Russia loses appeal but unlikely to pay in $50bn Yukos bankruptcy case

This case has been a prolonged one, lasting nearly two decades, but, as Bloomberg highlights, it is improbable that the recent verdict will prompt an immediate compensation disbursement to former Yukos shareholders. Historically, Yukos was Russia's biggest oil firm and had shareholders internationally.

The Hague Court had already ordered Russia in 2014 to pay the shareholders $50 billion in compensation. Moscow had attempted to challenge the arbitration findings and requested their dismissal.

Russia has previously asserted that it has no obligation to pay the largest sum in arbitration history - Bloomberg reports.

Arbitration procedures in 2005 were initiated by the three principal shareholders of Yukos - Veteran Petroleum Ltd., Yukos Universal Ltd., and Hulley Enterprises Ltd.

"The owners of the now-defunct Yukos Oil claimed that Russia was motivated by political considerations when imposing numerous tax demands that ultimately forced the company into bankruptcy. State-owned Rosneft PJSC then took over most of Yukos' assets," Bloomberg adds.

Mikhail Khodorkovsky, once regarded as the wealthiest Russian over 20 years ago, was a former co-owner of Yukos. The seizure of Yukos occurred during Vladimir Putin's initial presidency.

The tribunal in The Hague found that the oil conglomerate, managed by Mikhail Khodorkovsky, was dismantled for political reasons. It was similar to Khodorkovsky's own experience of winding up in a reformatory, as he perturbed the political elite associated with the Kremlin. In 2013, Putin pardoned Khodorkovsky, who was then released. Subsequently, the entrepreneur departed from Russia.