Russian billionaire Mikhail Fridman's $16 billion claim still hangs over Luxembourg

Russian billionaire Mikhail Fridman, the co-founder of Alfa Group, has not withdrawn his $16 billion arbitration claim against Luxembourg, three weeks after the Grand Duchy helped secure his removal from the European Union's sanctions list.

Fridman "is currently assessing his legal strategy," his lawyer, Aaron Bass of the Paris law firm Kiejman & Marembert, told Luxembourg business publication Paperjam on Tuesday. "He acknowledges the positive role played by Luxembourg in the lifting of the sanctions," Bass said. The lawyer did not say whether Fridman would pursue, change or drop the claim, and Paperjam noted that the lifting of sanctions does not by itself end the arbitration.

The claim, worth about €13.8 billion, is close to the size of Fridman's entire fortune. Forbes valued the 62-year-old at $16.7 billion on Oct. 4, ranking him 163rd in the world.

Luxembourg's bet

The EU Council removed Fridman and fellow Russian billionaire Alisher Usmanov from its Russia sanctions list on Sept. 22, as part of a deal that extended the remaining listings, which cover about 3,000 people and entities, until Sept. 22, 2029. Renewal requires the backing of all 27 member states. France and Slovakia had pushed for Usmanov's removal, and Luxembourg pressed for Fridman's, Bloomberg reported, citing people familiar with the talks.

Luxembourg Prime Minister Luc Frieden has said publicly that the decision was in the country's "best interests," without linking it to the arbitration, according to Paperjam. He said the decisions were taken in consultation with European partners and after direct talks with Ukraine's president and foreign minister, and he reaffirmed Luxembourg's support for Ukraine.

In private, Frieden went further. At a closed meeting of parliament's foreign affairs committee on Oct. 12, he cited the national interest and said the aim was to make Fridman's arbitration go away, given the size of the claim relative to Luxembourg's national budget, according to opposition lawmaker Sam Tanson of the Greens, as reported by the Kyiv Independent. Franz Fayot, a Socialist lawmaker and former economy minister, said Frieden described his own calculation as "opportunistic," the outlet reported.

The government has had no contact with Fridman or his legal team, and the arbitration has not been withdrawn, the Kyiv Independent reported, citing the lawmakers. Frieden also said there was "no solidarity at EU level for any damage" Luxembourg might have to pay, according to the report. When Tanson raised the European Commission's position that EU sanctions include a "no-claims clause" shielding member states from such demands, Frieden said he was "not aware of such a rule," she said.

Fayot said the move "set a dangerous precedent," while Tanson said it sent the "wrong signal" to Russia and Ukraine. Ukrainian Foreign Minister Andrii Sybiha called the delisting "a wrong decision." Frieden's head of communications did not respond to the Kyiv Independent's request for comment.

The arbitration

Fridman filed the claim in August 2024 under a 1989 investment protection treaty between the Belgium-Luxembourg Economic Union and the Soviet Union, seeking compensation for the freezing of his assets in Luxembourg and damage to his business. It is the first and only case against Luxembourg in the United Nations Conference on Trade and Development's database of investor-state disputes, the Luxembourg Times reported last year.

A three-member tribunal was formed in November 2025, led by Joongi Kim, a law professor at Yonsei University in Seoul. Fridman nominated Gourab Banerji of Essex Court Chambers, and Luxembourg nominated Klaus Sachs of the law firm CMS. Luxembourg is represented by A&O Shearman. The case is at an early stage, and its filings are not public.

Fridman, who holds Russian and Israeli citizenship, built Alfa Group into one of Russia's largest private conglomerates, with interests in banking, retail and telecommunications. The EU sanctioned him in February 2022 after Russia's full-scale invasion of Ukraine. He argued in court that his listing rested on his prominence rather than evidence that he supported the war, and in April 2024 the EU's General Court annulled his listings covering February 2022 to March 2023, although the sanctions stayed in place under later renewals until last month.