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4 Mar, 2010 10:19

Yukos shareholders get a hearing in Strasbourg

The European Court of Human Rights has opened a case to hear complaints from former Yukos shareholders who claim they lost billions of dollars following the company’s breakup.

A team of former Yukos shareholders, top managers and creditors are accusing Russian authorities of breaching a number of articles of the European Convention on Human Rights, which include the right to fair trials, effective legal protection and protection against discrimination.

The sum of the compensation, which has been reported at $98 billion dollars, is derived from alleged damages accrued by the forced sale of Yukos assets to cover its enormous tax debts and fines.

After the Russian tax ministry presented Yukos with a bill for back taxes in 2003, which was at the time the largest such bill in Russian history, Yukos owners Mikhail Khodorkovsky and Platon Lebedev were arrested and put on trial for tax evasion and gross embezzlement in the course of the 1990s privatization frenzy.

In 2005, they were sentenced to 9 years in prison, which has since been reduced to 8 years.

In 2006, Yukos was declared bankrupt and sold to cover its outstanding debts to the government and other creditors. One year later, the company was removed from the state registrar of commercial entities.

Several top managers and shareholders of the oil company made their first attempt to take the Russian government to court in 2004, but their plea was rejected; it is only this year that the Strasbourg court of Human Rights accepted the suit.