British court halts enforcement of Yukos legal settlement, saying Moscow has 'high chance' of successful appeal in $60bn battle

The High Court in London has rejected a motion from former shareholders in the collapsed oil and gas giant Yukos, siding with Moscow's lawyers and refusing to enforce the terms of a 2014 verdict against the Russian government.

On Wednesday, Russia's Justice Minister Konstantin Chuichenko told a departmental meeting that "just now, literally half an hour ago, we were notified by England's High Court of their decision to refuse requests by the former shareholders in the Yukos oil company to resume proceedings in the UK to enforce an international arbitration award adopted in 2014."

The case was brought against the government in international courts seven years ago, with the oligarchs behind the bankrupted firm accusing the state of 'expropriating' the business' assets. Russia has consistently rejected these claims and is appealing the decision.

According to Chuichenko, the British justices evaluated the claims as unenforceable because a simultaneous hearing of the case is underway in the Netherlands, where Russia's lawyers are seeking to overturn the $60 billion settlement originally handed to the former shareholders.

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"The High Court of England has recognized that the complaint has a high chance of success and is part of Russia's bona fide and legitimate actions to protect its interests," Chuichenko stressed.

Once among Europe's largest businesses, Yukos crashed after authorities handed its management a multibillion-dollar tax bill, and the state subsequently took control of its assets. Its former owners acquired oilfields and equipment as part of a mass sell-off after the fall of the Soviet Union. They bought the empire for a fraction of its worth at an auction that one economist, Andrey Illarionov, dubbed "the swindle of the century."

Chuichenko's deputy, Mikhail Galperin, said earlier this year that the UN Convention against Corruption "very clearly states that structures that receive illegally acquired assets… cannot be considered as bona fide third parties," accusing the former Yukos shareholders of illicitly bolstering their wealth.

"This means they cannot say: 'Oh, I am just a third party, I am protected. I don't care how these illegal assets were acquired.' They should care," Galperin said.

According to the Deputy Justice Minister, these principles are "essential for any civilized state that you cannot benefit from such kinds of things. You cannot have legal protection for your illegal behavior."

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Galperin had previously claimed that the oligarchs who once owned the enterprise had "acquired Yukos for peanuts by means of fraud and bribery." Then, he said, "they extracted billions of dollars… by means of offshore schemes, as well as tax and corporate manipulations." International rulings in their favor, he added, did not consider Russian laws banning many of these actions.

Russia's top court has previously ruled that the country can refuse to pay up if the initial financial reward is upheld, arguing that national laws should never be superseded by international treaties.

However, Yukos' former shareholders have launched a campaign to have Western governments confiscate Russian state property as collateral. Last year, a parallel suit brought by the complainants was temporarily thrown out by an American court. A judge in Washington accepted the Russian petition to suspend proceedings while the case was being heard in the Netherlands.

The claimants had requested US authorities demand a $7 billion security bond from Russia in case Moscow decided not to pay up.

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