whereas the former was instigated after Slovakiatook away a number of ownership rights from Achmea - the owner of private health insurance company UZP - the new one seeks to avert the outright expropriation of UZP.