Berlin, 25.06.: The number of lawsuits before arbitral tribunals against European states, in particular by sanctioned Russian oligarchs, has increased further in the last six months. Germany is now also being sued by the Russian aluminium company Rusal. The vast majority of new lawsuits were filed under bilateral investment treaties.
A total of 40 lawsuits related to the Russia sanctions have now been launched, including two threatened lawsuits. The compensation demanded by Ukraine and its allies now exceeds $63 billion, 88.8 percent of which is demanded by EU member states and the European Union.
Six European civil society organisations ¹ lodged complaints in mid-December against four EU Member States – France, Germany, Sweden and Austria – for maintaining bilateral investment treaties in breach of EU law. ² The complaint is currently being examined by the European Commission. The process is expected to continue until the end of the year. Should the European Commission ask the Member States concerned to terminate or renegotiate their existing bilateral investment agreements, this would have far-reaching consequences for the entire network of investment agreements of other EU Member States, as they essentially contain similar rules.
Fabian Flues, expert in arbitration lawsuits at PowerShift:
“The number of actions brought before non-transparent arbitral tribunals against EU sanctions policy is steadily increasing. Now Germany is also affected by a lawsuit and could be sentenced to pay compensation to a sanctioned oligarch. The federal government must not continue to stand idly by and should finally begin to terminate the agreements that make such lawsuits possible. Otherwise, it may be in breach of European law.”
Proceedings relating to Russia sanctions that have become known in the last six months:
- Russian aluminum company Rusal, owned by oligarch Oleg Deripaska, filed a lawsuit against Germany over a currency deal affected by the sanctions. The company is seeking compensation of $214 million from Germany.
- The Russian VTB Bank has taken the first steps against Germany for an arbitral action. A lawsuit is likely to be directed against measures taken by BaFin, which took over the bank's business in Germany after the invasion of Ukraine. This could soon confront Germany with another lawsuit over Russia's sanctions.
- In September and October 2025, Russian investors filed the first step for arbitration lawsuits against Belgium in five cases. They are against the EU's decision to freeze securities and liquid assets held through Euroclear. After the six-month standstill period, investors can file a lawsuit before an arbitral tribunal.
- The European Union is also being sued directly for its sanctions policy. The wife of fertiliser and coal billionaire Andrei Melnichenko, is taking action against her under EU sanctions, which were imposed after her husband's companies were transferred to her.
- After the implementation of US sanctions, Bulgaria faces a lawsuit by the Russian oil company Lukoil after it had to sell a refinery.
Background:
For more background on how Russian oligarchs are undermining the EU’s Russia sanctions with multi-billion-dollar lawsuits, see our publication ‘Frozen Assets, Hot Claims – How Russian Oligarchs and Other Investors Sue over Sanctions’: https://power-shift.de/en/russian-oligarchs-sue-over-sanctions/
If you have any questions, please do not hesitate to contact:
Fabian Flues, Trade and Investment Policy Officer at PowerShift: fabian.flues@power-shift.de, +49 (0)30 308 821 92
¹ The six organizations behind the complaint are: Institut Veblen (France), Powershift (Germany), Attac Austria and Friends of the Earth Sweden, supported by Friends of the Earth Europe and the European Coalition for Corporate Justice.
² The complaint is based on the settled case law of the European Court of Justice (ECJ), in particular three judgments from 2009. In it, the Court found that Austria, Sweden and Finland had infringed EU law by failing to remove incompatibilities between their bilateral investment agreements concluded before EU accession and EU rules on capital movements (Cases C-205/06, C-249/06 and C-118/07). In addition, the complaint refers to Opinion 1/17 on CETA (2019), in which the CJEU stated that investor-state dispute settlement (ISDS) mechanisms are permissible in a non-European context, provided that they do not affect the autonomy of the EU legal order.
The complaint is available here: https://power-shift.de/wp-content/uploads/2025/12/Infringement_complaint_merged_text_4MS_for_information-incl-logos.pdf
