International human rights advocate and lawyer Robert Amsterdam stated: “Property rights are not a political toy. As an international lawyer who has defended individuals subjected to political persecution and state pressure for over 40 years, including private company owners, I have repeatedly witnessed how economic disaster begins.
Economic disaster never strikes suddenly; it starts quietly when the government, under the guise of ‘law,’ seeks political revenge and attempts to openly appropriate what does not belong to it. The developments currently unfolding in Armenia regarding ‘Electric Networks of Armenia,’ ‘Ararat Cognac-Wine-Vodka Factory,’ ‘Ararat Cement,’ and ‘Multi Wellness’ are familiar to me down to the last detail. This is a classic case of ‘creeping expropriation.’
What does this mean in practice?
When the government questions the operations of strategic/private companies for political reasons, criminal and tax proceedings become tools of pressure, and the management of private assets is handed over to state bodies through the courts, this constitutes a direct violation of property rights. In my practice, I have encountered this in various parts of the world. A vivid example is the case of ‘YUKOS’ in Russia, where the state also seized private assets under ‘legal formalities.’ The result was a massive capital flight and the destruction of the country’s rating.
The same tragic scenario occurred in Venezuela, where the nationalization of energy and industrial giants led to production collapse and widespread economic crisis. In Moldova and many Eastern European countries, private assets taken under state control for political reasons quickly turned into ineffective management and new corruption schemes.
I believe there is no need to look far; the example of ‘Haypost,’ which is currently at the center of political discussions and discourse, should already concern Armenian society. Regardless of what answers will be provided to the emerging corruption allegations and discussions, the fact is that a company taken from a private owner and placed under state control is currently operating at a loss.
What awaits such an Armenia if this is not stopped?
Billions of dollars in losses at the taxpayers’ expense. International arbitration courts (ICSID, UNCITRAL) do not tolerate politically motivated expropriations. States that go down this path ultimately lose and are forced to pay huge compensations from their budgets, meaning from the pockets of citizens.
The end of investments: No serious international investor will invest a single dollar in a country where the rules of the game change for political reasons, and private property can be seized at any moment.
Electric Networks of Armenia and other major companies are not just assets; they are the economic backbone of the country. Using property rights as a tool for political revenge is a blow not only to individual businessmen but also to Armenia’s future and security.”
