The following letter from the law professor Emmanuel Gaillard, representing the former shareholders of Yukos, was published in the Financial Times.
From Prof Emmanuel Gaillard.
Sir, Almost unnoticed, Vladimir Putin, the prime minister, announced in July that Russia will withdraw from the Energy Charter Treaty. This is a significant setback for its European partners. Since its adoption in 1994, the ECT has established a unique balance and a level playing field in the energy sector for all 50 partners, including Russia.
This is a signal to the international community that Russia refuses to live by its international commitments and is not interested in protecting future energy investments.
It is nocoincidence that this comes at a time when the former majorityshareholders of Yukos oil company are awaiting an internationaltribunal decision regarding, precisely, whether and to what extentRussia is bound by the ECT. The former shareholders are seeking over$50bn in compensation for the discriminatory and illegal expropriationof their investment in Yukos.
This latest act of Russianunilateralism in no way means that Russia can walk away from itspre-existing legal obligations. Russia’s withdrawal will have no impacton the Yukos case, nor will it affect the rights of other existinginvestors in Russia’s energy sector. Those investments benefit from a20-year survival protection under the terms of the ECT.
Withinthis context, there should be little doubt that Russia’s withdrawalfrom the ECT is anything more than a pre-emptive strategy, to sowconfusion and discord, in anticipation of an unfavourable precedent inthe Yukos tribunal regarding the binding nature of the ECT for the 20years to come vis-à-vis investments made prior to the withdrawal.
Professor of Law,
Paris XII University, France
Lead counsel for the majority shareholders of the former Yukos oil company