GreenX wins $490m compensation claim as tribunal finds Poland breached treaties

GreenX Metals (ASX: GRX) has achieved a positive financial outcome following the conclusion of its international arbitration claims against the Republic of Poland.

The company has been awarded approximately $490 million in compensation by an international tribunal over matters dating back to 2019 involving a dispute related to a resource project.

GreenX secured compensation under both the Australia-Poland Bilateral Investment Treaty (BIT) and the Energy Charter Treaty (ECT).

Obligations breached

The dispute alleged that Poland had breached its obligations under the applicable treaties by blocking the development of GreenX’s Jan Karski and Dębieńsko projects, effectively depriving the company of the entire value of its investments in Poland.

GreenX formally notified the Polish government of an investment dispute in February 2019 and the company served notices of arbitration in September of the following year.

It then formally lodged its statement of claim in the BIT arbitration, including the first assessed claim for compensation, in June 2021.

Compensation award

In its deliberations, the tribunal unanimously found that Poland had breached its obligations under the treaties concerning the Jan Karski project but did not uphold the claim regarding the Dębieńsko project.

The tribunal awarded the company approximately $490m under the BIT, including interest that will continue to accrue at +1% compounded annually until full and final payment is made by the respondent.

While GreenX was also granted approximately $355m in compensation under the ECT, the company is not entitled to double compensation and will claim the higher amount.

Binding decision

The claim was brought under the United Nations Commission on International Trade Law Rules (UNCITRAL) and the awards are final and binding on the parties.

Poland has 28 days from the date of the BIT award and three months from receiving the ECT award to apply for a set-aside of the respective awards, which can only be granted under limited circumstances.

Each party has been ordered to cover its own legal costs in relation to the claim, which in respect of GreenX have already been fully paid under a Litigation Capital Management funding facility.