1. This application arises in proceedings brought under the Arbitration Act 1996 (the “1996 Act”) for the recognition and enforcement of certain arbitral awards made against the Defendant (“Russia”) and subject to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”). The application is to lift a stay of the proceedings imposed by an order of Leggatt J dated 8 June 2016 (the “Stay”).
2. The Claimants are entities incorporated in Cyprus (the First and Third Claimants) and the Isle of Man (Second Claimant). They are former shareholders in OAO Yukos Oil Company (“Yukos”), which was an oil company based in Russia. By final arbitration awards of the Permanent Court of Arbitration dated 18 July 2014 (the “Final Awards”) the Claimants were awarded over US$50 billion in compensation, arising out of allegations that Yukos’ assets were unlawfully expropriated by Russia.
3. Since the Final Awards, no payment has been made and over US$7 billion in interest has accrued. Russia is challenging the Final Awards and previous interim awards on admissibility and jurisdiction dated 30 November 2009, together the “Awards”, in the courts of the arbitral seat, the Netherlands. On 20 April 2016 Russia was successful before the District Court of The Hague (the “Hague District Court”). On 18 February 2020 the Court of Appeal of The Hague (the “Hague Court of Appeal”) reinstated the Awards. An appeal to the Supreme Court of the Netherlands (the “Dutch Supreme Court”) is pending.
4. The present proceedings, seeking recognition and enforcement of the Awards under the 1996 Act, were issued on 30 January 2015. By the Stay, they were stayed pending the judgment of the Hague Court of Appeal, with liberty to apply following that decision.
5. The Claimants now exercise that liberty, and apply to lift a stay of these proceedings in order to progress enforcement of the Awards. If (contrary to that primary submission) the court considers that it would be more appropriate for the proceedings to remain in abeyance pending determination of the appeal to the Dutch Supreme Court, then the Claimants ask the court to (a) adjourn the proceedings under s. 103(5) of the 1996 Act, and (b) order that the adjournment be conditional upon Russia providing security in an appropriate amount: which the Claimants submit would be US$ 7 billion.
6. Russia’s position is that these proceedings ought to remain subject to an unconditional stay or adjournment until the final resolution of the appeal to the Dutch Supreme Court (including any reference to the Court of Justice of the European Union (“CJEU”) made in the course of that appeal).
7. For the reasons set out below, I have come to the conclusion that the Claimants’ application should be dismissed, and that the Stay should continue, without the provision of security, pending the final outcome of the proceedings in the Netherlands.