A US court agreed to consider the claim of ex-YUKOS shareholders against the Russian Federation for $50 billion

A US court agreed to consider the claim of ex-YUKOS shareholders against the Russian Federation for  billion

The US District Court for the District of Columbia rejected Russia’s request to recognize the $50 billion dispute with ex-YUKOS shareholders as not subject to jurisdiction. Thus, Judge Beryl Howell did not recognize the Russian Federation’s right to sovereign immunity in the United States, reports RBC with reference to court materials.

The dispute concerns a decade-long dispute in an international arbitration court in The Hague, which in 2014 awarded ex-YUKOS shareholders $50 billion in compensation for the “expropriation” of the company. According to Reuters, the amount of compensation during this period reached $60 billion including interest. Russia refused to pay compensation, and therefore ex-YUKOS shareholders initiated proceedings in a number of jurisdictions, including the United States. The decisions of the Hague court are still being challenged by Russia in the Dutch judicial system.

Moscow filed a petition with the US court back in 2015. During the hearing, the parties presented more than 400 pages of basic materials, more than 1 thousand pages of additional materials and more than 100 thousand pages of appendices, according to court documents. “This case may now proceed to the merits to determine whether the final judgments should be enforced under the New York Convention,” the judge said in his reasoning.

By December 5, the parties must provide a mutually agreed upon schedule for consideration of “final issues.” The result will be either the satisfaction of the ex-shareholders’ request for recognition and enforcement of the 2014 arbitration awards in the United States, or the satisfaction of the Russian Federation’s request to refuse recognition of these arbitration awards.

London High Court in early November decidedthat Russia cannot rely on state immunity to avoid enforcement of the decision of the international arbitration court in The Hague to pay almost $60 billion in compensation to former Yukos shareholders. In October, the Russian side stated at a meeting of the High Court in London that Russia does not intend to submit to the jurisdiction of arbitration.

About the proceedings – in the material “Kommersant” “YUKOS is back in business”.

Leonid Uvarchev

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