UK Court Upholds $5 Billion Award to Naftogaz from Russia over Crimea Asset Seizure

by Roman Cheplyk
Tuesday, December 19, 2023
UK Court Upholds $5 Billion Award to Naftogaz from Russia over Crimea Asset Seizure

The British High Court has acknowledged the decision of The Hague Arbitration, which mandates a $5 billion compensation to Ukrainian energy company Naftogaz for assets seized in Crimea

This recognition by the High Court of Justice of England and Wales, issued on December 5, 2023, includes the arbitral award for damages (plus interest) to the Naftogaz group, along with a partial arbitral award regarding jurisdiction and liability.

Naftogaz Group Chairman Oleksiy Chernyshov commented on the development, noting that since Russia has not voluntarily fulfilled the payment required by the Hague decision, Naftogaz is actively utilizing all possible mechanisms to recover these funds in jurisdictions where Russian assets can be found.

This decision follows the April 12, 2023 ruling by the Arbitration Tribunal at the Permanent Chamber of the Arbitration Court in The Hague, which ordered Russia to pay $5 billion in compensation for the damages and lost property of Naftogaz in Crimea.

Should Russia refuse to voluntarily comply with the court's decision, Naftogaz, under the 1958 New York Convention, has the right to initiate the process of recognition and enforcement of the decision in countries where Russian Federation assets are located.

Furthermore, in April, it was reported that the international law firm Covington & Burling LLP outlined a strategy to enforce the recovery of the $5 billion compensation from Russia for the appropriation of Naftogaz group assets in Crimea.

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