A court in The Hague finally ordered Russia to pay $50 billion to ex-YUKOS shareholders

The Supreme Court of the Netherlands in The Hague made a final decision on the claim of ex-YUKOS shareholders against Russia, rejecting the cassation appeal of the Russian side and approving the decision of the Amsterdam Court of Appeal to pay $50 billion to ex-shareholders.

The companies Hulley Enterprises, Yukos Universal and Veteran Petroleum, which, according to the Russian side, represented the interests of Leonid Nevzlin, Mikhail Brudno and Vladimir Dubov, challenged the legality of the state expropriation of their shares in the oil company (in total about 70%).

Fundamentally, the court in The Hague ruled that the Russian state violated the rights of Yukos shareholders back in 2014. After the arrest of the company's founder, Mikhail Khodorkovsky (recognized as a foreign agent in Russia), it was forced into bankruptcy and sold. Moreover, the court ruled that the purpose of the attack on YUKOS was bankruptcy with the transfer of assets to Rosneft and Gazprom through shell companies, and the neutralization of a political opponent.

Russia has since challenged the decision, sometimes achievingprocedural successes . However, in essence, the case was lost on appeal in 2020, when the issue of jurisdiction of international arbitration was finally resolved. The court accepted the arguments of Yukos shareholders, turning the legal details of the agreement on the annexation of Crimea against Russia. We talked about this incident in more detail here .

Why is this important

The decision "is not just a historic victory for shareholders, but affirms a fundamental principle of responsibility that even rogue states like Russia cannot shirk," the AP quoted Tim Osborne, chief executive of shareholder advocacy firm GML, as saying. They have already made foreclosures on Russian assets. Taking into account accrued interest, the amount of payments significantly exceeds $50 billion.

Khodorkovsky thanked everyone who spent “20 years of their life” on the case and called the decision “the most powerful blow to the Putin regime in the legal field.” According to him, the court confirmed that “the YUKOS company conducted legal activities. The management and shareholders of YUKOS are not a criminal group.”