Why Russia Lost In The Yukos Case

Why Russia Lost In The Yukos Case
Why Russia Lost In The Yukos Case

Video: Why Russia Lost In The Yukos Case

Video: Why Russia Lost In The Yukos Case
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In 2007, the law firm Covingtoh & Burling LLP, representing the interests of seven Spanish investors - Yukos shareholders, filed a lawsuit against Russia in the Stockholm International Arbitration Court. The plaintiffs demanded compensation from the Russian government, referring to the fact that as a result of the actions of the state and judicial authorities of the Russian Federation, they suffered financial losses. And, according to the Russian-Spanish agreement on the mutual protection of investments, losses incurred by investors as a result of illegal actions of the state are subject to compensation.

Why Russia lost in the Yukos case
Why Russia lost in the Yukos case

The essence of the lawsuit was that the Russian side deliberately bankrupted YUKOS, which caused financial damage to the company's shareholders. The authorized persons from Russia, appearing in the Stockholm arbitration as a defendant, did not recognize the claim, because, in their opinion, the Yukos management for a long time evaded paying taxes on an especially large scale, and committed other violations of the laws of the Russian Federation. This is precisely what caused the criminal cases against the YUKOS management, as well as its bankruptcy.

However, the Stockholm Arbitration Tribunal sided with the plaintiffs, ruling that Russia should pay them $ 2.7 million in compensation for the losses incurred. The amount of losses was calculated based on the amount of YUKOS's capitalization at the time of its bankruptcy. The decision of the arbitration court emphasized that the tax claims were only a pretext for the seizure of Yukos assets, and the actual purpose of the criminal prosecution of the company's management was the desire not to legally collect taxes, but to expropriate the company. That is, the court concluded that the Russian side deliberately bankrupted YUKOS so that the bulk of its assets would be received by the state-owned companies Rosneft and Gazprom. It should be pointed out that this is already the second decision of the Stockholm Arbitration Court, which was not in favor of Russia based on the claims of Yukos shareholders.

Why is Russia losing such claims in the international arbitration court? One can, of course, refer to a massive propaganda campaign, as a result of which the former head of Yukos, M. Khodorkovsky, appeared in the eyes of Western public opinion as an oppositionist who suffered for his political and democratic convictions. One can point to a very unfriendly attitude of the ruling circles of Sweden towards Russia. Nevertheless, the fact remains: the West believes that the Russian authorities violated property rights in the Yukos affair. And the very concept of "property" is sacred there.

A similar decision was made by the Strasbourg Court of Human Rights, which, although it admitted that the persecution of Yukos and its leadership was not politically motivated, nevertheless also pointed to the violation of property rights in the redistribution of the company's assets.

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