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3 November 2021

Sayenko Kharenko secured victory for OLFA (Ukraine) in an international arbitration case for recovery of approximately EUR 3 million in damages from Olainfarm (Latvia)

Sayenko Kharenko arbitration team has successfully defended interests of OLFA LLC (“OLFA”) in the International Commercial Arbitration Court at the Ukrainian Chamber of Commerce and Industry (the “ICAC”). ICAC has awarded to OLFA, the Ukrainian distributor of medical and pharmaceutical products, approximately EUR 3 million in damages in the case against Latvian company Olainfarm JSC (“Olainfarm”).

The complex dispute in respect of a long-term contract for supply of medicines and medical products to Ukraine was pending before the ICAC for over a year within the frame of two parallel cases. Comprehensive consideration of the cases involved numerous experts and witnesses from each side. The arbitrators have also made determinations on the complex legal and factual matters, including the law applicable to the dispute and the amount of damages incurred by OLFA.

In the first case, OLFA filed a claim with the ICAC to recover a penalty for non-delivery of goods and damages incurred in 2020 as a result of Olainfarm’s breach of contract. The ICAC accepted OLFA’s position and found Olainfarm in violation of the long-term contract, namely due to its unjustified refusal to perform. As a result, OLFA was awarded damages (lost profit incurred in 2020) in the total amount of approximatelyEUR 3 million, as well as the contractual penalty.

Such positive result was secured by the proactive position and case strategy in the ICAC developed by Sayenko Kharenko in cooperation with the client. During the case consideration, Sayenko Kharenko engaged a number of witnesses and authoritative experts. The expert and witness evidence was one of the main factors which led the arbitral tribunal to accept the validity of OLFA’s claim.

Currently OLFA is seeking enforcement of the award against Olainfarm. Also, OLFA has already started the process of recovery of the additional damages incurred due to Olainfarm’s continuous violation of the contract in 2021.

Sayenko Kharenko team working on the project included senior associates Andriy Stetsenko and Dmitriy Riabikin, associates Alina Danyleiko and Yaroslava Frank, as well as junior associate Yuliia Pavlova, under the general supervision of counsel Volodymyr Yaremko.

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