01 EXECUTIVE SUMMARY
Igor Viktorovich Makarov is a Russian-born billionaire entrepreneur and founder of Itera, one of Russia’s first independent natural-gas companies. He subsequently developed the ARETI International Group and built interests across energy and investment-related businesses.
Makarov’s sanctions history is legally significant because it includes both designation and subsequent delisting, followed by litigation against Canada and, separately, an investor-State arbitration.
Canada originally designated Makarov in April 2022. On 4 August 2023, Canada removed him from its Russia sanctions schedule after determining that he no longer met the applicable nationality criterion following the renunciation of his Russian citizenship. On the same date, however, Canada separately adopted a new regulation that re-listed Makarov, relying on a different statutory basis and citing his historical associations with senior Russian officials and Russian energy interests.
This sequence ultimately generated domestic Canadian litigation. In August 2024, the Federal Court dismissed Makarov’s application for judicial review of the Minister’s refusal to recommend his removal. The Federal Court of Appeal dismissed his appeal in December 2025. As of October 2026, an application for leave to appeal remains before the Supreme Court of Canada.
Separately, Makarov commenced an investment arbitration against Canada under the Canada–Moldova Foreign Investment Promotion and Protection Agreement (FIPA). The case, Igor Viktorovich Makarov v. Canada, ICSID Case No. ARB/26/6, is active. Makarov claims not less than CA$350 million, alleging that Canada’s sanctions designation and subsequent conduct concerning his delisting applications breached Canada’s obligations under the treaty.
The case therefore raises an unusual legal question: to what extent can an investor-State treaty protect an investor against the economic consequences of a State’s sanctions regime?
02 IDENTITY & BUSINESS PROFILE
Forbes identifies Makarov as the founder of Itera, described as Russia’s first independent gas company. Itera became a major exporter of gas from Turkmenistan in the late 1990s and subsequently entered a joint venture with Rosneft. Rosneft acquired the remaining Itera interests in 2013 for approximately US$2.9 billion.
Makarov subsequently developed ARETI International Group, with business interests extending beyond the Russian energy sector.
Forbes currently estimates Makarov’s wealth at approximately US$2.4 billion and identifies him as a Cyprus citizen.
03 CANADIAN SANCTIONS HISTORY
Canada added Makarov to Schedule 1 of the Special Economic Measures (Russia) Regulations on 19 April 2022.
He was listed as Item 734.
The Canadian regulatory record identified him as a Russian national and stated that he was an associate of senior Russian government officials.
The 2022 regulatory package expressly described the individuals being added at that time as oligarchs, close associates of the Russian regime and family members.
On 4 August 2023, Canada removed Makarov from Schedule 1.
The reason was specific and legally important.
Canada stated that Makarov had confirmed that his renunciation of Russian citizenship had been finalized and that he had not resided in Russia since 2013.
The Canadian government therefore concluded that he no longer met the nationality criterion contained in the Russia Regulations.
This was not a judicial finding that his original designation had been unlawful. It was an administrative/regulatory determination that the statutory nationality criterion no longer applied to him.
On the same date, Canada adopted a separate regulatory instrument adding Makarov back to Schedule 1 as Item 1315.
The Canadian government relied on a different factual and regulatory basis.
The regulatory impact statement described Makarov as a Russian billionaire and founder and president of ARETI International Group and alleged that he had benefited from close associations with senior Russian officials and had brokered opaque Russian-Turkmen energy transactions.
Canada stated that these activities had generated revenues that the Kremlin had relied upon in connection with its activities in the region.
The relisting therefore transformed the legal issue.
The question was no longer simply whether Makarov remained a Russian national. It became whether the evidence supported his designation under the substantive sanctions criteria.
04 CANADIAN JUDICIAL REVIEW
Makarov challenged the Minister of Foreign Affairs’ refusal to recommend his removal from the Canadian sanctions list.
In Makarov v. Canada (Minister of Foreign Affairs), 2024 FC 1234, the Federal Court dismissed his application for judicial review on 7 August 2024.
The Court gave substantial deference to the Minister’s assessment of the evidence and concluded that the Minister’s decision was reasonable, justified, transparent and intelligible.
The Court specifically considered evidence concerning Makarov’s historical relationships and business connections, including reported links involving senior Russian officials and Russian energy interests.
The Court stated that it found no reviewable error in the Minister’s decision.
Makarov appealed.
On 9 December 2025, the Federal Court of Appeal dismissed the appeal in 2025 FCA 223.
The Court confirmed the importance of the Minister’s role in assessing the relevant record in the sanctions context and held that the evidence supported the decision under review.
The Court also noted that where new evidence establishes a material change in circumstances, Makarov may apply again under subsection 8(5) of the Russia Regulations.
Makarov subsequently sought leave to appeal to the Supreme Court of Canada.
The Supreme Court docket, file No. 42210, shows that the application for leave remains before the Court as of the latest publicly available docket information.
The existence of the application should not be confused with an appeal on the merits: the Supreme Court has not, on the present record, issued a merits judgment overturning the Federal Court of Appeal.
05 INVESTOR-STATE ARBITRATION AGAINST CANADA
Makarov filed a Notice of Intent to submit a claim to arbitration on 10 October 2025.
He subsequently filed his Request for Arbitration with ICSID on 14 January 2026.
The tribunal was constituted in June 2026.
The dispute is based on Makarov’s asserted status as a protected investor under the Canada–Moldova FIPA and concerns the economic consequences of Canadian sanctions and the conduct surrounding his attempts to obtain delisting.
Canada’s own official case description identifies the treaty provisions invoked by Makarov as:
- Article 4 — National Treatment
- Article 5 — Most-Favoured-Nation Treatment
- Article 6 — Minimum Standard of Treatment
- Article 10 — Expropriation
- Article 11 — Transfers
Makarov alleges that Canada’s measures deprived him of the value of his shareholding in Spartan Delta, an Alberta-incorporated company.
Canada records the amount claimed as no less than CA$350 million.
06 THE LEGAL SIGNIFICANCE OF THE ARBITRATION
The arbitration is potentially significant beyond Makarov personally.
The case raises a broader question concerning the interaction between:
international investment protection
and
sovereign sanctions legislation.
Canada is expected to rely on the character of sanctions as sovereign regulatory measures adopted in response to Russia’s invasion of Ukraine and under Canada’s domestic sanctions legislation.
Makarov’s case, by contrast, is structured under an investment treaty rather than solely under Canadian administrative law.
This creates two distinct legal frameworks.
The domestic proceedings ask whether Canadian authorities acted lawfully and reasonably under Canadian legislation.
The ICSID arbitration asks whether Canada’s conduct breached international obligations owed to a protected investor under the Canada–Moldova FIPA.
A finding in one proceeding would not automatically determine the result of the other.
07 CENTRAL JURISDICTIONAL QUESTIONS
Several issues may become decisive in the arbitration.
7.1 Investor status
A fundamental issue is whether Makarov qualifies as a protected investor under the Canada–Moldova FIPA for the relevant period.
His citizenship history is therefore legally important.
Public reporting identifies him as a Cyprus citizen following the renunciation of Russian citizenship. The arbitration record identifies Moldova and Cyprus in connection with his investor status.
The precise treaty basis for jurisdiction will need to be assessed against the factual and corporate structure existing at the relevant dates.
7.2 Protected investment
The arbitration identifies Makarov’s shareholding in Spartan Delta as the investment allegedly affected by Canada’s measures.
The tribunal will need to consider the legal status and ownership structure of that investment and the extent to which it falls within the treaty’s protected investment framework.
7.3 Attribution and treaty breach
Makarov must establish more than the existence of sanctions and economic loss.
He must establish that the conduct attributable to Canada violated one or more of the treaty standards invoked in his claim.
These include minimum standard of treatment, national treatment, MFN treatment, expropriation and transfers.
7.4 Causation and damages
The claimed amount — at least CA$350 million — makes valuation and causation particularly important.
The claimant would need to establish a sufficiently direct causal relationship between Canada’s measures and the alleged loss in the value of the investment.
The tribunal will also have to address the appropriate valuation methodology and any issues concerning mitigation, attribution of loss and alternative causes.
08 INTERNATIONAL SANCTIONS HISTORY
Makarov’s case is unusual because several jurisdictions that previously designated him subsequently removed him from their sanctions regimes.
The UK’s published statement of reasons had previously relied on his alleged involvement with ARETI International Group, New Stream and other entities operating in or connected with the Russian energy sector.
This distinction is important: the existence of sanctions in one Western jurisdiction should not automatically be interpreted as evidence of designation in every allied jurisdiction.
09 CURRENT LEGAL POSITION
As of 2 October 2026, the following matters should be distinguished:
10 LEGAL ASSESSMENT
Makarov’s case should not be characterized simply as a dispute over whether sanctions were justified.
The legal record demonstrates three separate stages:
Canada imposed sanctions based on its assessment of Makarov’s nationality, associations and business history.
Canada removed him after determining that he no longer met the nationality criterion, but re-listed him on a different substantive basis.
Makarov challenged the Canadian administrative decision in domestic courts and subsequently commenced an investment-treaty arbitration seeking substantial monetary damages.
This makes the case particularly relevant to the developing legal relationship between sanctions regimes and international investment protection.
The Federal Court and Federal Court of Appeal decisions do not determine the ICSID tribunal’s jurisdiction or the merits of Makarov’s treaty claims.
Conversely, commencement of the ICSID arbitration does not establish that Canada breached the FIPA.
Those questions remain for the arbitral process.
11 KEY QUESTIONS FOR SANCTIONS REVIEW
The Makarov case raises several questions of broader relevance:
- Can an investor protected by an investment treaty seek compensation for losses caused by targeted sanctions?
- How should an investment tribunal distinguish legitimate sanctions regulation from conduct that breaches investment-protection standards?
- Does subsequent delisting affect the legality of an earlier designation?
- How should an arbitral tribunal assess causation where sanctions affect an investment indirectly?
- Can historical business relationships remain legally relevant after a person changes citizenship and residence?
- What happens when domestic courts defer substantially to the executive’s sanctions assessment while an international tribunal independently assesses treaty obligations?
- To what extent can national-security and foreign-policy considerations affect the application of investment treaty standards?
12 CONCLUSION
Igor Viktorovich Makarov represents an unusually significant sanctions-related legal case.
His history combines designation, delisting, immediate relisting, domestic judicial review and a live international investment arbitration seeking at least CA$350 million.
The Canadian courts have so far upheld the Minister’s decision under the domestic judicial-review framework.
The separate ICSID proceedings remain active and involve a different legal question: whether Canada’s conduct breached obligations owed to Makarov under the Canada–Moldova FIPA.
At this stage, the arbitration should therefore be treated as an active unresolved international investment dispute, not as a finding that Canada acted unlawfully or that Makarov is entitled to compensation.
For sanctions-policy and international-investment observers, the eventual outcome may be relevant to the broader question of how investment treaties interact with modern targeted sanctions regimes.
- Government of Canada — Igor Makarov v. Canada, ICSID Case No. ARB/26/6.
- Canada Gazette — SOR/2022-84.
- Canada Gazette — SOR/2023-174.
- Canada Gazette — SOR/2023-176.
- Federal Court of Canada — Makarov v. Canada, 2024 FC 1234.
- Federal Court of Appeal — Makarov v. Canada, 2025 FCA 223.
- Supreme Court of Canada — File No. 42210.
- ICSID — Igor Viktorovich Makarov v. Canada, ARB/26/6.
- UK Foreign, Commonwealth & Development Office — Russia Sanctions List / delisting notice.
- Forbes — Igor Makarov profile.