Court of England postpones decision in debt dispute between Ukraine and Russia
The English Court of Appeal after a five-day consideration of Ukraine's appeal against the decision of the High Court of Justice in England on Russia's claim to recover the debt on $3 billion eurobonds has decided to postpone the final judgment, according to the website of the Finance Ministry of Ukraine.
"Today saw the conclusion of the hearing of Ukraine's appeal to the English Court of Appeal against the summary judgment decision made in favour of Russia's Trustee… At the conclusion of the hearing, the judges reserved their judgment until a later date. The results of the appeal proceedings will be announced after the English Court of Appeal hands down its judgment," the ministry said.
The ministry said that Ukraine puts its faith in the English legal process and remains confident of achieving a positive outcome in the proceedings.
As reported, in December 2015, Ukraine defaulted on $3 billion in eurobonds the country had bought from Russia shortly before a change in government in Kyiv, along with $75 million in the final coupon payment. Ukraine proposed that Moscow accept the same debt restructuring terms reached with Ukraine's major commercial creditors, but Russia rejected the idea, insisting that the bond was sovereign debt. Ukraine was to clear the debt before January 1, 2016. However, Kyiv imposed a moratorium on servicing this debt in December 2015 and failed to pay a total of $3.075 billion before January 1, 2016 toward servicing and clearing the eurobonds belonging to Russia.
After that, the Russian Finance Ministry filed a lawsuit in High Court on February 17, 2016, seeking to secure repayment of the debt. The High Court ruled on March 29, 2017 to endorse a quick procedure for hearing the suit, in fact rejecting Ukraine's principal objections and agreeing that it had a debt on eurobonds. The court recognized that the transaction was a standard one, even though it was concluded in unusual circumstances. However Russia is unable to collect debt on the $3 billion eurobond until a decision is pronounced on an appeal lodged by Ukraine.
The decision of the English Court of Appeal could be challenged with the Supreme Court.
