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Gazprom appeals for complete reversal of court decision on gas transit via Ukraine

May 28, 19:57 UTC+3

Gazprom and Naftogaz of Ukraine plunged into a litigation over gas supplies and transit contracts with the Arbitration Institute of the Stockholm Chamber of Commerce back in 2014

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© Alexander Ryumin/TASS

MOSCOW, May 28. /TASS/. Gazprom send an application for complete reversal of the decision taken by the Stockholm Arbitration in the dispute between Gazprom and Naftogaz of Ukraine over the gas transit contract to the Svea Court of Appeal, the Russian gas holding said on Monday.

"An extra examination of the text of the decision with engagement of a globally recognized expert linguist showed that a considerable portion of the arbitration award was written by another person, rather than by arbitrators. Obviously, nobody has a right to substitute arbitrators. Direct decision-making by arbitrators is of critical significance for parties to the dispute and interference of a third person in the decision-making process is a gross violation of the arbitration agreement," Gazprom said.

The conclusion of the expert linguist on the authorship of the arbitration decision on transit is a new evidence of serious violations of the Swedish law and arbitration regulations of the Stockholm Chamber of Commerce in consideration of this case, providing grounds for its complete reversal, Gazprom noted.

Gas dispute

Gazprom and Naftogaz of Ukraine plunged into a litigation over gas supplies and transit contracts with the Arbitration Institute of the Stockholm Chamber of Commerce back in 2014.

Gazprom is demanding more than $37 bln from the Ukrainian company for gas under the take-or-pay clause for 2012-2016, for the payment for gas supplied in May-June 2014 and gas debts.

In December 2017, the court ordered Naftogaz to pay Gazprom $2 bln for the deliveries, but reduced the annual contractual volume of purchases to 5 billion cubic meters. At the same time, the "take or pay" condition was preserved for 80% of this volume. This condition will be effective only in 2018.

As for the gas transit contract, in February 2018, the Stockholm court ruled that Gazprom’s obligation will remain (110 billion cubic meters per year). The Russian company should also pay $2.56 bln to Naftogaz for the shortfall in transit volumes.

In March, Gazprom returned Naftogaz prepayment for the March deliveries and notified the Ukrainian company that it was going to start the procedure of termination of contracts. This procedure can take 1.5-2 years.

Gazprom CEO Alexei Miller noted that, guided by double standards, the Stockholm court took asymmetric decisions, which significantly violated the balance of interests of the parties under the agreements.

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