A U.S. federal court has ruled in favor of Turkish company ENKA Renewables in its bid to enforce a 2024 international arbitration award of approximately USD 350 million plus interest against Georgia over the termination of a contract to build the Namakhvani Hydropower Plant, a planned hydropower project in western Georgia that was halted in 2021 following mass protests.
Georgian authorities pledged to appeal the U.S. court decision on enforcement, as Georgia’s challenge to the award remains before the Paris Court of Appeal, with a final ruling pending. The total sum of compensation, including interest, is expected to exceed USD 400 million.
The U.S. District Court for the District of Columbia, in its September 11 ruling, rejected Georgia’s request to dismiss the case or suspend proceedings pending its separate challenge to the award before the Court of Appeal of Paris. The court also ruled that post-judgment interest will accrue at the rate stipulated in the parties’ agreement – the Secured Overnight Financing Rate (SOFR) plus four percent.
The court ordered ENKA to submit a draft final order by September 18, reflecting “the final Award sum plus accrued interest through that date.”
The case stems from an arbitration initiated by ENKA Renewables in 2021 after it terminated the agreement for the construction of the Namakhvani Hydropower Plant amid mass protests against the project.
The Namakhvani project, awarded by the Georgian Government in 2019 to Turkey-based ENKA and Norway’s Clean Energy Group, envisaged two hydropower plants on the Rioni River in western Georgia — the 333 MW Lower Namakhvani HPP and the 100 MW Upper Namakhvani HPP. The government promoted the project as a major contribution to Georgia’s energy security and expected it to bring USD 800 million in foreign investment and create up to 1,600 jobs.
The project faced months of protests by local residents and activists, who raised concerns over environmental and social impacts, landslide risks, and provisions of the investment agreement they considered unfavorable to the state. Despite the European-led mediation efforts, in September 2021, ENKA notified the Georgian Government that it was terminating the contract, citing breaches of contractual terms and force majeure, pointing to prolonged public protests that hindered construction. ENKA subsequently formally terminated the agreement, with the dispute eventually proceeding to international arbitration.
In December 2024, the international arbitration seated in France found that Georgia had breached its commitments under the Build, Own, and Operate (BOO) Agreement and awarded ENKA approximately USD 350 million, plus interest. Following the arbitration award, Georgia sought its annulment before the Court of Appeal of Paris. In February 2026, the Paris court recognized the arbitral award for enforcement in France while pausing its enforcement pending the outcome of the proceedings.
U.S. Ruling Details
ENKA turned to the U.S. court to have the award recognized and enforced under the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, to which the United States is a party.
Georgia asked the U.S. court to pause the enforcement proceedings until the Court of Appeal of Paris rules on Georgia’s attempt to annul the arbitral award.
The U.S. court denied the request, noting that nearly four years had passed since the arbitration began, while the timeline for a decision following the Paris Court of Appeal’s final hearing in October 2025 has passed, and the court has yet to issue a decision. The U.S. court cited the need for the “expeditious resolution” of arbitration disputes and “the status of the foreign proceedings and the estimated time for those proceedings to be resolved.”
Georgia also challenged enforcement on several grounds, including arguing that the arbitral tribunal had violated “due process standards,” that the arbitral procedure had not complied with the parties’ agreement or applicable law, and that the award recognition would violate the U.S’s “public policy interest in respecting the right of other nations to control the extraction and [processing] of natural resources within their own sovereign territories.” The court rejected the challenges.
The parties also disagreed over the interest rate that should apply after the U.S. court’s judgment. The court agreed with ENKA, finding that the BOO Agreement established the applicable rate in “clear, unambiguous, and unequivocal language” and that the provision applied both before and after judgment.
Accordingly, the court awarded “post-judgment interest at the rate of SOFR plus four percent, accruing from day to day and compounding monthly.”
Tbilisi’s Response
Deputy Justice Minister Beka Dzamashvili said the Washington case “concerned only a procedural matter” related to enforcement of the 2024 arbitration award, and said Georgia would appeal it.
“As for the decision of the Washington court, it concerned only a procedural matter, because the other party did not wait for the proceedings in Paris to conclude and simultaneously attempted to have the award recognized – that is, to initiate enforcement proceedings,” he said.
“The main proceedings on this case are underway” before the Court of Appeal of Paris, he said, adding that Georgia does not expect a ruling there before the end of the year. Dzamashvili also said the U.S. ruling “is not a final decision” and that the government would appeal it.
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