Introduction

On 18 July 2014 three final awards were rendered in arbitration proceedings which lasted almost a decade and were brought by former majority shareholders of OAO Yukos Oil Company. Following their release, the Russian Federation, the award debtor, has made it publicly known that it would resist compliance with the awards. In light of this, the paper argues that winning the battle of obtaining arbitral awards does not mean that the Yukos shareholders have won the war as a result of the existing challenges in the process of enforcement. It thus focuses on the available enforcement tools available to the Yukos shareholders if enforcement is sought in England and Wales on the basis of its position as a global financial leader and repository of capital. In particular, it considers the toolbox of measures which English law offers, including Mareva freezing injunctions, worldwide Mareva injunctions and third-party final orders.

The paper further draws on the factual matrix established by the Tribunal and identifies specific factual findings which call for the treatment of Gazprom and Rosneft as extensions of the Russian Federation for the purposes of enforcement proceedings on the basis of the existence of an agency relationship between the parties. The paper finally argues that further, or in the alternative, the Yukos shareholders can directly trace specific Yukos assets, or their proceeds, to Gazprom and Rosneft on the theory that the transfer of expropriated assets by the Russian Federation to the two entities represented a transaction at an undervalue which was intended to defraud or prejudice the interests of the Yukos shareholders. However, each of these available remedies and causes of action is susceptible to challenges which the paper addresses by identifying the pitfalls that the Yukos shareholders should seek to avoid, suggesting alternatives and potential solutions to each of the limitations presented.

Articles in this series of Yukos papers so far:

Fruits of the Poisonous Tree: The Admissibility of Unlawfully Obtained Evidence in International Arbitration
by J.H. Boykin and M. Havalic
on OGEL and TDM

Mammoth Arbitrations: the Yukos Awards of 18 July 2014
by S. Nappert
on OGEL and TDM

Yukos and Contributory Fault by W. Sadowski
on OGEL and on TDM

What's Tax Got To Do With It? The Yukos Tribunal's Approach to Motive and Treaty Interpretation
by R. Teitelbaum
on OGEL and on TDM

Winning the Battle Does Not Mean Winning the War: Challenges Facing the Yukos Shareholders in Enforcing Their Arbitration Awards Against the Russian Federation in England and Wales
by M. Davies
on OGEL and on TDM

Yukos v. Russian Federation: Observations on the Tribunal's Ruling on Damages
by by B. Sabahi and D. Ziyaeva
on OGEL and on TDM