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Home News Ex-Yukos shareholders appeal quashing of $50 bn award

Ex-Yukos shareholders appeal quashing of $50 bn award

Published on 18/07/2016

Former shareholders of the now-dismantled Russian oil giant Yukos on Monday appealed a Dutch court's decision to overturn a ruling that ordered Moscow to pay them a record $50 billion in damages.

Main ex-shareholder GML and Veteran Petroleum Limited “filed an appeal against the judgement… which challenged the July 2014 award against the Russian Federation,” they said in a statement.

Yukos was once Russia’s biggest oil company but was broken up after its former owner, Kremlin critic and ex-tycoon Mikhail Khodorkovsky, was arrested in 2003.

His arrest came shortly after Russian President Vladimir Putin, then the prime minister, warned the nation’s growing class of oligarchs against meddling in politics.

Yukos was sold off in opaque auctions to state companies led by Rosneft between 2004 and 2006.

State-owned Rosneft was then small, but has become a leading global player among the world’s biggest listed oil companies by production volume.

In a major coup for the claimants, the international Permanent Court of Arbitration (PCA) ruled in 2014 that Russia had forced Yukos into bankruptcy with excessive tax claims and sold off its assets to state-owned companies.

It ordered Moscow to pay in “excess of $50 billion” to the former shareholders — a record award for the arbitration tribunal.

However, in April the district court in The Hague ruled that the PCA, based in the Dutch city, was “not competent” to rule in the matter.

“We remain determined to hold the Russian Federation responsible for the expropriation of Yukos,” GML director Tim Osborne said in the statement.