January 18, 2019 / 12:39 PM / 3 months ago

Takeover of Dutch parts of Yukos Oil was illegal: Supreme Court

FILE PHOTO: A drop of diesel is seen at the tip of a nozzle after a fuel station customer fills her car's tank in Sint Pieters Leeuw December 5, 2014. REUTERS/Yves Herman/File Photo

AMSTERDAM (Reuters) - The 2007 takeover of the Dutch parts of Yukos Oil by Russian state oil company Rosneft’s former subsidiary Promneftstroy was illegal, the Dutch Supreme Court ruled on Friday, upholding an earlier lower appeals court ruling.

Yukos Oil went bankrupt in 2006 after its former chief Mikhail Khodorkovsky, fell out with Russian leader Vladimir Putin and the Russian government began demanding billions in back taxes.

Most of Yukos’ assets were absorbed by the Kremlin’s flagship oil producer Rosneft, and its former owners have for years been trying to recover their possessions.

The Dutch case involved the transfer in 2007 of $307 million worth of shares in Yukos Finance BV, a Dutch holding company, to Promneftstroy, a state-controlled investment company .

“It has been established definitively that the liquidator was not authorized to transfer shares in Yukos Finance to the Russian company Promneftstroy and that Promneftstroy therefore did not become the owner of shares in Yukos Finance,” the ruling said.

Khodorkovsky, Russia’s fallen oligarch, has repeatedly said he was the victim of a political campaign which led to the demise of Yukos, Russia’s largest private oil firm, on tax evasion charges.

Steven Theede, former Yukos CEO, said it was satisfying to have an independent court “recognize the blatant theft of Yukos Oil by the Russian Federation.”

“We are very pleased that we were able to protect the international assets of Yukos Oil for the benefit of the shareholders of Yukos Oil, the ultimate victims of the Kremlin’s expropriation,” he said.

Rosneft went public on the London Stock Exchange in 2006 in an $11 billion initial public offering. Rosneft was not immediately available to comment on the ruling.

Reporting by Bart Meijer and Toby Sterling; Additional reporting by Olga Yagova in MOSCOW; Writing by Anthony Deutsch; Editing by Susan Fenton and Louise Heavens

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