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GAR 100 - 11th Edition

Schönherr

04 April 2018

Achieved another win for Montenegro and picked up a GAR Award

People in Future Leaders 4
Pending cases as counsel 10
Value of pending counsel work US$900 million
Treaty cases 4
Current arbitrator appointments 11(of which 6 are as sole or chair)
Lawyers sitting as arbitrator 3

Founded more than 50 years ago, Schönherr is part of the Austrian establishment. As such, it has long been counsel to numerous big-name companies in central and eastern Europe. In 2000, the firm decided to expand its service to include a focused international arbitration practice.

Hellwig Torggler and Gerold Zeiler were instrumental in training up the team (the firm opted to grow its own rather than make lateral hires). Both later left to set up their own firms: Torggler in 2007 and Zeiler in 2014.

Since Zeiler’s move, the arbitration practice has been headed by Christoph Lindinger, also Schönherr’s managing partner. The team includes partner Anne-Karin Grill and counsel Leon Kopecký in Vienna.

Network

The anchor of the practice is Vienna but the firm is present in 11 other countries across central and eastern Europe and the Balkans. It also has an office in Brussels and has had a cooperation agreement with a firm in Istanbul, where the local disputes head is Murat Canyürek. There are country desks for Albania, Bosnia and Herzegovina, Macedonia and Montenegro.

Who uses it?

The arbitration group’s focus is on energy or investment work – much of it related to central and eastern Europe. It has acted for German energy group RWE in various oil and gas arbitrations, as well as Romania’s OMV Petrom. Siemens, Spanish carmaker SEAT and Kosovan mobile phone operator Dardafone have also relied on the firm.

On the government side, it has represented the Czech Republic, Montenegro, Moldova and Republika Srpska in disputes arising from investments in energy, metals, banking, agriculture and real estate, including at ICSID.

Track record

The firm has obtained particularly impressive results for Montenegro. In 2016, it helped the state see off its first ICSID case – a €100 million claim brought by a pair of Dutch investors in a bankrupt steel plant.

Later in the year, it helped Montenegro see off a pair of cases brought by companies linked to Russian tycoon Oleg Deripaska’s En+ Group over a bankrupt aluminium plant. One of these, a €600 million ICSID claim, was tossed out after Schönherr persuaded the tribunal that the claimant didn’t have a “seat” in Cyprus, whose bilateral investment treaty with Montenegro it had sought to invoke. Annulment proceedings at ICSID are pending.

Schönherr also helped Montenegro defeat the bulk of a €650 million contractual claim brought by Deripaska’s companies, with an UNCITRAL panel in Vienna awarding its client damages in a counterclaim. Deripaska has since personally filed a claim against the state under a Russian BIT, for which Montenegro has once again retained the firm.

The firm scored a big win for the government of Republika Srpska in a case brought by Czech energy conglomerate CEZ, knocking the claim out at the jurisdictional phase.

As for private clients, it helped Dardafone win over €30 million in a case against Kosovo Telecom. It defended Swiss retail holding group Valora in a post-M&A dispute heard in Frankfurt, with the tribunal rejecting all claims against the client in 2015.

It has also secured favourable settlements for Austrian oil and gas firm OMV in two ICC cases relating to a post-M&A dispute and a petroleum concession in Pakistan, having replaced another GAR 100 firm on the matter.

Recent events

In 2017, the firm picked up the GAR award for “international arbitration practice that impressed” following its successes for Baltic clients in investor-state disputes.

Chalking up another win for Montenegro, the firm saw off an UNCITRAL claim concerning the sale of a stake in a marina. The case was brought by a Latvian company that has been held by the English courts to be a front for fugitive Russian banker Vladimir Antonov. The claims were withdrawn after a sole arbitrator declined jurisdiction, with the claimant ordered to pay the state’s costs.

Schönherr continues to represent Montenegro in two other cases at the Permanent Court of Arbitration in The Hague: one filed by Deripaska and another by an investor called Medusa.

It is defending Moldova against an ICSID claim brought by a US-Polish national who alleges he was subject to threats and extortion in a dispute over farm leases.

Partner Anne-Karin Grill helped conduct a first-of-its-kind mediation at the Energy Community Dispute Resolution and Negotiation Centre following a complaint brought against Bosnia and Herzegovina regarding environmental permits for two thermal power plant projects.

The firm is representing investors in three ICSID cases against Serbia. One is brought on behalf of Cyprus-based Mera Investment Fund, whose alleged beneficial owner was jailed for tax evasion. In the second case, it acts for Austrian logistics company Kunsttrans in a dispute over the construction of a state-of-the-art storage depot for the National Museum of Serbia’s art collection. The final case is brought on behalf of a Belgian company over the construction of Serbia’s first animal waste-processing plant.

Away from investor-state work, the firm advised professional services firm Alvarez & Marsal in a €10 million dispute with a Slovenian corporation in the automotive industry. A settlement was reached in June 2017.

It also acted in an ICC case over a long-term gas supply agreement for the Romanian market.

Client comment

Andreas Aigner, head of M&A and legal at Austrian oil and gas company OMV, says the firm’s performance is “always outstanding, not only in terms of managing complex and fact intensive disputes but also in its solution-driven advice.” He says Christoph Lindinger is a “brilliant strategic thinker, hard worker and very impressive in pleading before tribunals.”

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