Aletho News

ΑΛΗΘΩΣ

Russia ready to ‘fight off’ Western attempts to seize its assets in $50bn battle with oligarchs over collapsed Yukos oil empire

RT | December 29, 2020

Any hope of a quiet 2021 for Russia has been dashed as one of the country’s top officials warns it faces a series of court battles that risk confrontation with the West, including a fight over the world’s largest legal bill.

In an interview published by Moscow news agency Interfax on Tuesday, Deputy Justice Minister Mikhail Galperin said that litigation over the collapsed Yukos oil empire and fallout from Russia’s 2014 reabsorption of Crimea means that “a tough year” is on the cards.

The long-running dispute over Yukos, once among Russia’s leading energy firms and one of the most valuable companies in the world, has been raging for years. However, it now appears to be coming to a head as the Supreme Court of the Netherlands, which claims it has jurisdiction in the case, prepares to hear an appeal from Russia’s lawyers. A legal settlement of more than $50 billion, thought to be the largest in history, hangs in the balance.

“Of course, we’re not sitting idly, waiting for the Supreme Court’s decision,” said Galperin. “Every day, we’re defending our national interests in this case in different ways. Legal battles related to the Yukos case are taking place not only in the Netherlands, but in other jurisdictions as well.”

Those who lost money in the collapse of the Yukos empire insist that the arrest of its CEO on fraud charges and a colossal bill in back-taxes amounted to state appropriation.

Russian authorities argue that previous rulings in foreign courts on the side of the claimants failed to take into account Russia’s anti-corruption laws, and claim that the investors weren’t “bona fide.” Moscow also insists that only Russia’s courts have jurisdiction, as the Energy Charter Treaty under which the case is being brought was signed but never ratified.

Galperin added that the country’s “main legal argument is that Russia never agreed for the case to be heard by an international court of arbitration, which means that the judges had no mandate to consider the lawsuit Yukos ex-shareholders filed against Russia.”

Last week, one of Russia’s highest judicial authorities ruled that the country should disregard any judgement coming from overseas tribunals. They state that, while the government of the day took steps to join the Energy Charter Treaty in 1994, they did not have the authority to make national laws subject to international agreements, or to “challenge the competence” of Russian courts. Therefore, the jurists conclude, adhering to the Dutch court’s demands would be “unconstitutional.”

However, if the verdict goes in favor of Yukos’ former shareholders, refusing to pay the bill could have substantial repercussions for Russia, with the claimants already calling for the confiscation of the country’s assets overseas as collateral.

Galperin, however, is confident that Russia could avoid cash and property falling into the hands of the oligarchs who have brought the case. “Since 2014,” he said, “they have made multiple unscrupulous attempts to seize not only state property, but also assets that belong to Russian companies in Western Europe. We have successfully repelled all these assaults.”

“While we can’t rule out that in 2021 YUKOS ex-shareholders will continue their legal battle in a number of countries, I can tell you without unnecessary bravado that we are fully prepared to fight off any attempts to seize our property in any country of the world.”

The Supreme Court of the Netherlands is expected to hear the case in February next year, while simultaneous battles have also been fought in US and British courts. The row comes at a time when tensions between Russia and the West are growing, with Moscow’s diplomats arguing that verdicts against the country have been “politically motivated.” In December, Justice Minister Konstantin Chuychenko told journalists that the case is part of a “legal war that has been declared on Russia.”

As well as the Yukos case potentially reaching a dramatic climax, Galperin expects that his ministry will have their hands full next year with at least two other international disputes. As early as January, the European Court of Human Rights is expected to announce a decision on a legal fight between Moscow and Kiev over disputed Crimea. There is a further $8 billion claim from a Ukrainian energy firm that insists it lost its assets when the peninsula was reabsorbed into Russia. The same court will also rule on a case brought by Georgia over events in South Ossetia and Abkhazia in 2008.

December 29, 2020 - Posted by | Economics | , ,

No comments yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.