The Supreme Court of the Netherlands on January 18 in the final instance recognized that the bankruptcy of the Yukos oil company by the Russian authorities in 2007 was illegal, and the company’s management was illegally prevented from saving the company.
Thus, the dispute between the former shareholders of Yukos and the Russian company Promneftstroy for the assets of the Dutch subsidiary Yukos Finance has come to an end.
From the judicial decision of the Supreme Court of the Netherlands it follows that the decision of the Moscow Arbitration Court for 2006 on the bankruptcy of NK Yukos OJSC “cannot be recognized by the Dutch legal system” due to its incompatibility with the laws of the kingdom. Accordingly, the court ruled that the results of a public auction in Russia are not recognized, during which the shares of Yukos Finance, a subsidiary of Yukos Finance registered in the Netherlands, were bought by Rosneft, Promneftstroy, for $ 307.
The reasons cited by the Supreme Court of the Netherlands are that the Russian authorities initiated the bankruptcy of Yukos “in violation of fundamental legal principles.” “The bankruptcy trustee (the duties of the bankruptcy trustee of YUKOS were performed by Eduard Rebgun. – Ed. ) Did not have the right to transfer Yukos Finance shares to Promneftroy,” the resolution notes. As a result, the Supreme Court of the Netherlands refused to recognize Promneftstroy as the owner of Yukos Finance shares.
Among the violations, which were also taken into account by the highest judicial authority of the Netherlands, – YUKOS Oil Company in Russia had excessively high demands for VAT and fines, which the company had to pay even in unrealistically short terms. The court concluded that Yukos was deprived of the opportunity to defend properly in a Russian court, and the authorities ignored all independent attempts by the company to settle tax claims.
In May 2017, a similar decision was made by the Court of Appeal of Amsterdam – then he refused to cancel the decision of the Amsterdam District Court of 2007. After repeated defeat, Promneftstroy LLC decided to try their luck for the third time. But the Supreme Court of the Netherlands 20 months later, the former Rosneft structure upset, confirming that Promneftstroy had illegally become the owner of Yukos Finance shares in 2007, and the bankruptcy of YUKOS NK was “not justified,” because “the Russian authorities deliberately provoked it bankruptcy”.
And this is already the third victory of YUKOS in the highest court of the Netherlands in a bankruptcy case. By the rulings of June 25, 2010 and January 7, 2011, the Supreme Court of the Kingdom has already confirmed the decisions of the lower Dutch courts on non-recognizing the bankruptcy of Yukos and collecting money from Rosneft and its structures in its favor.
Previously, the Dutch trust Stichting Administratiekantoor Financial Performance Holdings distributed compensation to former shareholders of Yukos. According to the Yukos claims management website , the size of the Compensation Distribution Fund was at least $ 337 million.
Reactions and comments of the Russian authorities, as well as representatives of Promneftstroy, have not yet followed the decision of the court. In turn, in Yukos, the third decision of the Supreme Court of the Netherlands “Novaya” was called extremely significant for all shareholders of the company, to whom compensation will now be paid.
Let me remind you that the oil company Yukos, which existed from 1993 to 2007, was one of the largest in Russia in terms of oil sales. In 2003, simultaneously with the appearance of criminal cases against managers and managers of NK Yukos, the Ministry of the Russian Federation for Taxes and Fees (now the FTS) initiated an investigation into tax evasion of the company in 2000–2003.
The company’s management, together with the shareholders, considered the possibility of declaring NK Yukos bankrupt in order to avoid dismemberment of the company.
After the imposition of fines, Yukos shares fell sharply in price. On June 17, 2004, Vladimir Putin declared that the state does not intend to bankrupt Yukos. As a result, the shares went up by almost a third in one day. Two weeks later, the Federal Bailiffs’ Service decided to forcibly sell the company’s main production asset, Yuganskneftegaz, to recover its debts to the budget.
And Yuganskneftegaz was auctioned off. The buyer was a one-day firm Baikalfinansgrupp LLC with a registered capital of 10,000 rubles, registered two weeks before the auction on dummies in Tver
Meanwhile, President Vladimir Putin was aware of the existence of this company, having publicly stated after the auction that state-owned companies are not in favor of “Baikalfinansgrupp”, and its shareholders “are exclusively individuals who have been engaged in energy business for many years.” A few days later, “Baikalfinansgrupp” was purchased by the state “Rosneft”.
By March 2006, when the leaders of Yukos were convicted by the first court sentence, and top and middle managers were under investigation or wanted, the Moscow Arbitration Court decided to bankrupt the company and appoint an external manager in it, which became Edward Rebgun. Yukos has entered a one-year competitive procedure. On November 21, 2007, on the basis of a decision of the Moscow Arbitration Court, the Yukos Oil Company was liquidated. During 2007, the company’s property was sold at auction – its main assets went to Rosneft.
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DISCLAIMER: The English version is a translation from the Russian original NRC article and is for information purposes only. In case of a discrepancy, the Russian original will prevail.