MOSCOW — Russia's largest oil company Rosneft said on Wednesday that it has settled a long-standing dispute with now-defunct oil company Yukos, whose owner spent 10 years in a Russian prison.
Yukos was dismantled in 2003 and sold in pieces through shady intermediaries to Rosneft, making it Russia's largest oil producer. Yukos' owner, Mikhail Khodorkovsky, spent 10 years in prison on tax evasion charges which were largely described as politically motivated before he was pardoned by President Vladimir Putin and released in December 2013.
Rosneft, which is led by President Vladimir Putin's long-time associate Igor Sechin, who was seen as the principal force behind the demise of Yukos, said in a statement that Yukos shareholders agreed on a settlement that will cease all litigation between them. A representative for Yukos shareholders confirmed the announcement.
The details of the settlement weren't disclosed, but Rosneft said in the statement that "the agreement does not provide for any monetary or other compensation on the part of Rosneft or its subsidiaries."
Claire Davidson, a Yukos representative, confirmed the agreement, but said it doesn't affect Yukos' claim against Russia in the European Court of Human Rights. She wouldn't comment on the terms of the settlement, citing confidentiality.
The decision, however, doesn't affect recent court decisions that ruled in the favor of the Yukos shareholders.
In what has been described as one of the largest arbitration awards in history, the Permanent Court for Arbitration ruled in July that Russia must pay $50 billion for using tax claims to destroy Yukos. The court said Russia had used tax claims to take control of Yukos in 2003 and silence Khodorkovsky, an opponent of Putin who had begun to use his vast wealth to fund opposition parties challenging Putin's power. Khodorkovsky was arrested at gunpoint as he boarded a plane in Siberia that year and spent more than a decade in prison as Yukos' main assets were sold off.
Following the dismantling of Yukos, its shareholders, excluding Khodorkovsky, who gave up his claims, have been suing Rosneft in court.
The dismantling of Yukos and the arrest of Khodorkovsky were a defining moment in Putin's rule.
In the early 2000s, Putin forged a deal with Russian businessmen who had created empires by snapping up the jewels of the Soviet state in oil, gas and metals. The Kremlin offered its protection for the oligarchs' often murky deals. In exchange, the tycoons pledged to not meddle in government policy. Khodorkovsky was the only man who broke this rule.
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