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Court clears Russia of trying to destroy Yukos

Yukos sought colossal damages of USD 98 billion over claims it was illegally targeted by the state over tax fraud.



Strasbourg: The European Court of Human
Rights cleared Russia`s government on Tuesday of trying to destroy
defunct oil giant Yukos in a ruling Moscow said proved its
actions were not politically motivated.

Russia had not "misused" proceedings "with a view to
destroying the company and taking control of its assets", the
court said in the judgement, which can be appealed within
three months.

Moscow immediately hailed the outcome. But, judges at the
Strasbourg-based court also found that Yukos` fundamental
rights were flouted on several counts in tax proceedings
against it.

Yukos, once headed by jailed opposition figure Mikhail
Khodorkovsky, sought colossal damages of USD 98 billion over
claims it was illegally targeted by the state over tax fraud.

Judges delayed their decision on damages, potentially the
largest penalty ever awarded by the court, which could take
several months or even years to rule on, according to a court
spokesman.

The court ruled that the authorities violated the right
to a fair trial in the European Convention on Human Rights by
giving the company insufficient time to prepare its defence
case in 2000 tax assessment proceedings.

And the court also ruled that there had been a further
breach regarding the imposition and calculation of tax
penalties.

However it added that "there was no indication of any
further issues or defects in the proceedings against Yukos
which would have enabled the court to conclude that Russia had
misused those proceedings to destroy Yukos and take control of
its assets."

Former officials at Yukos, dissolved in 2007, also
welcomed the ruling.

"The issues that we lost on are not the critical issues,"
Bruce Misamore, Yukos` former chief financial officer told
reporters in London, adding the political issues of the ruling
were "cosmetic".

Steven Theede, Yukos` former chief executive officer who
resigned in 2006 and led the suit against Russia in
Strasbourg, also expressed satisfaction.

"The court found the crux of the case was the speed with
which the Russian authorities demanded that Yukos pay the
taxes, despite the fact its assets were frozen," he said.

For its part, Russia claimed it had been exonerated.

Bureau Report

From Zee News

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