Russia PM urges response to unlawful arrests of Russian property abroad

Russia should introduce reciprocal measures in response to unlawful arrests of Russian property by foreign states, Prime Minister Dmitry Medvedev said on Thursday at a cabinet meeting.

"Our state must have a right to impose response restrictions, including the refusal to grant the immunity from our court decisions to such states, particularly decisions related to recovery of the property of such states by court decision in our country," the prime minister said.

The new draft law on the jurisdictional immunity of a foreign state and its property provides for introduction of the relevant reciprocal measures, Medvedev said.
"This draft law for the first time provides a court of the Russian Federation with an opportunity of limiting the immunity of a foreign state on the basis of the reciprocity principle, which is especially actual against the background of largely unlawful acts undertaken against our state and other property in certain other nations," the prime minister added.

Such acts of foreign states are often dictated by political, rather than legal, motives, Medvedev said.

Earlier on Thursday, Federation Council’s Committee on Constitutional Legislation and Civil Society Development deputy chairman Konstantin Dobrynin proposed to set up a state agency or appoint a special representative for managing risks of possible lawsuits filed by international creditors against Russia.

Arrest of Russia’s assets with a threat of confiscating them in the framework of the Yukos case may become a precedent, the lawmaker stressed. "After this precedent, many foreign corporations and even state structures of other countries may try to take the same path as former Yukos beneficiaries," he noted.

Last year the European Court of Human Rights (ECHR) ruled that former Yukos shareholders are entitled to €1.866 billion in compensation following their complaint against Russia issued in 2011. The ECHR concluded the 2000 inquiry into Yukos’ taxes by Russia’s government violated the European Convention on Human Rights. Russia hence had to present to the European Council a plan on compensation payments to former Yukos shareholders before June 15, however it was not done.

In December 2014 Russia’s Justice Minister Alexander Konovalov said "the decisions of the ECHR may not be enforced, it is up to the good will of the European Council member-states."

On July 10, Deputy Justice Minister Georgy Matyushin said further actions on the part of the Russian government on the implementation of the ECHR’s decision regarding the former Yukos shareholders will be carried out in view of Russia’s Constitution legal stance.