Armenia justice minister hints at defying Stockholm ruling on electricity grid, citing 'public order'

By Elen Muradyan

Armenian Justice Minister Srbuhi Galyan said that the government may ultimately not comply with a recent international arbitration order that temporarily blocks state actions against the country’s electricity grid. She cited a possible conflict with Armenia’s public order as grounds for non-enforcement under both domestic and international law.

“There is a possibility—under domestic legislation and international conventions—not to implement an arbitral decision if it contradicts public order,” Galyan told reporters at the government building on Thursday. “I’m not saying this ruling necessarily qualifies, but such a legal pathway exists.”

The minister was referring to a July 22 emergency ruling by an arbitrator appointed by the Arbitration Institute of the Stockholm Chamber of Commerce (SCC). The arbitrator ordered Armenia to refrain from applying recently passed laws targeting the Electricity Networks of Armenia (ENA), a utility owned by jailed billionaire Samvel Karapetyan. The order also blocks the seizure of ENA’s assets, changes to its management, and revocation of its operating licenses.

Karapetyan’s family launched arbitration proceedings under the Armenia–Cyprus bilateral investment treaty, as part of a broader legal strategy to challenge the government’s efforts to nationalize the company. The SCC tribunal concluded that Armenia’s actions raised “serious doubts” about its compliance with its international obligations and warned that the claimants could suffer irreparable harm if the measures were not suspended.

Minister Galyan downplayed the scope of the ruling, describing it as a provisional procedural safeguard. “This is the stage of interim protection,” she said. “The actual dispute has not yet been examined. Only once the arbitration process begins on the merits will the tribunal evaluate the full facts and objectives.”

She added that Armenia had acted within the bounds of the law. “The Republic of Armenia is guided by domestic legislation and international conventions. No violation has been committed—neither of our laws nor of any international agreements,” she said.

The government has claimed its intervention in ENA was driven by concerns over potential energy disruptions, not political motives. “The purpose of appointing a temporary administrator was to avoid a possible crisis that we genuinely faced,” Galyan said. She also clarified that the appointment had not been made directly by the government, but rather by an autonomous regulatory body under legal provisions.

Galyan’s remarks follow a strong reaction from Karapetyan’s defense team, which celebrated the SCC ruling as a clear legal victory. Narek Karapetyan, the businessman’s son and chairman of ENA’s board, stated that the arbitrator had blocked the government from interfering in the company’s business operations, pending the outcome of the full arbitration process.

The ruling has intensified scrutiny of Armenia’s investment climate. Legal expert Taron Simonyan warned that ignoring the order could damage the country’s reputation among international lenders and foreign investors. Armenia is a signatory to the 1958 New York Convention, which obliges member states to enforce foreign arbitral awards, except in limited cases such as conflict with public policy.

Under SCC rules, the emergency ruling will remain in effect only if full arbitration is formally initiated within 30 days and passed to a permanent tribunal within 90 days. If those steps are not taken, the interim measures lapse.

The dispute has emerged against the backdrop of a wider political standoff between Prime Minister Nikol Pashinyan’s government and the Armenian Apostolic Church. Karapetyan, a key ally of the Church, publicly criticized the government on June 17 for pressuring Catholicos Karekin II. He was arrested the following day on charges of inciting regime change. Weeks later, the government moved to take control of ENA.

While the government maintains that its actions are lawful and necessary, critics say the timing suggests retaliation. Galyan, for her part, said the government would present its arguments when the arbitration process formally begins. “We will wait patiently for the tribunal to examine the substance of the dispute,” she said. “And of course, we will assess all risks accordingly.”