Russia must pay PrivatBank more than $327 million for assets lost in Crimea
Interest on the compensation will accrue until it is paid in full
Russia must pay PrivatBank more than $327 million in compensation for assets lost after the occupation of Crimea. The arbitration tribunal in The Hague issued the ruling.
The bank launched the case in 2015. The legal basis was the 1998 bilateral agreement between Ukraine and Russia on the promotion and mutual protection of investments.
Before the peninsula’s occupation, PrivatBank owned a substantial amount of assets there, including:
- loans;
- real estate;
- cash.
Measures taken by Russia after the occupation deprived the bank of these assets and forced it to cease operations in Crimea.
The compensation awarded covers not only the value of the assets, but also the bank’s costs and expenses, as well as interest accrued since April 18, 2014. Interest will continue to accrue until the compensation is paid in full.
The tribunal also rejected Russia’s objections that PrivatBank’s investments were allegedly illegal. It noted that this did not deprive it of jurisdiction or make the bank’s claims inadmissible.
PrivatBank Board Member for Reorganization and Distressed Assets Solvita Deglava said:
The final arbitral award is a clear and important victory, concluding 11 years of legal efforts by PrivatBank to achieve justice and uphold the principle that unlawful expropriation must have consequences
She added that the bank expects the ruling to be fully enforced and plans to take the necessary steps to recover the compensation awarded.
The United States has imposed new sanctions on Russia’s VTB bank over its activities linked to Iran’s financial system and its assistance in evading US restrictions.
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