28.07.2021

COP allowed Russia not to pay Yukos $ 57 billion

The Constitutional Court published a clarification (.pdf) of its 2012 ruling on the application of international treaties signed but not ratified by Russia. The BBC’s Russian service drew attention to the document, which notes that in fact, the position of the Constitutional Court means permission not to pay $ 57 billion to former Yukos shareholders by the decision of the Hague court.

In 2012, the Constitutional Court allowed the Russian authorities to temporarily apply international agreements that had not been ratified and had not entered into force. This decision applied to the Energy Charter Treaty (ECT), which was not ratified by the Russian side, but was temporarily used since 1994. The shareholders of Yukos and the international arbitration court relied on him, which collected $ 50 billion from Russia in the claims of former shareholders (taking into account the accrued interest, the amount exceeded $ 57 billion).

The CC’s clarification was published at the request of the Russian government, which refers to the principle of separation of powers. The Cabinet believes that the ministers were not entitled to delegate the resolution of disputes of foreign investors to international arbitration, since they were not authorized to change the “competence of Russian courts”.

The Constitutional Court stated that its 2012 decision should not be interpreted as a document that allows for the referral of disputes to an international court. The court stated that the government can sign international treaties on behalf of Russia, but disputes over them should be considered in Russian courts. “The right of the state to exercise judicial jurisdiction on its territory in respect of legal disputes arising on it and the ensuing legislative prerogative to allow the resolution of such disputes in foreign and international jurisdictions are integral parts of state sovereignty,” the document says.

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