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18 Jan, 2019 11:51

Swiss court overturns arrest of Russia’s Gazprom assets which Ukraine claims were seized

Swiss court overturns arrest of Russia’s Gazprom assets which Ukraine claims were seized

Switzerland's high court has overruled an injunction blocking payments from the operators of the Nord Stream gas pipeline at the request of Ukrainian state gas firm Naftogaz, according to Russian energy giant Gazprom.

The Stockholm arbitration court had previously ruled that all payments from Gazprom’s subsidiaries would be transferred to Swiss bailiffs.

“On January 16, a court of the canton of Zug (Switzerland) decided to completely cancel its decision of May 29, 2018, on imposing interim measures in Switzerland against shares of Gazprom in Nord Stream AG and Nord Stream 2 AG and Gazprom's rights of claim against these companies,” Gazprom said.

The latest court decision is a part of an ongoing litigation between Gazprom and Naftogaz that started back in 2014, when the two energy producers lodged mutual claims over supply and transit contracts.

The news came shortly after the CEO of Ukraine’s Naftogaz Andrey Kobolev told journalists that Gazprom-owned assets had been arrested in three European countries.

Last year, the Stockholm court ruled that the Russian company pay for a shortfall in the delivery of gas to Ukraine, awarding Naftogaz $2.6 billion in compensation. Gazprom appealed the verdict, and notified the Ukrainian firm of terminating the gas-delivery contracts. Naftogaz in turn took legal steps to seize Gazprom’s assets in Europe.

The contract for the supply of natural gas from Russia to Ukraine, signed in early 2009, was set to expire by the end of 2019. Under the terms of the agreement, Ukraine was to buy 40 billion cubic meters of gas a year with the annual volume increasing to 52 billion cubic meters from 2010.

However, Ukraine's Naftogaz opted to stop buying the contracted volume in November 2015, replacing it with reverse gas supplies from European countries. The step was seen by Russia's Gazprom as a breach of contract.

Commenting on the latest ruling by the Swiss high court Naftogaz Commercial Director Yuriy Vitrenko said the court found no Gazprom’s assets to arrest in Switzerland. According to the top-manager, Nord Stream AG and Nord Stream 2 AG had notified the court that the previous ruling on the seizure was impossible to implement.

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