YUKOS once epitomised the transformation of Russian business from its chaotic, robber-baron state in the 1990s to something approaching international norms. But the downfall in 2003 of the country’s largest and best-run oil firm exemplified something else: the way in which the Kremlin was seizing control of the commanding heights of the economy. A series of dubious lawsuits and auctions bankrupted and dismembered Yukos. Its boss, Mikhail Khodorkovsky, went to jail and most other managers fled abroad.
That left the company’s shareholders hugely out of pocket—and furious. But after a decade of litigation to establish jurisdiction and applicability of international law in the case, they are beginning to gain redress. Their biggest victory came with a $50 billion judgment against Russia last year by the Permanent Court of Arbitration in The Hague. Russia had signed an international agreement called the Energy Charter, which protects cross-border investment. Though Russia never ratified its membership and has now withdrawn from the treaty, the judges (including one nominated by Russia) ruled unanimously that it had breached the charter’s...
from The Economist: Business http://ift.tt/1Nk7rJS
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