Appeals court upholds Stockholm Arbitration Court ruling on OPP debt to Ostchem, opens way to bankrupting enterprise
The Odesa region's appeals court on May 10 upheld the decision of the Yuzhne city court on satisfying a motion by Ostchem, owned by Dmytro Firtash, on implementing the ruling of the Stockholm Arbitration Court to collect $193 million in debts from the Odesa Port-Side Chemical Plant (OPP), not including fines and penalties, according to acting head of Ukraine's State Property Fund (SPF) Dmytro Parfenenko.
"The Odesa region's appeals court yesterday declined all our appeals and motions and left in force the ruling of the Yuzhne city court … This opens the door to the potential bankruptcy of the OPP, a key enterprise in the region," he said during a Cabinet of Ministers meeting in Kyiv on Thursday.
Ukrainian Prime Minister Volodymyr Groysman tallied the total debt at around $300 million.
According to Parfenenko, the SPF is preparing to appeal the ruling and seeking a stay of the decision, as well as taking a number of legal steps to prevent OPP's bankruptcy.
"This all creates the impression of some kind of deliberate campaign to destroy the investment potential of the enterprise. One conclusion is as follows: this shows that OPP's privatization is required as quickly as possible … and the need to conduct a search for an effective owner of the plant," he said.
Groysman asked whether OPP's lawyers appeared at the appeals court hearing.
"Absolutely … We switched lawyers, that is, OPP switched lawyers …. This company is a subsidiary of the [Kyiv-based] Vasil Kisil & Partners law firm. The lawyers filed a number of motions to appeal, however yesterday [May 10] they did not appear in court. Today at 12.00 the deputy SPF head is charge of the case is conducting a meeting with top executives of OPP and their lawyers. We will raise the roof, but the outlook is bleak," Parfenenko said.
Groysman said the situation resembles and "under-the-rug" agreement, or scam.
"I think that a scam is taking place. It began last year when the government in good faith affirmed the public sale of the plant. In August [2016] a plot was hatched to lose one court case, and now others … All this is facilitating the start of bankruptcy proceedings for the enterprise, which belongs to the people. The head of the plant and lawyers hired by the plant are involved," Groysman said.
