OSCHADBANK WON OVER RUSSIA IN INTERNATIONAL ARBITRATION 26.11.2018

News

International Arbitration delivered an unprecedented award on recovery of USD 1.3 billion from the Russian Federation in favour Oschadbank

On 26 November 2018, the Arbitration in Paris has satisfied the claim of "State Savings Bank of Ukraine" (Oschadbank) for the compensation of losses caused by the annexation of Crimea by the Russian Federation. The hearing was held in accordance with the Arbitration Rules of the United Nations Commission on International Trade Law of 1976, as well as in accordance with the Agreement between the Cabinet of Ministers of Ukraine and the Government of the Russian Federation on the Encouragement and Mutual Protection of Investments.

The compensation will amount to USD 1.3 billion, plus interest, which will be accrued from the day of delivery of the award until payment in full. In accordance with Article 32 of the Arbitration Rules of the United Nations Commission on International Trade Law of 1976, the arbitral award shall be final and binding on the parties. The parties are obliged to execute the arbitral award without delay. The decision of the arbitration in favour of Oschadbank is the result of more than 4-year efforts of Oschadbank team and its legal advisors – Quinn Emanuel Urquhart & Sullivan, LLP and Ukrainian legal adviser Asters Consult.

"Today, we received an official announcement of victory! It is hard to imagine the message that we need now more than this. Considering how our relationship with the aggressor is developing, this victory has extraordinary importance not only for us but also for the entire Ukraine! Since the first day of Crimea annexation, we worked on documenting crimes, committed against the bank by occupying authorities, preparing to meet them in international judicial institutions, – Andrii Pyshnyi, Chairman of the Board of Oschadbank said. – The amount of compensation awarded indicates that the arbitration accepted all legal arguments and economic calculations provided by Oschadbank team. Oschadbank will strongly demand payment of the awarded compensation".

Alex Gerbi, a partner in Quinn Emanuel Urquhart & Sullivan, LLP said: "This award satisfied all the claims of Oschadbank to the Russian Federation concerning the expropriation of the banking business and assets in Crimea as a result of the illegal occupation and annexation of the territory in violation of international law".

The total scope of the application of Oschadbank against the Russian Federation with all appendices made more than 30,000 sheets. The hearing of the case took place in March 2017. Oschadbank is the first company with 100% of its shares owned by the state, and the first banking institution, which won a case against the Russian Federation on compensation of losses resulting from the annexation of Crimea.

"Our example shows that attempts to legally make the aggressor state responsible for the losses, which have arisen due to the occupation of the territory of Ukraine, have real prospects of success", – Andrii Pyshnyi said. – We urge other both public and private Ukrainian companies to apply to international arbitration to restore justice and to hold the occupier liable at least for economic losses of Ukraine caused by the armed attack on our country. I appreciate my extraordinary team of lawyers, our external advisors, everybody who believed in our victory and was there for us! I had no doubt that victory would be ours". In accordane with Andrii Pyshnyi’s words, the respective specialists of Oschadbank are ready to provide advices and information to those organizations, which follow the path of Oschadbank and will apply to international judicial institutions and tribunals against the Russian Federation for compensation of losses resulting from the aggression in Crimea.

After receiving the arbitral award in a prescribed manner, Oschadbank will begin to take all possible actions for implementation of the award and recovery of funds from the Russian Federation. The Bank will actively strive for execution of the arbitration award concerning the assets of Russia in the respective jurisdictions throughout the world.

Prepared on the basis of materials of the Press Service of Oschadbank