September 09, 2019 20:32
Hague court to be shown new evidence of Yukos ex-shareholders' illegal operations - Russian rep (Part 2)
MOSCOW. Sept 9 (Interfax) - Russia will file new evidence with The Hague Court of Appeal in late September showing that former Yukos shareholders acted illegally during the privatization of the oil company, according to Andrei Kondakov, head of the International Legal Aid Center which represents the interests of the Russian state.
"On September 23-24 and 30, The Hague of Appeal will hold the final round of hearings on the appeal filed by the former Yukos majority stakeholders against a ruling by the District Court of The Hague," which in April 2016 overturned a ruling by the city's court of arbitration which ordered Russia to pay $50 billion in damages, Kondakov told Interfax on Monday.
"Since then, new evidence has been gathered of the Yukos ex-shareholders' illegal operations relating primarily to this company's privatization, which involved conspiracy and bribing, mass tax evasion, withdrawing its assets abroad, and laundering illegal proceeds," Kondakov said.
The evidence will also list "instances of the former Yukos shareholders abusing international justice mechanisms," including " knowingly submitting false information on arbitrators, methods of gaining control over Yukos assets, and its end beneficiaries, the creation of a foreign network of front companies for this internal dispute between the Russian company and [Russian] tax authorities to be classed as international, the unlawful use of the Energy Charter Treaty mechanisms that are solely applicable for protecting conscientious foreign investors, which the front companies controlled by Yukos oligarchs never were," Kondakov said.
He hopes that the Court of Appeal "will take account of said circumstances and uphold the previous court decision to cancel the arbitration rulings and finally put a full stop to the drawn-out litigation."
The Yukos dispute is "unprecedented" for international investment arbitration, the lawyer said.
In 2005, the subsidiaries, Group Menatep Limited - Hulley Enterprises (Cyprus) and Yukos Universal Ltd. (the Isle of Man), which jointly had a 51% stake in Yukos, filed a claim against Russia with the Hague court, demanding that $28.3 billion in damages be awarded. The total amount of claims against Russia, including the claim lodged by the Yukos pension fund Veteran Petroleum Ltd., was $33.1 billion. The amount claimed increased as time passed.
The Hague Court of Arbitration upheld those companies' claims in July 2014 and compelled Russia to pay $50 billion. Russia filed three appeals to overrule arbitration judgments with the Hague District Court in November 2014. Nevertheless, former Yukos shareholders refused to wait for a decision on the Russian appeal and initiated the enforcement of the ruling by courts of the United States, France, Belgium, Germany, and the United Kingdom in June-August 2015.
The Hague District Court repealed the arbitration rulings on April 20, 2016. According to Kondakov, the Hague District Court upheld Russia's appeal on the basis of one out of six arguments: it believed that the argument sounded convincing and did not waste time on hearing the other five.
Over the following 18 months, all lawsuits filed to seize Russian assets in Germany, India, France, and Belgium were either withdrawn by plaintiffs or thrown out by judges in those countries.
Currently, the enforcement proceedings against Russia initiated by former Yukos shareholders, have been either suspended or terminated.
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