Dutch Supreme Court rules that Russia unlawfully bankrupted Yukos

On Friday 18 January 2019, the Dutch Supreme Court ruled that Russia unlawfully bankrupted Yukos Oil Company. The judgment upholds the ruling of the Appeals Court, which found the politically-motivated bankruptcy so egregious that it violated Dutch public policy.

“It’s extremely satisfying to have an independent and impartial court of law make such a significant ruling and recognise the blatant theft of Yukos Oil by the Russian Federation,” said Steven Theede, former Yukos CEO and board member of the Yukos Foundations, which oversaw the litigation. “It is a good day for the rule of law.”

The Appeals Court found that Yukos’ bankruptcy in 2006, which led to the sale of the shares of Yukos Finance, cannot be recognised in the Netherlands. The Russian authorities drove Yukos into bankruptcy as part of a politically-motivated assault on then-Yukos CEO Mikhail Khodorkovsky. Yukos’s assets in Russia were primarily transferred to Rosneft.

In another Yukos case pending before the Dutch courts, the Amsterdam District Court, on December 5 2018, rendered a highly critical judgment on the Russian court system. The judgment underlined the lack of impartiality and independence of Russian courts, which, in cases against Yukos, served the interests of the Russian government. The Amsterdam Court specifically referred to the practice whereby Russian judges are told how to render judgments in favor of the government, even receiving fully drafted judgments to hand down.