On 7 July 2026, the AIFC Court set aside its own earlier order of 15 May 2026 that had recognised and permitted enforcement of a USD 1.4 billion ICC arbitral award in the Naftogaz v Gazprom proceedings, finding that it lacked jurisdiction to enforce awards rendered outside Kazakhstan. The ruling confirms that the AIFC Court is not a route for recognising or enforcing foreign-seated arbitral awards in Kazakhstan; international creditors holding such awards must proceed through the Kazakhstani state court system under the New York Convention. Any company that had been planning to use the AIFC Court to collect on a foreign award or to pursue asset freezing measures in support of such an award should reassess its enforcement strategy immediately.
The Proceedings: A Rapid Sequence of Decisions
The case, formally recorded as AIFC-C/CFI/2026/0002, arose from a long-running dispute between the Ukrainian state energy company Naftogaz and Gazprom. An ICC tribunal seated in Switzerland issued an award of approximately USD 1.4 billion on 16 June 2025. Naftogaz then applied to the AIFC Court in Astana to have that award recognised and enforced in Kazakhstan.
On 15 May 2026, Justice Andrew Spink KC granted the recognition and enforcement order. That decision appeared, at least initially, to signal that the AIFC Court could serve as a platform for enforcing significant foreign awards against assets located in Kazakhstan – a development that attracted considerable attention from international creditors and their advisers.
Less than two months later, on 7 July 2026, Lord Faulks KC set that order aside. The court found that it did not possess jurisdiction to recognise or enforce awards where the seat of the arbitration was outside Kazakhstan. The Kazakhstan Ministry of Justice had separately stated that the AIFC Court does not form part of the Kazakhstani state court system. Those two positions, taken together, define the boundaries within which foreign creditors must now operate.
Why This Matters Beyond the Naftogaz Case
The significance of this ruling extends well beyond the immediate parties. The AIFC Court operates on a common law basis with international judges and has positioned itself as an accessible, English-language forum for cross-border commercial disputes in Central Asia. Many international companies had been watching Naftogaz v Gazprom closely, hoping that a successful recognition would establish a workable shortcut for enforcement of judgment and payment order proceedings against counterparties with Kazakhstani assets.
The 7 July decision closes that route. Its practical consequences include:
- No AIFC-based enforcement path for foreign awards. Creditors holding ICC, LCIA, SCC, or other internationally seated awards cannot obtain a Kazakhstani enforcement order through the AIFC Court. This applies regardless of the award amount or the identity of the debtor.
- New York Convention route remains the operative mechanism. Recognition and enforcement of foreign awards in Kazakhstan must proceed through the state courts under Kazakhstan's obligations as a signatory to the New York Convention. Timelines and procedural requirements are set by Kazakhstani civil procedure law and, where applicable, bilateral or multilateral treaties.
- Asset freezing applications need to be re-routed. Any interim relief sought in connection with a foreign award – including measures to preserve assets, freeze accounts, or restrain disposals pending enforcement – will need to be grounded in the appropriate state court jurisdiction rather than an AIFC filing.
- Domestic AIFC arbitration awards are a separate matter. Awards issued by the AIFC-supervised Astana International Arbitration Centre (IAC) or by the Astana Financial Services Authority (AFSA) dispute resolution body may be subject to different treatment; creditors should not assume the 7 July ruling affects those enforcement routes without specific legal advice.
- Unpaid invoice and debt collection strategies require review. Companies that had factored in the possibility of AIFC Court enforcement when structuring their Kazakhstan-related contracts, guarantees, or debt collection procedures should revisit those documents and the jurisdictional clauses within them.
If your business holds a foreign arbitral award against a counterparty with assets in Kazakhstan, or if you are monitoring the status of late payment interest claims or enforcement proceedings in the region, our team is available to discuss how this ruling affects your position. Please write to info@ferrazwhitmore.com or visit our contacts page.
Immediate Actions for International Companies
Given the speed with which this jurisdictional position shifted – from recognition order to set-aside in under two months – companies with exposure in Kazakhstan should act promptly on the following:
- Audit existing enforcement filings. If any application was made to the AIFC Court relying on the 15 May order as precedent, or if proceedings are pending in anticipation of a similar outcome, those filings should be reviewed against the 7 July ruling without delay.
- Identify the correct state court competence. For most foreign awards, the relevant Kazakhstani state court will need to be identified based on the location of the debtor's assets or registered seat. Your Astana-based legal counsel should confirm the applicable venue and procedural steps under the New York Convention framework.
- Check limitation and procedural deadlines. Debt collection and enforcement proceedings in Kazakhstan are subject to strict time limits. A period spent pursuing the wrong forum can consume time that may be difficult or impossible to recover if deadlines are missed. Verify the applicable periods as a matter of priority.
- Review arbitration and jurisdiction clauses in new contracts. If you are currently negotiating Kazakhstan-related agreements, consider whether the seat of arbitration and any enforcement gateway clauses remain appropriate in light of this ruling. Selecting a Kazakhstan-seated arbitration body such as the IAC may alter the enforcement analysis.
- Assess sanctions and trade compliance dimensions. In cases where the counterparty is subject to international sanctions or where enforcement intersects with restricted assets or entities, additional legal layers apply. The Naftogaz v Gazprom dispute arose in a context with significant sanctions considerations, and creditors in comparable situations should ensure their enforcement strategy is consistent with applicable restrictions.
For a more detailed analysis of the jurisdictional framework and the limits this ruling places on foreign award enforcement in Kazakhstan, see our in-depth note at AIFC Court: Limits on Enforcing Foreign Awards in Kazakhstan.
The Broader Context: AIFC Court, State Courts, and the New York Convention
The AIFC Court was established as part of Kazakhstan's Astana International Financial Centre, modelled in significant respects on the DIFC Courts in Dubai and the ADGM Courts in Abu Dhabi. It applies common law, hears cases in English, and draws on an international judiciary. For disputes arising within the AIFC framework, it offers genuine procedural advantages over the Kazakhstani civil procedure system.
However, the 7 July ruling clarifies that the AIFC Court's competence does not extend to enforcing awards from arbitrations seated elsewhere. The Kazakhstan Ministry of Justice's formal position – that the AIFC Court is not part of the state court system – reinforces this boundary. It means the AIFC Court cannot exercise the functions that Kazakhstani state courts perform as courts of the enforcing jurisdiction under the New York Convention.
International creditors familiar with enforcement through the DIFC Courts, which have developed a well-established "conduit jurisdiction" model, should be aware that the AIFC Court has not adopted – or has not been permitted to adopt – an equivalent approach, at least for foreign-seated awards. Whether future legislative reform or case law development might alter this position remains to be seen; for now, practitioners should proceed on the basis of the current ruling.
Companies with ongoing or anticipated debt collection needs in Kazakhstan, concerns about unpaid invoice recovery, or exposure to counterparties whose assets are held in Astana or elsewhere in the country are encouraged to seek specific advice on the state court enforcement route. Our Kazakhstan practice can be reached at info@ferrazwhitmore.com or through our contacts page.
Sanctions and Trade Compliance Considerations
The Naftogaz v Gazprom proceedings sit at the intersection of enforcement law and a heavily sanctioned commercial context. Gazprom and affiliated entities are subject to extensive EU, US, UK, and other international sanctions measures. Any creditor or law firm involved in enforcement proceedings touching sanctioned parties or assets must ensure that their activities are consistent with applicable restrictions and that any licences or authorisations required have been obtained.
This is not a theoretical concern. Enforcement actions – even those that are legally well-founded under the New York Convention or domestic civil procedure – can trigger sanctions compliance obligations, require specific legal authorisations, or expose parties to secondary sanctions risk depending on the jurisdiction in which they operate. Careful sequencing of enforcement and sanctions compliance work is therefore essential.
For guidance on how Kazakhstan-related enforcement intersects with international trade restrictions and sanctions programmes, see our sanctions and trade compliance practice in Kazakhstan. Our team can assist with structuring enforcement approaches that account for both the jurisdictional constraints confirmed by this ruling and the applicable sanctions framework.
How Ferraz & Whitmore Can Assist
Our debt recovery and enforcement practice in Kazakhstan advises international companies and funds on the full spectrum of creditor-side issues: from the initial assessment of an award or payment order through to execution against assets in Kazakhstani jurisdiction. We work with local state court counsel and monitor AIFC Court developments on a continuous basis.
If this alert raises questions about your existing proceedings, pending enforcement strategy, or the structuring of new Kazakhstan-related contracts, we welcome the opportunity to discuss your situation. Please contact us at info@ferrazwhitmore.com or through our contacts page.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.