icon bookmark-bicon bookmarkicon cameraicon checkicon chevron downicon chevron lefticon chevron righticon chevron upicon closeicon v-compressicon downloadicon editicon v-expandicon fbicon fileicon filtericon flag ruicon full chevron downicon full chevron lefticon full chevron righticon full chevron upicon gpicon insicon mailicon moveicon-musicicon mutedicon nomutedicon okicon v-pauseicon v-playicon searchicon shareicon sign inicon sign upicon stepbackicon stepforicon swipe downicon tagicon tagsicon tgicon trashicon twicon vkicon yticon wticon fm
18 Jun, 2015 04:21

Moscow summons Belgian envoy over seizure of state assets, threatens retaliation

Moscow has summoned the Belgian ambassador to lodge a protest over the freeze of its state assets. It said that Moscow may consider retaliatory measures against Belgium if the assets are seized, including against Belgium diplomatic property in Russia.

This comes after Belgian bailiffs notified Belgian, Russian and other international companies of the seizure of assets belonging to Russia at the behest of the Isle of Man-based Yukos Universal Limited, a subsidiary of the Russian energy giant, which was dismantled in 2007. They have given the target companies a fortnight to comply.

The frozen Russian assets include accounts of the Russian Embassy and Russia’s Permanent Mission to the UN. Even without any further analysis, this means a blatant violation of international law. We don’t yet know what the official position of our Belgian partners is, but at first sight, this seems to be an excessive act,” Russia's Justice Minister Aleksandr Konovalov said.

READ MORE: Russian companies' accounts in VTB French subsidiary frozen - CEO Kostin

Russia will appeal the court’s arrest of Russian property, Russian presidential aide Andrey Belousov said. According to the official, “the situation with the arrest of the property is politicized, [and] Moscow hopes to avoid a new escalation in relations.”

On Thursday, Russia’s Foreign Ministry said it views Belgium’s actions as “an unfriendly act” and “a blatant violation” of the norms of international law, adding that it could consider retaliatory measures against Belgium if the assets are seized.

“The Russian side will have to consider the adoption of adequate retaliatory measures against the property of Belgium located in the Russian Federation, including the property of the Embassy of Belgium in Moscow, as well as its legal entities,” the Russian Foreign Ministry said in a statement.

Belgian Ambassador to Russia Alex Van Meuwen said he would immediately inform Brussels about Russia’s statement.

READ MORE: Amsterdam court says Yukos International has legitimate compensation claim against Rosneft

A letter accompanying the bailiffs notice , reportedly drafted by the law firm Marc Sacré, Stefan Sacré & Piet De Smet, accused Moscow of a “systematic failure to voluntarily follow” international legal judgments.

The addressees included not just local offices of Russian companies, but international banks, a local branch of the Russian Orthodox Church, and even Eurocontrol, the European air traffic agency headquartered in Brussels. Only diplomatic assets, such as embassies, were exempt.

The situation was not unexpected, and Russia is considering a number of measures to deal with possible asset seizures both in Belgium and in other countries, said Andrey Belousov.

Mikhail Khodorkovsky (RIA Novosti / Ramil Sitdikov)

Yukos Universal Limited was awarded $1.8 billion in damages by the Permanent Court of Arbitration in The Hague in July 2014, as part of a total settlement for approximately $50 billion, owed to its former shareholders and management. The court concluded that the corporation, once headed by Mikhail Khodorkovsky, who spent more than a decade in prison for embezzlement and tax evasion from 2003 to 2013, “was the object of a series of politically motivated attacks.”

READ MORE: Russia finds $21.7bn mistake in Yukos case

Russia has not accepted the ruling, saying it disregards widespread tax fraud committed by Yukos, and constitutes a form of indirect retribution for Russia’s standoff with the West over Ukraine. Earlier this month, the Russian ministry of justice said it would take “preventative measures” to avoid property confiscation, and challenge each decision in national courts.

READ MORE: Russia appeals $50bn Yukos verdict

A separate ruling by the European Court of Human Rights (ECHR) last summer awarded Yukos shareholders €1.9 billion in compensation. Russia’s Dozhd channel quoted ECHR representatives as saying that the reported seizures are not related to its legal decision as several media reports have previously suggested.

Neither Belgium, nor Russia have yet released official statements about potential asset seizures.

Russia spent much of the 1990s embroiled in legal squabbles with several foreign creditors, who attempted to seize its property abroad, but each time the dispute was settled without asset confiscation.

READ MORE: Justice Ministry seeks probe into Khodorkovsky’s Open Russia movement - report