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Ukraine court to consider UESU debt to RF Defence Ministry

Kiev has already paid 15 million hryvnia (1.88 million US dollars) of the total sum

KIEV, January 21 (Itar-Tass) — The Supreme Economic Court on Monday considers an appeal against the decision of the Appellate Economic Court of Kiev, which upheld the decision on the payment by the Ukrainian government of debts of the United Energy Systems of Ukraine (UESU) corporation to the Russian Defence Ministry in the amount of 3.1 billion hryvnia (375 million US dollars). The hearing was to be started at 12:00 MSK.

This debt formed in the late 1990s, when the UESU, led then by Yulia Timoshenko, failed to fulfil the guaranteed by the government of Pavel Lazarenko agreement of 1997 on the supply of products by the corporation to the Russian Defence Ministry.

Earlier, the RF Defence Ministry turned to the Commercial Court of Kiev over the issue of the payment by the Ukrainian government of the UESU debts. In addition to the Ukrainian Cabinet, the Russian side demanded that the State Treasury should also be sued. On September 19, 2012 the Kiev Economic Court partially granted the suit of the RF Defence Ministry, but on September 25 of the same year, a representative of the country’s Cabinet of Ministers appealed the judgment. Appeals were also filed by the State Treasury and the UESU and were consolidated into one case. On December 3 last year, the Kiev Economic Court of Appeal upheld the decision on the payment of the debts, and on December 17 Ukraine filed an appeal against the verdict with the Supreme Economic Court.

Last Friday, Ukrainian Prosecutor General Viktor Pshonka announced that the republic has begun the payment of the UESU debt to the Russian Defence Ministry. According to him, Kiev has already paid 15 million hryvnia (1.88 million US dollars) of the total sum. “The payment has already begun – 15 million hryvnia have already been paid to Russia,” said the prosecutor.

Simultaneously, the Kiev district court of Kharkov continues hearing of the criminal case against Ukraine’s former Prime Minister Yulia Timoshenko, accused of violations at a time when she headed the UESU. In October 2011, the Security Service of Ukraine (SBU) opened a criminal case against Timoshenko for the transfer of corporate debt to the balance of the budget of Ukraine. The former prime minister is also accused of the organisation of tax evasion amounting to over 4.7 million hryvnia (some 600 thousand US dollars), embezzlement and attempted embezzlement of budget funds by illegal reimbursement of more than 25 million hryvnia (more than 3 million US dollars) of the VAT tax, forgery and evasion of payment of income tax worth 681 thousand hryvnia (76.5 thousand US dollars). Yulia Timoshenko’s defence lawyers insist that the case against UESU had been closed back in 2005, and this has been confirmed by the Supreme Court of Ukraine.

Timoshenko was not present at last Friday’s court hearing taken for health reasons. The next court hearing is scheduled for February 12.

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