Dutch court docket backs $50bn Yukos declare in opposition to Russia

59
Yukos logo in July 2003, MoscowImage copyright AFP
Image caption Yukos was beforehand Russia’s largest oil and fuel agency

A Dutch court docket has upheld an enchantment by shareholders demanding billions of {dollars} in compensation from the Russian state for breaking apart the once-mighty Yukos oil firm.

The Appeals Court in The Hague stated a earlier Dutch court docket ruling in favour of the Russian state was incorrect.

Tuesday’s ruling restores the unique $50bn (£38bn) compensation award, made by the Permanent Court of Arbitration.

Russia now plans to enchantment, so the authorized wrangling is about to proceed.

Russia’s response makes it questionable whether or not any Russian state belongings overseas will be seized to implement the shareholders’ rights.

The Yukos affair turned a logo of President Vladimir Putin’s dedication to rein within the energy of billionaire oligarchs who obtained wealthy from controversial privatisation auctions within the 1990s.

Yukos Oil’s former chief Mikhail Khodorkovsky, a outstanding critic of Mr Putin, was arrested in 2003 and the agency went bankrupt in 2006.

In 2014 the Permanent Court of Arbitration (PCA), primarily based in The Hague, dominated that Russian officers had manipulated the authorized system to bankrupt Yukos. The chapter adopted a Russian authorities demand for billions of {dollars} in again taxes.

The PCA ruling was upheld by the appeals judges on Tuesday, who stated Russia was obliged to implement the 1994 worldwide Energy Charter Treaty, “unless it was in breach of Russian law”. “This court finds that there was no breach of Russian law,” they stated.

Mr Khodorkovsky spent 10 years in jail, earlier than being pardoned by Mr Putin, and now he lives in exile in London.

The bulk of the Yukos enterprise was taken over by state-run Rosneft, which is now one in every of Russia’s strongest vitality companies.

Image copyright AFP
Image caption Mr Khodorkovsky continues campaigning for a democratic different to President Putin

Mr Khodorkovsky transferred his Yukos stake in 2005 to his former Russian-Israeli enterprise associate Leonid Nevzlin, who now stands to be the principle beneficiary of the compensation. Mr Nevzlin, primarily based in Israel, heads the shareholders’ group known as GML.

Mr Khodorkovsky now runs a pro-democracy activist group known as Open Russia, which was blacklisted as an “undesirable organisation” by the Russian authorities in 2017.

In a tweet, Mr Khodorkovsky stated “the Kremlin has lost” and the court docket ruling “confirmed not just the legal case but the essence: ‘the seizure of Yukos is not about taxes, but about a battle with political opponents’.”

Russia’s justice ministry stated the federal government would enchantment, because the Dutch court docket had “failed to take into account the illegitimate use by former Yukos shareholders of the Energy Charter Treaty, that wasn’t ratified by the Russian Federation”.