Marfin Investment Group Holdings S.A., Alexandros Bakatselos and others v. Republic of Cyprus

A panel of the International Centre for Settlement of Investment Disputes (ICSID) has dismissed a €1.05 billion claim against the Republic of Cyprus lodged by a Greek investment company and other former shareholders in a Cypriot bank. The Cypriot government acquired majority ownership in the Cyprus Popular Bank in a €1.8 billion recapitalization in 2012, amid fears of default due in part to exposure to Greek bonds during that country's debt crisis. The bank was placed in administration the following year, and deposits over €100,000 were made subject to a levy as part of a rescue agreement between Cyprus and the European Commission, the European Central Bank, and the International Monetary Fund.

The investment company, Marfin Investment Group, and other former shareholders brought an ICSID arbitration claim under a 1992 bilateral investment treaty (BIT) between Greece and Cyprus. The claimants challenged Cyprus's regulation of the bank, including the Central Bank of Cyprus's decision to remove management and the terms of the 2012 recapitalization. Skadden Arps, counsel for the Republic of Cyprus, retained Andrew Metrick and Analysis Group affiliate Jean-Pierre Landau, who in turn were supported by a team led by Vice President Steven Saeger and including Vice President Andrew Ungerer. Professors Landau and Metrick filed joint expert reports and provided testimony that addressed the reasonableness of the actions taken by the Cypriot authorities in the context of the European debt crisis.

An ICSID panel rejected the shareholders' claims, holding that Cyprus had not breached any international obligations under the BIT. The panel also awarded the Cypriot government €5 million in legal costs.