“A court in France has allowed the recovery of $5 billion from Russia for NaftogazThe French court has allowed the forced recovery of 5 billion dollars from Russia in favor of Naftogaz. The company has already encumbered Russian assets in France for more than 120 million euros.”, — write: unn.ua
The Paris court recognized and authorized the forced execution (exequatur) of the Hague Arbitration decision on compensation for losses caused by the illegal expropriation of Naftogaz Group assets in Crimea in the amount of $5 billion
“This result is part of our global campaign to enforce the arbitration decision. This is an extremely important legal victory for NJSC “Naftogaz of Ukraine” and five other companies of the Group. It allows Naftogaz to start the recovery procedure in France,” explained Roman Chumak, head of the Naftogaz Group.
As indicated, within the framework of this process, Naftogaz has already registered encumbrances on a number of assets belonging to the Russian state and located in France, with a total value of more than 120 million euros. This, as noted, is the first step towards enforcing the arbitration decision.
It is reported that the process of obtaining a court decision on recognition and permission to enforce the final arbitration decision was carried out by the Le 16 Law team entirely on a pro bono basis.
“Naftogaz continues to do everything possible to bring the arbitration decision closer to implementation. We already have some success in several other jurisdictions, including the United Kingdom and Finland. We are determined to recover the full amount of compensation and protect the rights of Ukrainian state-owned enterprises in the international arena,” emphasized the head of the Naftogaz Group.
ContextIn October 2016, Naftogaz initiated arbitration proceedings against Russia, demanding compensation for Moscow’s illegal seizure of the Group’s property – in violation of the bilateral agreement on the protection of investments between Ukraine and Russia. Naftogaz was a leading player in the natural gas market in Crimea, carrying out activities in the exploration, production, transportation, storage, processing and distribution of gas. The list of assets included special permits for the use of mineral resources, equipment and infrastructure, rights to operate pipelines and gas storage facilities, shares in the ownership of gas pipelines and more than 675 million cubic meters of gas in underground storage facilities.
After a multi-year arbitration review, on April 12, 2023, the tribunal consisting of Judge Ian Binnie (C.C., K.C.), Dr. Charles Poncet and Dr. Maya Stanivukovich, formed under the auspices of the Permanent Court of Arbitration (PCA) in The Hague, ordered Russia to pay Naftogaz more than 5 billion US dollars for violation of the terms of the agreement. This amount of payment, for which there is already a Final Arbitration Decision, remains the largest among all claims of investors filed by Ukrainian companies regarding Russia’s illegal actions in Crimea.
The final arbitration decision on compensation for damages was made after an interim Partial Decision, in which the tribunal recognized its jurisdiction to consider Naftogaz’s claims and established that Russia is responsible for the expropriation of the company’s property. Initially, Russia refused to participate in the case, but later changed its position and actively joined the stage of considering the issue of compensation. The hearing on damages took place in the Peace Palace in The Hague and lasted at the time of Russia’s full-scale invasion of Ukraine at the end of February 2022.
Recently, the Supreme Court of the Kingdom of the Netherlands rejected the cassation appeal of the Russian Federation regarding the cancellation of the Partial Decision of the tribunal on jurisdiction and the merits of the case.
Despite the arbitration decision and the ruling of the Supreme Court of the Netherlands, Russia refuses to pay Naftogaz the awarded amount. Therefore, Naftogaz initiated an international recovery campaign. The main goal is to ensure the implementation of the arbitration decision in jurisdictions where Russia has assets.
14.04.23, 06:28 • 458874 views