22 Aug 2019 19:07

Moscow to challenge Paris arbitration ruling in Oschadbank lawsuit

MOSCOW. Aug 22 (Interfax) - Russia has appealed against the ruling by the International Court of Arbitration in Paris in the lawsuit filed by the Ukrainian Oschadbank, noting that the bank's Crimean branch did not fall under an investment protection agreement, the Justice Ministry said.

"The Oschadbank's Crimean branch, which the bank claims was appropriated, had existed since the Soviet times and was part of Oschadbank even before 1992. Oschadbank made no mention of these facts during the arbitration proceedings," the ministry said in a statement obtained by Interfax on Wednesday.

This evidence "enabled Russia, in accordance with French law, to apply, on August 19, for the arbitration ruling to be reviewed by the same tribunal which delivered the initial ruling."

Since 2018, Russia has questioned the legality of arbitration rulings in the lawsuits brought by the Ukrainian oligarchs Ihor Kolomoiskyi and Rinat Akhmetov and their companies, and in the lawsuits filed by Ukrainian state companies over a bilateral agreement with Russia on the promotion and mutual investment protection, and related assets in Crimea, the ministry recalled.

"This work led to the discovery of internal documents of the co-plaintiff Oschadbank, attesting that its so-called investment had never been protected by said agreement.

"The agreement does not cover Soviet-era investments but only those made after January 1, 1992. In this regard, Oschabank is a former Ukrainian branch of the Soviet savings bank."

It was reported that after the international arbitration ruling last November, Oschadbank announced the award of a $1.3 billion in compensation and $97,000 in accrued interest.

The hearing was held in accordance with the Arbitration Rules of the United Nations Commission on International Trade Law of 1976 and an agreement between the Cabinet of Ministers of Ukraine and the government of the Russian Federation on the promotion and mutual protection of investments.

Moscow said the arbitration had no jurisdiction over the case, and refused to recognize its ruling. The Justice Ministry vowed to take all necessary measures to defend the Russian interests in the case.