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European Court of Human Rights finds judicial proceedings violated Yukos Oil Company’s rights

Source: HRO.org (info), 20/09/11

The European Court of Human Rights has ruled that the actions of Russian tax authorities violated the Yukos oil company’s right to the protection of its property. However, the Court did not find that the actions of the Russian tax authorities were politically motivated, news agencies reported, citing the website of the European Court of Human Rights.

The European Court ruled that Russia was in breach of Article 6, paragraphs 1 and 3b, of the European Convention on Human Rights and Fundamental Freedoms in relation to tax assessment proceedings for 2000 (the right to a fair trial). The company was not given adequate time to prepare for the court hearings.

The Court found a violation of Article 1 of Protocol 1 (protection of property) in relation to tax assessments and the imposition and calculation of penalties for 2000–2001. However, the Court ruled that Article 1 of Protocol 1 of the European Convention was not violated in the period 2001-2003.

The Court ruled that the rights of the company were violated under Article 1 of Protocol 1 of the Convention (protection of property): the Russian authorities did not strike a fair balance between the legitimate aims sought and the measures employed, in violation of Article 1 of Protocol No. 1.

The European Court did not find that Russia had violated Article 14 of the European Convention that prohibits all forms of discrimination. Similarly, the Court found that there had been no violation of Article 18 of the European Convention (limitation on use of restriction on rights).

The European Court by a majority overruled government objections to a series of positions taken by Yukos: on the exhaustion of domestic remedies; on the seizure of the applicant company’s shares during legal proceedings; on the failure of court bailiffs to provide the applicant access to the materials of the case; on the issue of the shares of the Sibneft oil company; on the payment of a 7% fine on all delays on payments ordered by a court; on the circumstances of the evaluation and sale of Yuganskneftegaz.

Yukos shareholders have demanded the unprecedentedly high sum of $98bn in compensation for losses incurred. However, the decision on compensation has been postponed. The sides have three months to reach an out-of-court settlement.

The text of the judgment (in English) has been published on the website of the European Court of Human Rights.

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