Kyiv, April 22, 2014. The Supreme Economic Court of Ukraine issued a death verdict to foreign investment, supporting the decision to terminate the investment agreement in the Illichivsk port. As a result of considering the appeal of the private enterprise Container Terminal Illichivsk (CTI) in the case of termination of the joint venture with the state enterprise Illichivsk Commercial Sea Port (ICSP), the Supreme Economic Court upheld the decisions of the courts of first and appeal instances. CTI's management considers the decision illegal, and plans to challenge it in the Supreme Court of Ukraine, intending to exhaust all the national and European mechanisms for investor protection. Termination of the contract between the CTI and ICSP will lead to the obligation of the state to compensate more than $500 million to the container terminal. Considering the financial performance of the port, the payment of such obligations will inevitably lead to the bankruptcy of the state enterprise and the loss of state property. CTI challenges the decision of the court, since the termination of the investment agreement concluded in 2005 leads to extremely negative social consequences, violates the rights of investors and is contrary to the Law on Sea Ports of Ukraine. In particular, the termination of the contract on the grounds claimed by ICSP (implementation of the port reform), directly violates the provisions of the law on seaports on continuation of investment agreements on the use of port infrastructure, concluded before the law came into force. "ICSP's claim to terminate the joint venture agreement satisfied by the Ukrainian courts is a direct violation of the state guarantees. This development is beyond the comprehension of the foreign investors," commented Andriy Pavliutin, CEO of CTI. “Apparently, Ukraine should not count on the inflow of foreign investment any time soon. Our partners from the American investment fund Siguler Guff and the German company SRR Deutschland were discouraged by the Supreme Economic Court’s decision. Bad news travels fast, and foreign investors will react to them instantly. In this case, not in Ukraine’s favor,” added the head of CTI. “We had hoped until the last moment that the common sense, the rule of law and state interests would prevail over private interests of the ICSP's management and their patrons. Regretfully, the miracle did not happen. I am sure that our client CTI will not be stopped and will continue to defend their interests with even greater zeal,” commented on the court’s decision managing partner of the Asters law firm Oleksiy Didkovskyi. Notably, CTI is a company with foreign investments: 50% stake is owned by the U.S. investment fund Siguler Guff & Company, 25% - by the German forwarding company SRR Deutschland, and 25% - by the company's CEO Andriy Pavliutin. For more information, please contact tel. +38 (063) 725-22-22, e-mail: [email protected] or go to website: kti-terminal.com