Electric Networks of Armenia JSC's license for electricity distribution revoked

YEREVAN, November 17. /ARKA/. On Monday, the Armenian Public Services Regulatory Commission (PSRC) decided to revoke Electric Networks of Armenia CJSC's electricity and capacity distribution license.

The decision was approved by commission members following a three-day discussion. PSRC Chairman Mesrop Mesropyan and three members voted in favor of revoking the license, while another commission member, Ara Nranyan, voted against.

According to Nranyan, several questions arose during the discussion that need to be answered. He noted that both the Constitutional Court and the Administrative Court are continuing to hear cases whose outcomes may be directly related to the proceedings concerning the Electric Networks of Armenia.

On July 15, opposition factions in the National Assembly filed a complaint with the Constitutional Court of Armenia challenging the constitutionality of the law allowing the authorities to nationalize ENA. On August 9, a lawsuit was filed with the Administrative Court of Armenia on behalf of Narek Karapetyan, CEO of Tashir Capital (a part of Tashir Group), against the PSRC and its chairman, Mesrop Mesropyan, demanding that the commission be declared ineligible to replace the company's management (on July 18, Mesropyan appointed Romanos Petrosyan as ENA's interim manager - ed.).

"If the Constitutional Court finds any provision of the legislative amendments (regarding the nationalization of ENA - ed.) unconstitutional on December 16, then the current process could become unconstitutional. According to legal regulations, in such cases, proceedings against the PSRC must be terminated or suspended," Nranyan stated at the PSRC meeting.

He added that the proceedings were initiated "based on assumptions by the authorized body" and did not comply with the PSRC's methodology. Furthermore, Nranyan stated, the other party to the proceedings was essentially absent, and no corrections were submitted, which could lead to the decision being challenged in the future.

Nranyan believes that the Commission should have considered other sanctions for violations, rather than revoking the license, as this would render the company's activities illegal.

During the administrative proceedings, PSRC specialists conducted three monitoring sessions over four months. According to the decision, the violations identified included the permanent deletion of electricity meter data (in 2018-2024), disruptions in the implementation of investment programs, falsifications, deficiencies, and other falsifications of electricity meter readings, violations of deadlines and procedures for connecting new subscribers, and violations of building and fire safety regulations during the construction and renovation of certain facilities.

The commission claims that ENA provided risky credit guarantees through commercial banks to a number of affiliated companies and ineffectively managed property, real estate, and cash. The PSRC decision asserts that the company jeopardized not only the safety of its assets, but also the uninterrupted and efficient electricity supply to consumers and the stability of the country's energy system as a whole.

ENA representatives disagreed with the presented findings. In particular, David Ghazinyan, former acting CEO of ENA and the company's Sales Director, questioned the accuracy of the sample and the results of the PSRC's research.

Lawyer Aram Orbelyan questioned the quality of the inspections and assessments, calling the conclusions stated in the PSRC decision unfounded. He stated that it is difficult to assess the company's degree of culpability for the violations attributed to it.

The Electric Networks of Armenia CJSC manages medium and low-voltage distribution networks in Armenia, serving approximately 1 million customers. Since 2016, ENA's owner, Tashir Group, has invested approximately $680 million in modernization alone, with an additional $150-200 million invested in creating new capacity.

Tashir Group President Samvel Karapetyan has been in custody since June 18, 2025. By decision of the Anti-Corruption Court, his arrest has been extended until November 17. He is charged with three counts: "public calls for the seizure of power" (following his statements about his support for the Catholicos of All Armenians and the Armenian Apostolic Church), large-scale tax evasion, and money laundering.

Earlier, Armenian Prime Minister Nikol Pashinyan suggested the possibility of nationalizing ESA or selling it to "an international, reputable specialized company, while retaining the government's stake." He stated that the decision regarding ENA depends on the price, which must be determined based on a comprehensive analysis.-0-