Serbia Must Pay Greek Mitilineos 40 Million Dollars in Compensation

Serbia must pay approximately 40 million dollars in compensation to the Greek company Mitilineos due to a strategic partnership agreement with the Mining and Smelting Basin Bor (RTB) from 1998, Belgrade media reported on Tuesday, citing a decision from the International Arbitration Court.

This is the outcome of a years-long arbitration initiated by the Greek company against Serbia, seeking compensation for obligations assumed under the strategic partnership agreement signed while economic sanctions from the international community were in effect against Serbia 19 years ago.

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The international court based in Geneva ruled that Serbia violated its obligations to Greece and Mitilineos, Reuters reported, citing a statement from the Greek company, indicating that the compensation amount is 40 million dollars.

Mitilineos sought compensation of 65 million dollars, which RTB Bor allegedly owed to that Greek partner.

The owner of the Greek company, Evangelos Mitilineos, listed by Forbes as one of the richest people in the world, invoked a clause in the contract with RTB stating that “in case of dispute, the competent court is in Athens” and sought debt settlement in court a few years ago.

The management of RTB Bor, as noted by Belgrade TV B92, signed a strategic partnership agreement with Mitilineos in 1998, during the time of economic sanctions, under which the Greeks invested 16.9 million dollars for the purchase of spare parts and working capital, while Mitilineos supplied copper concentrate to RTB’s metallurgical facilities.

– However, about 4,000 tons of red metal obtained from smelting that raw material, instead of being returned to the Greeks, were used in 2000 to pay salaries to RTB workers. Now the court in Geneva claims that Serbia indirectly obstructed the investment of that Greek company, reports TV B92.

The court ruled that through a series of legal measures from 2004 to 2012, which granted RTB Bor immunity from forced collection due to alleged privatization that did not occur, Serbia indirectly and without compensation took over Mitilineos’s investment.

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By doing so, Serbia prevented the legitimate and reasonable expectations of Mitilineos as an investor to receive fair and just treatment from the state of Serbia, the Greek company stated, citing the court’s decision.

The Mining and Smelting Basin Bor is the only producer of copper, gold, and silver in Serbia, and all its products are listed on the stock exchange, with their quality, demand, prices, and trading conditions regulated by the applicable regulations of the world colored metals exchange. The state wrote off about 90 percent of so-called unsecured claims against RTB Bor during the restructuring, amounting to approximately one billion euros of RTB’s debt.