What Happens if Armenia Does Not Comply with the International Arbitration Decision Regarding HEC

If Armenia fails to comply with the decision of the Stockholm Arbitration or any other international arbitration court, there are several legal and practical repercussions and mechanisms for enforcing the ruling. Economist Suren Parsyan discussed this issue.

According to him, the Stockholm Arbitration operates as an independent arbitration institution, and its decisions are considered legally binding, similar to the rulings of national courts.

"The decisions of the Stockholm Arbitration are subject to compulsory enforcement under international law based on the New York Convention (1958), to which over 170 countries, including Armenia, are signatories. If the responding party does not comply with the decision, the opposing party can approach the courts of the country where the respondent's assets are located and seek enforcement proceedings.

How can one be compelled to execute an international arbitration ruling? According to the mechanism of the New York Convention, if the respondent's assets are in any country that is a party to the convention, a request is filed with the courts of that country to recognize and enforce the ruling.

A new arbitration claim may also be filed for compensation for damages if the ruling is not executed. For instance, in several cases against Russia, international companies have not enforced the ruling within Russia, but have successfully leveraged the New York Convention against assets outside of Russia," Parsyan detailed.