On 5 July 2022, an international arbitral tribunal established under the ICSID Convention resoundingly and unanimously rejected corruption allegations made by the Republic of Croatia against MOL, the Hungarian national oil and gas company, and its Chairman-CEO, Zsolt Hernádi.

In this arbitration, initiated in 2013, Peters & Peters (Michael O’Kane, Senior Partner; Peter FitzGerald, Of Counsel; Franziska Christen and Emmy Ehrenberg-Shannon, Associates) acted for MOL alongside the Washington DC and New York offices of Dechert, the Zagreb office of Wolf Theiss, and the Budapest office of Queritius. Peters & Peters instructed William Boyce QC, of QEB Hollis Whiteman Chambers, and Maya Lester QC, of Brick Court Chambers.

MOL’s claim arose out of Croatia’s treatment of its investment in INA, the Croatian national oil and gas company, in which MOL acquired a stake in 2003. Peters & Peters’ principal role, as complex criminal disputes specialists, was to respond to Croatia’s jurisdictional objection that the arbitral tribunal was deprived of jurisdiction by virtue of the bribe which it alleged MOL’s Chairman-CEO had offered to its former Prime Minister, Dr Ivo Sanader, in order for MOL to obtain management rights in INA.

On this central issue, the tribunal ruled clearly and unequivocally that, based on the extensive evidence analysed by the arbitrators, Croatia’s bribery allegations were rejected. The evidence included the testimony of dozens of witnesses, tens of thousands of pages of documents, and the opinions of internationally recognised experts. In rejecting Croatia’s bribery allegation, the tribunal unanimously agreed with MOL’s case that Croatia’s key witness, Robert Ježić, was contradictory, evasive and untruthful in every aspect of his testimony.

In respect of MOL’s claims in the arbitration, the tribunal awarded MOL over US$235 million in damages, including interest, and ordered Croatia to pay most of the cost of the proceedings.

Peters & Peters has also acted for MOL in a separate international arbitration under the UNCITRAL rules, in which Croatia’s bribery allegation was likewise unanimously rejected by an arbitral tribunal after lengthy proceedings, and in domestic criminal proceedings in Croatia. Peters & Peters continues to act for MOL and Mr Hernádi in other aspects of this case, including in their dealings with Interpol.