FIRST SECTION

CASE OF BTS HOLDING, A.S. v. SLOVAKIA

(Application no. 55617/17)

JUDGMENT

Art 1 P1 • Peaceful enjoyment of possessions • Unjustified refusal to enforce

final and binding arbitration award by International Chamber of Commerce
against National Property Fund after rescission of share-purchase agreement
for State property being privatised

STRASBOURG

30 June 2022

This judgment will become final in the circumstances set out in Article 44 § 2 of the
Convention. It may be subject to editorial revision.
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

In the case of BTS Holding, a.s. v. Slovakia,

The European Court of Human Rights (First Section), sitting as a Chamber
composed of:
Marko Bošnjak, President,
Péter Paczolay,
Krzysztof Wojtyczek,
Alena Poláčková,
Erik Wennerström,
Raffaele Sabato,
Ioannis Ktistakis, judges,
and Renata Degener, Section Registrar,
Having regard to:
the application (no. 55617/17) against the Slovak Republic lodged with
the Court under Article 34 of the Convention for the Protection of Human
Rights and Fundamental Freedoms (“the Convention”) by a private
joint-stock company established under the laws of Slovakia, BTS Holding,
a.s. (“the applicant company”), on 28 July 2017;
the decision to give notice of the application to the Government of the
Slovak Republic (“the Government”);
the parties’ observations;
Having deliberated in private on 17 May 2022,
Delivers the following judgment, which was adopted on that date:

INTRODUCTION
1. Raising mainly issues under Article 1 of Protocol No. 1, this case
concerns the non-enforcement against the National Property Fund of Slovakia
(“NPF”), the country’s privatisation agency, of an arbitration award made by
the International Court of Arbitration (“the ICA”) of the International
Chamber of Commerce in Paris (“the ICC Tribunal”).
2. The award was for the payment of a principal amount plus interest
based on the rescinding by the NPF of a contract with the applicant company
for the purchase by the latter of shares in Bratislava Airport in the process of
its privatisation.

THE FACTS
3. The applicant company was established in 2005 and has its registered
seat in Bratislava. It was represented by Mr W. Plesser, succeeded by
Mr T. Kustor, lawyers practising in Vienna (Austria).
4. The Government were represented by their Agent, Ms M. Bálintová.
5. The facts of the case may be summarised as follows.

1
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

I. BACKGROUND

6. The applicant company was the successful bidder for the purchase of
a majority share in Bratislava Airport in the process of its privatisation. This
resulted in the conclusion in 2006 of a share-purchase agreement (“the SPA”)
between the applicant company and the NPF. The latter is a body established
by special legislation to implement the privatisation of State-owned property
under the supervision of the government and Parliament.
7. The SPA contained an arbitration clause to the effect that disputes
arising out of the agreement were to be referred to the ICC Tribunal and to be
resolved under the ICC Rules of Arbitration. The seat of arbitration was to be
Paris.
8. Under the SPA, the applicant company paid a large sum of money to
the NPF as the first tranche of the purchase price (“the first tranche”).
9. However, the NPF then rescinded the SPA and paid the amount of the
first tranche back to the applicant company, on the grounds that the time-limit
defined in the SPA for the approval of the transaction by the Anti-Monopoly
Office of Slovakia (“the AMO”) had expired without approval having been
granted.
10. In 2008 the NPF, the applicant company, the State in the person of the
respective ministry and another party agreed (“the 2008 settlement”) that the
NPF’s rescission of the SPA was valid and effective as of a certain date
(21 September 2006). In so far as can further be established from the ensuing
judicial decisions, the parties also agreed that their mutual commitments were
terminated, in particular for the payment of the purchase price in return of the
transfer of the to-be-privatised shares, and it was declared that there were no
outstanding mutual claims for damages. However, in order to avoid doubts,
matters of return of the purchase price and interests were excluded from the
scope of the settlement. No understanding concerning the dispute-resolution
mechanism was included.
11. In 2009 the NPF paid another amount of money to the applicant
company intended to cover interest on the amount of the first tranche in the
period between rescinding the SPA and the repayment of that amount.

II. ARBITRATION AWARD

12. On 21 June 2010 the applicant company requested arbitration before

the ICC Tribunal.
13. On 28 February 2011 the NPF, the applicant company and the ICC
Tribunal concluded the terms of reference, defining, inter alia, the parameters
of the case to be decided.
14. The essence of the dispute was whether the amounts paid by the NPF
constituted, first, a payment towards repaying the principal amount of the first
tranche and, then, payment of interest that had accrued, or the other way

2
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

around; since what date and at what rate the interest had started to accrue;
and, consequently, whether there were any further amounts due by the NPF.
15. The dispute was resolved in an award of 8 June 2012.
16. The ICC Tribunal found that the payments made constituted, first,
payment of the interest and, only thereafter, payment towards the principal
amount of the first tranche, precisely determining the interest rates applicable
to the various stages at which the payments had been claimed and made, as
well as the outstanding amount of the principal sum on which interest was to
be paid with regard to the said stages.
17. In sum, the ICC Tribunal ruled that the NPF was to pay the applicant
company (i) a principal amount of 1,894,597.52 euros (EUR), and (ii) interest
of 14.25% per annum on EUR 1,853,584.45 for the period from
13 March 2009 until full payment of the award.
18. On 19 December 2012 the Secretary General of the ICA issued
a written statement certifying, inter alia, that the award had been notified to
the parties on 21 June 2012 and that it had been received by the NPF on
25 June 2012. The statement further cited Article 28 § 6 of the ICC
Arbitration Rules, as in force at the relevant time, pursuant to which:
“Every Award shall be binding on the parties. By submitting the dispute to arbitration
under these Rules, the parties undertake to carry out any Award without delay and shall
be deemed to have waived their right to any form of recourse insofar as such waiver
can validly be made.”

III. ENFORCEMENT OF THE AWARD

19. On 4 February 2013 the applicant company petitioned for

enforcement of the award in Slovakia.
20. On 30 April and 20 June 2014, respectively, the Bratislava II District
Court authorised a judicial enforcement officer to enforce the award and he
issued a notice of enforcement (upovedomenie o začatí exekúcie) informing
the NPF that enforcement proceedings had commenced and ordering it
to settle its debt.
21. In response, the NPF lodged an objection (námietky) against the
enforcement. It argued that the SPA had been superseded by the 2008
settlement and that the latter contained no arbitration clause, in the absence
of which the enforcement of the award would be contrary to public policy.
Moreover, it would be contra bonos mores, as the applicant company was
simply seeking further financial satisfaction by claiming a large sum of
money from public funds, ultimately at the cost of the taxpayers.
22. In reply, the applicant company pointed out that the 2008 settlement
only addressed the question of the validity and effect of the rescinding of the
SPA but had in no way replaced it. The ICC Tribunal had specifically
examined the issue of an arbitration clause and the enforcement court had no
jurisdiction to deal with this question. Moreover, the NPF had agreed to the

3
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

terms of reference whereby it had acknowledged the jurisdiction of the ICC

Tribunal. Through the SPA, it was ultimately the State who had entered into
a private-law relationship with the applicant company. That relationship
involved liability and it was unacceptable to disregard it at the expense of the
applicant company.
23. On 15 August 2014 the District Court allowed the objection and,
following an appeal by the applicant company, the Bratislava Regional Court
upheld that decision on 31 March 2015. Each court gave different reasons. It
was later accepted by the Constitutional Court and acknowledged by the
Government that the two sets of reasons were complementary. They may be
summarised as follows.
24. There was no separate decision to be taken concerning the recognition
of foreign arbitration awards in Slovakia. Such awards were recognised by
the fact that the enforcement court took them into account as if they were
domestic awards. Accordingly, issuing authorisation to carry out the
enforcement of a foreign arbitration award de facto amounted to its
recognition.
25. As to the legal framework for the objection, it was acknowledged that
it could only concern the admissibility of the enforcement but not the award
to be enforced. An objection against enforcement could only be based on
circumstances intervening after the award had been made.
26. It was true that, in the enforcement of a foreign arbitration award, the
provisions of the Convention on the Recognition and Enforcement of Foreign
Arbitral Awards (promulgated in Slovakia by Decree no. 74/1959 Coll. of the
Minister of Foreign Affairs – “the New York Convention”) had precedence
over the respective provisions of the Arbitration Proceedings Act
(Law no. 244/2002 Coll., as amended). Nevertheless, the State’s sovereignty
and the enforcement court’s power to examine issues of public policy
remained unaffected.
27. The enforcement court was under a duty to examine the lawfulness of
the award, not as to its substantive correctness, but as to whether it was
capable of being enforced. The courts acknowledged that, as a matter of
principle, a rescission of a contract had no impact on any contractual
dispute-resolution arrangements. In addition, the Regional Court cited section
5(3) of the Arbitration Proceedings Act, pursuant to which, unless specifically
agreed otherwise, which was not the case of the 2008 settlement, a recission
of a contract had no impact on the validity of the arbitration clause contained
therein. Nevertheless, without addressing the application of these rules to the
facts of the present case, the District Court held that the 2008 settlement
superseded the SPA and subsumed its arbitration clause. The ICC Tribunal
therefore had no jurisdiction in the case and its order for payment was
unlawful. The Regional Court for its part offered no specific conclusions on
this matter, adding that the award did not define the time frame for
compliance and was not accompanied by a certificate of the date of its

4
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

becoming enforceable (doložka vykonateľnosti). Although these formal

requirements stemmed from the national rules, they applied to the award and
the statement of the ICA Secretary General of 19 December 2012 (see
paragraph 18 above) could not be seen as fulfilling them.
28. In addition, the enforcement was contrary to public policy, on three
grounds.
Firstly, as the award concerned a large sum of money, its enforcement
would “impact a large group of people, namely taxpayers, since in the event
of an enforcement of such magnitude the financial means would come from
the State budget. This would have a negative impact on the general public”.
Secondly, as set out in the statement of 19 December 2012, prior to the
arbitration the parties had waived their right of recourse against the award,
which included the right of access to a court.
Thirdly, the claims of the applicant company were based on the rescinding
of the SPA by the NPF and that had been due to the need to protect against
market concentration.
29. On 20 October 2015 the District Court terminated the enforcement
proceedings. In its reasoning, it noted that the NPF’s objection against the
enforcement had been allowed and it directly followed from Article 50 § 5 of
the Enforcement Code (Law no. 233/1995 Coll., as applicable at the relevant
time) that the proceedings were to be terminated, the decision not being
amenable to appeal. However, in the concluding part of the decision, which
is reserved for instructions concerning any remedies, it indicated that the
decision could be appealed against within fifteen days.
30. In the absence of any appeal as to the merits of the decision to
terminate the proceedings, it became final and binding on 12 November 2015.

IV. CONSTITUTIONAL COMPLAINT

31. On 26 August 2015 the applicant company lodged an individual

complaint with the Constitutional Court, challenging the decisions of
15 August 2014 and 31 March 2015 concerning the NPF’s objection to
enforcement.
Arguing that there had been a violation of its rights to a fair hearing and
protection of property, the applicant company emphasised that, at the
enforcement stage of the proceedings, any objections could only pertain to
the enforcement but not to the award. The conclusion that it was
unenforceable on the grounds that it lacked a time frame for compliance and
a certificate of its becoming final had been based on requirements of national
law which were inapplicable to foreign arbitral awards. Any suggestion that
it had been contrary to public policy for the parties to waive rights to be
acquired in the future was manifestly flawed since any such waiver had been
specifically limited “insofar as [it had been possible for it] validly [to] be
made”. The reference to the need to protect against market concentration was

5
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

likewise arbitrary because this was not a part of the dispute, there was nothing
at play that could endanger competition, and the Regional Court had
completely distorted the applicable rules and principles. Lastly, the reasoning
of the Regional Court concerned matters that had not been debated at the
earlier stages of the proceedings and the applicant company had had no
opportunity to take a position on them.
32. On 8 November 2016 the Constitutional Court declared the complaint
inadmissible. Any complaint in relation to the District Court fell within the
jurisdiction of the Regional Court and, under the principle of subsidiarity, not
within that of the Constitutional Court. As to the Regional Court, it had
exercised its jurisdiction within its remit, interpreting and applying the
relevant legal rules in a constitutionally acceptable manner. Its conclusions
followed from the established facts and were logical and legitimate.
33. There had been no obstacle for the Regional Court to uphold the
decision of the District Court in that it had supported the latter’s conclusions
by supplementing substantial argumentation of its own.
34. There was nothing in the challenged decision to show that there had
been an interference with the applicant company’s right to protection of
property.
35. As an aside (nad rámec uvedeného), the Constitutional Court
observed that the enforcement proceedings had been terminated in the
meantime and that the applicant company had not challenged that decision by
an appeal. It had accordingly not exhausted ordinary remedies, which
precluded it from seeking the protection of its rights before the Constitutional
Court.

RELEVANT LEGAL FRAMEWORK

I. ARBITRATION PROCEEDINGS ACT

36. Foreign arbitral awards are addressed in sections 46 to 50 of the Act.

There is no separate decision to be taken concerning their recognition
(section 49(1)). Such an award is recognised by the fact that the enforcement
court takes it into account (naň prihliadne) as if it were a domestic award.
37. Under section 50(2), the enforcement court must refuse recognition
and enforcement of a foreign award even without an application to that effect
by the party against whom the award is asserted, if it finds the enforcement
contrary to public policy.
38. Pursuant to section 51(3), if a certain procedural matter is not
addressed by the Act, it is to be resolved under the provisions concerning the
procedure before the ordinary courts.
39. The provisions of the Act apply unless an international treaty binding
on Slovakia and part of its legal order, such as the New York Convention,
provides otherwise (section 53, in conjunction with footnote 19 in the Act).

6
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

II. CODE OF CIVIL PROCEDURE

40. At the relevant time and until 30 June 2016, the rules of procedure
before the ordinary courts were embodied in the Code of Civil Procedure
(Law no. 99/1963 Coll, as amended). Under Article 160 § 1, if a judgment of
a court of law imposed a duty, it was to be complied with within three days
of the judgment becoming final and binding, with the court having the power
to define a longer period for compliance.

III. ENFORCEMENT CODE

41. At the relevant time, objections against enforcement proceedings were

mainly regulated by Article 50 of the Enforcement Code. According to its
paragraph 1, an objection might be raised if, subsequent to the decision to be
enforced, circumstances had arisen that prevent its enforcement or if there
were other grounds on which the enforcement was impermissible. The
objection had to include reasons and any reasons advanced subsequently were
not to be considered.
42. Pursuant to paragraph 5 of Article 50 of the Code, if the decision
allowing an objection became final and binding, the enforcement court was
to terminate the proceedings; this decision was not amenable to appeal.
43. Under Article 201 § 1 (b), in relation to enforcement proceedings that
have been terminated, no action for their reopening is permissible.

IV. CONVENTION ON THE RECOGNITION AND ENFORCEMENT OF

FOREIGN ARBITRAL AWARDS

44. Under Article V of the New York Convention:

“1. Recognition and enforcement of the award may be refused, at the request of the
party against whom it is invoked, only if that party furnishes to the competent authority
where the recognition and enforcement is sought, proof that:
(a) The parties to the [arbitration agreement] were ... under some incapacity, or the
said agreement is not valid ...; or
(b) The party against whom the award is invoked was not given proper notice of the
appointment of the arbitrator or of the arbitration proceedings or was otherwise unable
to present his case; or
(c) The award deals with a difference not contemplated by or not falling within the
terms of the submission to arbitration, or it contains decisions on matters beyond the
scope of the submission to arbitration...; or
(d) The composition of the arbitral authority or the arbitral procedure was not in
accordance with the agreement of the parties, or, failing such agreement, was not in
accordance with the law of the country where the arbitration took place; or
(e) The award has not yet become binding on the parties, or has been set aside or
suspended by a competent authority of the country in which, or under the law of which,
that award was made.

7
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

2. Recognition and enforcement of an arbitral award may also be refused if the

competent authority in the country where recognition and enforcement is sought finds
that:
(a) The subject matter of the difference is not capable of settlement by arbitration
under the law of that country; or
(b) The recognition or enforcement of the award would be contrary to the public
policy of that country.”

V. REMEDIES UNDER FRENCH LAW IN RELATION TO

INTERNATIONAL ARBITRATION AWARDS ISSUED IN FRANCE

45. Unless otherwise agreed by the parties, international arbitration

awards made in France as from 1 May 2011 may be subject to an action for
annulment under Articles 1518 and 1526 of the Code of Civil Procedure, with
further remedies being available under Articles 1485 and 1502, in
conjunction with Article 1506 §§ 4 and 5.

THE LAW

I. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL No. 1

46. The applicant company complained that enforcement of the arbitral

award in its favour had been arbitrarily refused, contrary to its rights under
Article 1 of Protocol No. 1 to the Convention, which reads as follows:
“Every natural or legal person is entitled to the peaceful enjoyment of his possessions.
No one shall be deprived of his possessions except in the public interest and subject to
the conditions provided for by law and by the general principles of international law.
The preceding provisions shall not, however, in any way impair the right of a State to
enforce such laws as it deems necessary to control the use of property in accordance
with the general interest or to secure the payment of taxes or other contributions or
penalties.”

A. Admissibility

1. Compatibility
47. Referring to the domestic courts’ conclusion that the applicant
company’s arbitration award was unenforceable, the Government contended
that none of them had “upheld” the applicant company’s “claim” and that,
accordingly, that claim was not “arguable” and therefore did not amount to
a possession for the purposes of Article 1 of Protocol No. 1. The applicant
company’s complaint under that provision was therefore incompatible with it
ratione materiae. In their view, the present case was similar to ALMEDIA
spol. s r.o. v. Slovakia ((dec.) [Committee], no. 55631/12, 6 November 2018),
which had been rejected on precisely that ground.

8
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

48. The applicant company disagreed and challenged the grounds on

which the enforcement had been refused.
49. The Court reiterates that a “claim” can constitute a “possession”
within the meaning of Article 1 of Protocol No. 1 if it is sufficiently
established to be enforceable, for example by virtue of an arbitration award
(see Stran Greek Refineries and Stratis Andreadis v. Greece, 9 December
1994, § 59, Series A no. 301-B).
50. In the present case, the applicant company relied on an arbitration
award by the ICC Tribunal for payment of an amount of money in its favour.
It is undisputed that this award has become final and binding, that it could
have been challenged by the procedures provided for this purpose in the
jurisdiction of the seat of the arbitration (see paragraph 45 above), that no
such procedures have been made use of, and that, by operation of the New
York Convention and the respective provisions of the Arbitration
Proceedings Act, foreign arbitration awards are in principle enforceable in
Slovakia (compare Stran Greek Refineries and Stratis Andreadis, cited
above, § 61).
51. As acknowledged by the domestic courts, there was no separate
decision to be taken for the recognition of the award in Slovakia and, by
operation of law, its legal recognition in Slovakia was implicit in the
appointment of a judicial enforcement officer to enforce it (see paragraphs 24
and 36 above).
52. The Court would emphasise in particular that, beyond the question of
such implicit recognition, the proceedings pursued by the applicant company
at the domestic level were purely of the nature of enforcement proceedings.
As is likewise clear from the applicable statute and practice, the legal
framework of those proceedings for the examination of the NPF’s objection
to the enforcement did not allow for any substantive review of the award
itself, such examination being limited to any obstacles to the enforcement
intervening after the award had been made (see paragraphs 25 and 41 above).
53. In these circumstances, the Court finds that the applicant company’s
award was sufficiently established to amount to a “possession” within the
meaning of Article 1 of Protocol No. 1. The obstacles to its enforcement, as
established by the domestic courts, pertain to the questions of interference
with the applicant company’s rights under that provision and, as the case may
be, compliance of that interference with the applicable requirements.
54. In response to the Government’s specific argument, the Court fails
to discern any relevant similarity between the present case and ALMEDIA
spol. s r.o. (cited above, §§ 39-40). That case concerned the enforcement
against the legal successor of the applicant company’s original debtor of a
court order issued against the original debtor, the point of contention being
whether the claim adjudicated against the original debtor had passed from it
onto its legal successor.

9
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

55. The Government’s incompatibility objection is accordingly

dismissed.

2. Domestic remedies
56. The Government also relied on the Constitutional Court’s observation
that the applicant company had not challenged the decision to terminate the
enforcement and argued that it had therefore failed to exhaust domestic
remedies as required by Article 35 § 1 of the Convention.
57. The applicant company disagreed and argued, relying on
Article 50 § 5 of the Enforcement Code, that no appeal against the decision
to terminate the enforcement proceedings had been available.
58. The Court notes first of all that Article 50 § 5 of the Enforcement
Code, as applicable at the relevant time, clearly and directly excluded the
availability of an appeal against a decision to terminate enforcement
proceedings (see paragraph 42 above). In fact, the enforcement court in the
present case acknowledged that in the reasoning of its decision (see paragraph
29 above). The Constitutional Court’s observation in passing to the contrary
(see paragraph 35 above) does not address in any way this statutory rule and
the Government have failed to respond to the applicant company’s argument
essentially submitting that the suggestion that an appeal had been available
was in fact mistaken.
59. Irrespective of that, the Court notes that the observation of the
Constitutional Court in issue was made as an aside which did not prevent it
from examining the substance of the applicant company’s arguments against
the decision to allow the NPF’s objection, and the termination of the
enforcement proceedings was a direct consequence of that decision (see
paragraphs 29 and 42 above).
60. In these circumstances, there is no room for accepting the
Government’s objection and it must be dismissed.

3. Conclusion
61. The Court notes that the complaint is neither manifestly ill-founded
nor inadmissible on any other grounds listed in Article 35 of the Convention.
It must therefore be declared admissible.

B. Merits

62. The applicant company complained that the non-enforcement of its

award had constituted an interference with its possessions that had been
neither lawful nor justified in terms of pursuing any legitimate aim or being
proportionate.
63. The Government pointed out that the domestic courts at all levels had
found the applicant company’s award unenforceable on a multitude of

10
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

grounds. Those identified by the Regional Court had been complementary to

those relied on by the District Court. The courts’ decisions had been
congruous, consistent with established practice, adequately reasoned, free
from arbitrariness, and had resulted from proceedings that had been
procedurally fair.
64. The Court notes that the domestic courts found that it was impossible
to have the applicant company’s adjudicated claim enforced. As the Court has
found this claim to constitute a possession, its non-enforcement amounted to
an interference with it. This interference constituted neither a deprivation of
possessions within the meaning of the second sentence of Article 1 of
Protocol No. 1 nor a measure of control of the use of property within the
meaning of its third sentence. It must accordingly be examined under the
general rule embodied in its first sentence (see Stran Greek Refineries and
Stratis Andreadis, cited above, §§ 67 and 68).
65. It is an essential condition for an interference to be deemed compatible
with Article 1 of Protocol No. 1 that it be lawful, with the Court’s power
to review compliance with domestic law being limited to instances of
manifestly erroneous application of the impugned legal provisions or
arbitrary conclusions being reached (see, for example, Beyeler v. Italy [GC],
no. 33202/96, § 108, ECHR 2000-I, with further references). Noting that the
Government have advanced no arguments on this aspect of the case, for the
reasons laid out below, the Court has grave concerns as to the compatibility
of the domestic courts’ conclusions in the present case with the principle of
lawfulness within the above definition.
66. It notes the domestic courts’ assessment to the effect that the
enforcement was precluded because (i) there had effectively been no
arbitration clause in place to establish the jurisdiction of the ICC Tribunal,
(ii) the award did not specify a time frame for compliance and was not
accompanied by a certificate of the date of its becoming enforceable, (iii) the
award concerned a large sum of money that would have to be paid at the
expense of the tax payers, (iv) prior to the award the parties had waived the
right of recourse, and (v) the transaction underlying the awarded amount had
had to do with the protection of competition.
67. As regards point (i), the Court observes that, as acknowledged by the
domestic courts, under the applicable domestic law a recission of a contract
as such has no impact on the validity of an arbitration clause. In view of this
rule, it finds it arbitrary for the District Court to hold, without any analysis,
that the 2008 settlement subsumed the arbitration clause in the SPA and for
the Regional Court to offer no specific conclusion on this question (see
paragraph 10 and 27 above). In addition, the Court notes that under the ICC
Tribunal’s terms of reference the parties submitted their dispute to the ICC
Tribunal and that neither of them objected to its jurisdiction in the course of
the arbitration proceedings.

11
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

68. Concerning point (ii), it cannot be brought into question that the award
contained an order for payment which was binding on the parties and that by
submitting their dispute to the ICC Tribunal the parties had undertaken to
abide by the award without delay, as provided for by the ICC Arbitration
Rules and certified by the ICA Secretary General in his statement of
19 December 2012. The Court likewise notes that, under the general rules of
procedure before the ordinary courts in Slovakia at the relevant time, which
were to be used if the given matter was not addressed by the specific rules
concerning arbitration, a tribunal’s order was to be complied with within three
days of it becoming final and binding, unless the order provided otherwise
(see paragraphs 38 and 40 above). Furthermore, the Court observes that this
ground for refusing enforcement was established by the court of appeal
beyond and above the grounds advanced by the NPF in its objection without
giving the applicant company an opportunity to respond.
69. In relation to point (iii), the Court notes that the debtor under the
award was the NPF, that this entity was in fact an agency of the State, that the
payments it was ordered to make under the award originated from
an investment transaction it had entered into with the applicant company on
the basis of a contract of a private-law nature, and that, as noted by the courts
themselves, the payment under the award would ultimately have to be made
from the State budget. However, as previously recognised by the Court, a lack
of funds cannot justify an omission by a State authority to honour a judgment
debt (see Burdov v. Russia, no. 59498/00, § 41, ECHR 2002-III).
70. As to points (iv) and (v), the Court observes first of all that, similarly
to point (ii), they had not been advanced by the NPF but had been relied on
by the court of appeal without giving the applicant company an opportunity
to respond. The former of these grounds relied on the provision of
Article 28 § 6 of the ICC Arbitration Rules concerning a waiver by the parties
to an ICC arbitration of the right to recourse. However, under the provision
in question, any such waiver was clearly intended only “insofar as [it could]
validly be made”. To the extent the court of appeal referred to the notion of
the protection of competition as a component of point (v), the Court likewise
finds it difficult to follow its rationale. It is uncontested that the transaction
intended under the SPA necessitated approval by the AMO and that no such
approval was issued within the time frame defined by the SPA, which was
the reason for the NPF’s rescinding of that contract. However, there is no
indication that the lack of approval within a given time frame amounted to
an actual refusal of the transaction. In fact, no decision on the merits of this
matter was ever taken by the AMO. There is accordingly no indication that
the intended transaction was contrary to the rules on competition. Moreover,
and irrespective of that, the transaction was effectively rescinded, the
payment to be made under the award concerned claims related to that
rescission, and there has not been any suggestion that the satisfaction of those
claims would in any way impact on competition.

12
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

71. In view of the above considerations, it would appear that the grounds
relied on by the domestic courts were not given and/or fell outside the legal
framework for denying enforcement of a foreign arbitration award allowed
by the provisions of the domestic law and the New York Convention (see
paragraphs 37, 41 and 44 above). Be that as it may, and even assuming that
denying enforcement of the award on these grounds served a general interest,
it has not been shown that it was proportionate to that aim. In that regard, the
Court notes again that the Government have advanced no arguments on this
aspect of the case and that, while focusing on elements which purportedly
precluded the enforcement by reason of public policy or procedural
formalities, the domestic courts took no account of the requirements of the
protection of the applicant company’s fundamental rights and the need for
a fair balance to be struck between them and the general interest of the
community rights (see Sporrong and Lönnroth v. Sweden,
23 September 1982, § 69, Series A no. 52).
72. The foregoing considerations are sufficient to enable the Court
to conclude that the refusal to enforce the applicant company’s arbitration
award was not justified for the purposes of Article 1 of Protocol No. 1.
73. There has accordingly been a violation of Article 1 of Protocol No. 1.

II. REMAINING ALLEGED VIOLATIONS

74. Relying on Articles 6 and 13 of the Convention, the applicant

company complained that the refusal to enforce a final and binding arbitration
award in its favour had been arbitrary and contrary to the principle of legal
certainty and that it had had no effective domestic remedy in that regard.
75. The Government argued non-exhaustion of domestic remedies as in
relation to the complaint under Article 1 of Protocol No. 1. In addition, they
recapitulated the reasoning behind the domestic courts’ decisions,
acknowledging that those of the Regional Court complemented those of the
District Court. The applicant company’s arguments had been duly examined
and answered in a way that was contrary neither to its right of access to court
nor to any other component of its right to a fair hearing.
76. Having regard to the facts of the case, the submissions of the parties,
and its findings above, the Court considers that the objection as to the
exhaustion of domestic remedies must be dismissed and that, on the
substance, it has already examined the main legal questions raised in the
present application. It thus considers that the applicant company’s remaining
complaints are admissible but that there is no need to give a separate ruling
on them (see Centre for Legal Resources on behalf of Valentin Câmpeanu
v. Romania [GC], no. 47848/08, § 156, ECHR 2014).

13
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

III. APPLICATION OF ARTICLE 41 OF THE CONVENTION

77. Article 41 of the Convention provides:

“If the Court finds that there has been a violation of the Convention or the Protocols
thereto, and if the internal law of the High Contracting Party concerned allows only
partial reparation to be made, the Court shall, if necessary, afford just satisfaction to the
injured party.”

A. Damage

1. The parties’ submissions

(a) The applicant company
78. The applicant company made the following claims in respect of
pecuniary damage.
79. Firstly, it claimed the amount it had been awarded by the ICC
Tribunal, that is a principal amount of 1,894,597.52 euros (EUR) and interest
of 14.25% per annum on EUR 1,853,584.45 for the period from
13 March 2009 until full payment of the award.
80. As regards this part of its claim, the applicant company pointed out
that Article 201 § 1 (b) of the Enforcement Code specifically excluded the
possibility of having enforcement proceedings reopened. It was accordingly
not possible for it to pursue its claim at the domestic level on the basis of
a finding of a violation of its rights by the Court.
81. Secondly, the applicant company claimed EUR 103,996.52 in
compensation for the costs of accounting and auditing services which in its
submission it had incurred on account of the violation complained of. In that
regard, the applicant company submitted that since 2012 its sole operational
purpose had been the collection of the adjudicated amount. Due to the ensuing
litigation, it had been prevented from winding down and had continued to be
bound by law to ensure accounting and auditing services, which had entailed
the costs in question.

(b) The Government

82. As to the former part of the claim, the Government proposed that the
best solution would be for the applicant company to lodge a new application
for enforcement of the award. There were no specific statutory rules
concerning the application of the principle of res judicata in enforcement
proceedings. A decision to terminate enforcement proceedings could in
principle be seen as a substantive decision preventing the initiation of new
enforcement proceedings. However, this should only apply if there was no
change in the relevant circumstances. The Court’s finding of a violation of
the applicant company’s fundamental rights should be accepted as a new

14
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

relevant circumstance in the light of which the principle of res judicata should
not preclude the opening of new enforcement proceedings.
83. As regards the second part of the claim, the Government contested its
causal link to the violations of the applicant company’s rights alleged in the
present proceedings before the Court.

2. The Court’s assessment

84. The Court reiterates that a judgment in which it finds a breach imposes
on the respondent State a legal obligation to put an end to the breach and
make reparation for its consequences in such a way as to restore as far as
possible the situation existing before the breach (see Iatridis v. Greece (just
satisfaction) [GC], no. 31107/96, § 32, ECHR 2000-XI).
85. In relation to the first part of the applicant company’s claim (principal
amount and interest under the award), the Court notes that it essentially
corresponds to what the applicant company would have asserted at the
national level, where it is prevented from doing so by the fact that the
enforcement proceedings have been terminated. Unlike with proceedings
before the ordinary courts where such a possibility is expressly provided for
by law (see, for example, Borovská and Forrai v. Slovakia, no. 48554/10,
§§ 76-77, 25 November 2014), in relation to enforcement proceedings the
national law specifically excludes the possibility of their reopening
(see paragraph 43 above), be it on the basis of a finding by the Court of
a violation of individual human rights or fundamental freedoms or otherwise.
The Government’s suggestion that the applicant company might seek
enforcement of the award by way of a fresh application on the basis of new
facts appears in substance to be akin to such a reopening. In the absence of
any regulatory framework or jurisprudential support, the Court is
unconvinced that such a possibility is in fact available.
86. The Government’s objection in relation to the second part of the claim
(accounting and auditing costs) consisted of arguing the lack of a causal
connection between such costs and the violations alleged. However, it has not
been contested that the applicant company’s sole purpose is the collection of
its claim under the award. Thus, the Court finds that had the awarded amounts
been paid, the applicant company’s continued existence would no longer have
been justified, it could have been wound up, and the expenses in question
would not have been incurred. Accordingly, in line with the restitutio in
integrum principle, the Court finds that a causal nexus between the costs in
question and the violation found has been established.
87. Nevertheless, as to the amount of the claim, the Court finds that the
question of the application of Article 41 is not ready for decision. It is
therefore necessary to reserve the matter, due regard being had to the
possibility of an agreement between the respondent State and the applicant
company (Rule 75 §§ 1 and 4 of the Rules of Court).

15
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

88. As no claim has been made in respect of non-pecuniary damage, there

is no call for any ruling in that respect.

B. Costs and expenses

89. The applicant company also claimed EUR 33,257.79 for the legal and
translation costs at the domestic level and EUR 287,316.38 for legal fees and
associated expenses incurred before the Court.
90. The Government requested that the matter be resolved in accordance
with the Court’s case-law. As to the claim concerning the proceedings before
the Court, the Government contested the amount as being manifestly
excessive and “speculative”. To that effect, while acknowledging that the
claim had been supported by invoices, they pointed out that no evidence had
been submitted that those invoices had actually been settled. Moreover,
arguing that the applicant company was in fact making a financial loss, the
Government found it incomprehensible that it should be hiring the most
expensive lawyers even though lawyers with Convention experience working
at much more reasonable rates were available on the market.
91. According to the Court’s case-law, an applicant is entitled to the
reimbursement of costs and expenses only in so far as it has been shown that
these were actually and necessarily incurred and are reasonable as to quantum
(see, for example, Iatridis, cited above, § 54).
92. Regard being had to the documents in its possession and the above
criteria, the Court considers it reasonable to award the sum of EUR 30,000,
plus any tax that may be chargeable to the applicant company, covering costs
under all heads, incurred up to the adoption of the present judgment.

C. Default interest

93. The applicant company submitted that the default interest in relation
to the above claims should be set at 9% per annum.
94. The Court considers it appropriate that the default interest rate should
be based on the marginal lending rate of the European Central Bank, to which
should be added three percentage points.

FOR THESE REASONS, THE COURT, UNANIMOUSLY,

1. Declares the application admissible;

2. Holds that there has been a violation of Article 1 of Protocol No. 1 to the
Convention;

3. Holds that there is no need to examine on the merits the complaints under
Articles 6 and 13 of the Convention;

16
 BTS HOLDING, A.S. v. SLOVAKIA JUDGMENT

4. Holds that the question of the application of Article 41 of the Convention

in relation to the amount of the claim in respect of pecuniary damage is
not ready for decision and accordingly:
(a) reserves the said question;
(b) invites the parties to submit, within six months from the date on which
the judgment becomes final in accordance with Article 44 § 2 of the
Convention, their written observations on the matter and, in particular,
to notify the Court of any agreement that they may reach;
(c) reserves the further procedure and delegates to the President of the
Chamber the power to fix the same if need be;

5. Holds
(a) that the respondent State is to pay the applicant company, within three
months from the date on which the judgment becomes final in
accordance with Article 44 § 2 of the Convention, EUR 30,000 (thirty
thousand euros), plus any tax that may be chargeable to the applicant
company, in respect of costs and expenses incurred up to the adoption
of this judgment;
(b) that from the expiry of the above-mentioned three months until
settlement simple interest shall be payable on the above amount at
a rate equal to the marginal lending rate of the European Central Bank
during the default period plus three percentage points;

6. Dismisses the remainder of the applicant company’s claim for just

satisfaction.

Done in English, and notified in writing on 30 June 2022, pursuant to

Rule 77 §§ 2 and 3 of the Rules of Court.

Renata Degener Marko Bošnjak

Registrar President

17