YUKOS owners win ruling in $100 billion case against Russia
The Russian government demanded billions of dollars in tax from YUKOS in 2003 in a move which led to the company's bankruptcy and the jailing of top owners Mikhail Khodorkovsky and Platon Lebedev on tax evasion and fraud charges.
Khodorkovsky denied the accusations and said the destruction of YUKOS, which was eventually bought by state oil major Rosneft , was motivated by his political opposition to then-President Vladimir Putin.
A tribunal of the Permanent Court of Arbitration (PCA) in The Hague ruled on Monday that Russia was bound by the Energy Charter Treaty (ECT), despite having never ratified the document, YUKOS's top shareholder GML said.
GML will have to go through two more stages in The Hague, which would take another two to three years, before claiming full victory in its battle, said Tim Osborne, a director at GML.
"Ultimately we would go after the Russian assets whenever we can find them," said Osborne. Russian Prime Minister Vladimir Putin's spokesman, Dmitry Peskov, declined to comment on the ruling and GML's comments.
Some of Khodorkovsky's former partners, such as Leonid Nevzlin, fled Russia and promised a "life-time litigation" over YUKOS, at that time Russia's largest oil firm. The arbitration began in 2005.
International investors, including U.S. pensions funds, were spooked by the fall of the country's largest private company, which had a market value of over $40 billion before the state began its tax case.
Kremlin critics said the YUKOS campaign marked a turning point in Putin's presidency and was a deliberate move to curb the power of so-called oligarchs and bring key sectors of the economy back under state influence.
Putin has said the tycoons were prosecuted according to the law and sentenced fairly.
TheNov. 30ruling, unavailable on the PCA web site but confirmed by the non-affiliated Energy Charter Secretariat in Brussels, stated that Russia is bound by its 1994 signatory membership in the Energy Charter Treaty (ECT).
The ECT - established in 1991 to take into account "the problems of reconstruction and restructuring in the countries of Central and Eastern Europe and in the USSR" - provides for the protection of foreign investments and dispute resolution between 51 European countries, including Russia.
Russia opted out of its signatory status in August this year and its provisional membership in the Energy Charter expired on Oct. 18.
Osborne said that GML would now have to prove in the same court in The Hague that it had been discriminated against during the YUKOS demise and then win an enforcement of the award.
Should GML win all rulings in two to three years, it would get the right to go after Russian assets abroad, except for diplomatic assets, if Moscow declines to redeem damages, he said.
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