A Dutch court has rejected a final argument in a legal battle over former Russian oil giant Yukos

An Amsterdam court has rejected Russia’s final argument in a years-long legal battle over a $50 billion arbitration award

Netherlands Yukos Russia (Copyright 2024 The Associated Press. All rights reserved)

An Amsterdam court on Tuesday rejected Russia's final argument in a years-long legal battle over a $50 billion arbitration award that is centered on claims by former shareholders that the Kremlin deliberately bankrupted Russian oil giant Yukos to silence its CEO, a fierce critic of President Vladimir Putin.

A panel of international arbitrators ruled in 2014 that Moscow seized control of Yukos in 2003 by deliberately crippling the company with huge tax claims. It ordered Russia to pay the former shareholders $50 billion.

CEO Mikhail Khodorkovsky was arrested at gunpoint in 2003 and spent more than a decade in prison as Yukos’ main assets were sold to a state-owned company. Yukos ultimately went bankrupt.

Tuesday's ruling by the Amsterdam Court of Appeal rejected a final ground of appeal filed by Russia alleging fraud by former shareholders. The court said in a written statement that Russia made the claim too late in the proceedings. It added that even if Russia had raised the alleged fraud at an earlier phase of the drawn-out case it would not have altered the outcome.

“More than 20 years after the brazen expropriation of Yukos, and more than 10 years after being ordered to pay the largest award of damages in the history of arbitration, more than $50 billion, the Amsterdam Court has rejected Russia’s last remaining legal excuse: time to pay up,” said Tim Osborne, director of GML, a company that unites the former majority shareholders.

“We will continue to focus our attention on the ongoing enforcement against Russian state assets in the Netherlands, England, and the United States, and we do not rule out we will start enforcement proceedings in other countries as well,” Osborne added in a written statement.

The original case was handled under the Permanent Court of Arbitration, headquartered in The Hague, Netherlands. As a result, Russia appealed the arbitration decision in the Netherlands, kicking off years of litigation.

In the 2014 arbitration, the panel ruled that Russia launched “a full assault on Yukos and its beneficial owners in order to bankrupt Yukos and appropriate its assets while, at the same time, removing Mr. Khodorkovsky from the political arena.”