Ukraine will ask the British Supreme Court on December 9 to not compel it to pay nearly $ 4 billion in debt to Russia from a Eurobond that Moscow had refused to have restructured when Kyiv’s economy nosedived following the Maidan pro-democracy movement nearly six years ago.
Kyiv is seeking for a favorable ruling in London because the debt was structured under English law and which should’ve been repaid in December 2015 when the $ 3 billion Eurobond matured.
However, Moscow is asking for a summary ruling to force Kyiv to pay the amount with interest without a trial going forth in what is part of their bigger geopolitical tussle that includes the occupation of Ukraine’s Crimean Peninsula, Russia fomenting a separatist military conflict in the easternmost Luhansk and Donetsk regions, and the weaponization of energy supplies.
So far, Kyiv – in wishing to challenge the debt in court – has managed to convince British judges in lower courts that the Eurobond was issued under duress.
When former President Viktor Yanukovych’s administration sold the debt to Russia in December 2013, Moscow was applying “massive, unlawful, and illegitimate economic and political pressure to Ukraine” then, according to Alex Gerbi, a partner at the law firm representing Kyiv in the case.
A month earlier, Yanukovych had rejected a wide-ranging political and trade accord with the European Union known as an association agreement that led to protests in Kyiv demanding the decision be reversed.
Those protests grew to include calls for Yanukovych’s ouster and he eventually fled the country for Russia in February 2014 in the wake of deadly shootings in Kyiv where about 100 protesters were killed.
Moscow invaded Crimea the same month and annexed it from Ukraine after which the armed conflict in eastern Ukraine began in April 2014.
Former Finance Minister Natalie Jaresko then tried to include the Russian Eurobond in a 2015 restructuring plan that included other liabilities, a process in which Moscow refused to participate.
International investors are observing this case related to the overall sovereign debt restructuring of $ 18 billion and the upcoming December 19 case in Kyiv concerning the nationalization of PrivatBank, Ukraine’s largest commercial bank that once belonged to billionaire Ihor Kolomoyskiy.