: :inin Kyiv (EET)

Ukraine will defend its position in English High Court against Russia’s suit on Yanukovych’s $3 bln debt

On Tuesday, January 17, 2017, in the High Court of England starts the first hearing in consideration of the claim of Russia against Ukraine on $ 3 billion debt, according to the official the website of the court.

Kyiv authorities consider a $3 billion loan from Russia negotiated between then-President of Ukraine Viktor Yanukovych and Russian President Vladimir Putin in 2013 as a `political bribe`, which the Kremlin paid to encourage Ukraine to give up its European Union integration plans.

See also: Ukraine views $3 bln loan as Putin`s bribe to Yanukovych to give up EU integration plans

Russia lodged with the London High Court a suit against Ukraine after it defaulted on paying the principal amount and interest on a $3 billion loan. The fact that the bonds were purchased via the Irish Stock Exchange makes the disbursement a private creditor debt.

However, the Russian side insisted that this was an interstate debt, as the buyer was the state-owned National Wealth Fund. Ukraine wanted the $3 billion eurobond to be restructured under sovereign and sovereign-guaranteed bonds, but Russia reiterated it did not consider the debt to be commercial. Kyiv refused to repay the bond, saying Russia should have participated in the restructuring.
Besides the Russian Federation insists on paying an additional interest on the bonds.

Mitu Gulati, a law professor at Duke University in the United States says that the case, which will be heard at the High Court on Jan. 17, is unusual in many ways:

“The most important big issue here is: Does Ukraine actually owe money to a country that basically ran it as a vassal state and invaded it and took its territory? And that is the kind of question that courts usually don’t ever decide,” said Gulati

See also: IMF to provide Ukraine with financing despite $3 bln eurobond debt to Russia


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