Russian Prime Minister Dmitry Medvedev revealed following his meeting with Russian deputy prime ministers that he ordered the government to hire lawyers and initiate preparations for court proceedings with a view to recovering the $3-billion debt from Ukraine.

"We need to use some measures of protection," he added.

"Members of the Government, Sergei Eduardovich [Prikhodko, the Deputy Prime Minister], please attend to this, as well as other colleagues, please get the Ministry of Finance engaged [...], I would like you to make all necessary decisions in order to address the due institution of the jurisdiction as selected under our agreement with Ukraine in order to settle this dispute. We will have to hire a lawyer and initiate this procedure with due perseverance and care," Medvedev said. First Deputy Prime Minister Igor Shuvalov will also have this issue under control, he said.

Medvedev recalled that on December 20, Ukraine defaulted on the payments to service its $3-billion debt in Eurobonds. "This means that a financial default has occurred; this is a legal fact and even a historical fact, if you will," he said.

There are 10 days of the grace period to go, during which Ukraine may repay the debt without any penalties, he said.

Before the end of December Ukraine is bound to repay $3 billion it owes to Russia, the holder of its Eurobonds issued back in 2013. Kyiv invited Moscow to restructure this issue of debt under the same conditions as offered to holders of its commercial debt. Russia refused to discuss this option, insisting that the nature of this debt is sovereign and not commercial. In November Russia proposed its own scenario: a repayment in installments over three years ($1 billion paid per annum during 2016-2018) with the involvement of the U.S., EU or an international financial institution as guarantors.