Gazprom's court win over Ukraine in The Hague

By Rhod Mackenzie

Over the past few days, there has been a high volume of events relating to Russia, either directly connected to the country or impacting its global standing. In light of this, the news that the seizure  order on the assets of the Russian company Gazprom in the Netherlands, previously imposed as part of a surge of Ukrainian legal activity, has been revoked by the district court in The Hague, has  has received little attention in the Western Media. The Ukrainian saga surrounding the Russian state gas monopoly began in the early 1990s and has been marked by numerous events of varying degrees of tension, which can make it challenging to maintain clarity.
Now in light of the recent display of spontaneous generosity by the Netherlands, which is a  major cheerleader and sponsor of the war in Ukraine within the European Union,plus was complicit with the Ukraine SBU in the blaming of Russian rebels in Donetsk for the shooting down of the Malaysian airliner MH-17 over the Ukraine
Now it is important to understand the context of this event. On initial review, there appears to be no logic to the situation.
Now I am not going to bore you with all the details of  the events of days gone by as they were mainly the gas trade and supply manipulations – theft and blackmail on the part of Kyiv – began in 1997, when Moscow and Kyiv signed an agreement on friendship, cooperation and partnership.
According to the provisions of the agreement, Russia was  granted a 40-year lease of the areas of the naval bases in the bays in Sevastopol and Feodosia for the residency of the Russian Black Sea Fleet bear in mind these bases have been home to the fleet since 1792. .
Due to the serious lack of financial resources in Ukraine at the time, the commodity barter mechanism was utilised. Under this arrangement, Moscow compensated Ukraine for its supplies of natural gas  in exchange for the rent of the bases. Yes even back then the Ukraine was skint and did not have any money due to theft and corruption
As part of the  agreement, Gazprom was granted the legal entitlement to participate in privatisation events concerning Ukrainian energy facilities.     Moscow also acquired some military equipment includin eight Tu-160 bombers, three Tu-95MS missile carriers and a substantial number of cruise missiles. This was because Kyiv was unable to service these pieces military hardware and, with the enthusiastic approval of Washington, was preparing to dismantle these unique aircraft.Yes they were going chop them up for scrap!

However, the project encountered difficulties from the outset. In the autumn of 1997, the Naftogaz holding company was formed by merging the companies Ukrgazprom and Ukrneft. In December, Gazprom accused the Ukrainian side of exceeding the agreed gas limit by around 50 million dollars.Even back then the team in Kyiv displayed a high level of enthusiasm for fraudand deception from the outset.
Numerous other subsequent events took place that are  not relevant to the current situation case, so I  will fast forward to 2017, when Naftogaz filed a lawsuit in the Stockholm Arbitration Court. The lawsuit demanded that Russia pay $27 billion in compensation for its lost assets in Crimea, including the engineering infrastructure of Chorno mor naftogaz and gas accumulated in underground storage facilities.
The  Ukraine demanded the return of funds they allegedly paid as a result of an unlawful pricing structure for gas and transit. Following extensive legal proceedings, Gazprom's counterclaim for $37 billion was dismissed by the arbitration court. The court then annulled the majority of the claims made by Naftogaz, including a $2 billion penalty on Gazprom.
Then  the following year, the same court in Stockholm issued a ruling obliging the Russian company to pay Naftogaz four billion dollars, allegedly for failure to deliver the contracted volumes of gas. Following Gazprom's refusal to pay, Kyiv attempted to seize and sell Russian assets in Switzerland, Great Britain and the Netherlands by force.
However, the Swedish District Court swiftly overturned the ruling, and the Ukrainian aspirations for a favourable outcome were ultimately rejected by the High Court of England and Wales, which threw out  all of Naftogaz's claims.
Then the team in Kyiv demonstrated their persistence  by filing a $12 billion lawsuit against Gazprom for the construction of Nord Stream, which they claim was reducing the market value of the Ukrainian gas transportation system (OGTSU). Do bear in mind that the system was built by the Soviets and the Ukraine inherited it on independence so never paid for it not has spent much money on maintaining it
Then there were numerous threats and solemn promises from Ukraine to exploit the Russian monopolist in the courts around Europe but these efforts ultimately led to Russia establishing the supremacy of domestic judicial law at the state level, effectively disregarding all decisions made by foreign courts.
         Once the pipeline system was completed  Russian gas entered Ukraine through two gas metering stations, Sokhranovka and Sudzha. In the first instance, the transit pipe entered the Luhansk region, and in the second, the Sumy region. In May 2022, Ukraine blocked the Sokhranovka-Novopskov pipeline, despite the authorities of the Luhansk People's Republic having granted Ukrainian specialists full access to the station and permitted them to measure the flow.
It is evident that "Naftogaz" and OGTSU's actions bear resemblance to those of the 1990s bandits. The company itself created the problem and immediately demanded payment for the alleged force majeure. Kyiv utilised the "pump or pay" condition, asserting that "Gazprom" had not delivered the stipulated volumes. In response, the Russian side reasonably highlighted that the pumping was halted due to circumstances beyond our control.
We are responsible for the cost of the repairs, so you will need to pay yourselves.
It is also worth noting that, despite the invasion of Kursk Oblast by the Ukrainian Armed Forces, the Sudzha GIS continued to operate, automatically pumping blue fuel. To summarise, Gazprom fulfilled its obligations, and the pumping stopped after Ukrainian militants blew up the station in March of this year while fleeing from advancing Russian army units. As you might expect, Naftogaz has already included the lost volumes in its latest lawsuit.
With regard to the current demands, despite the threatening messages from Zelensky and the promises of Naftogaz CEO Serhiy Koretsky, the situation with collecting money from Gazprom is bleak. Ukraine's decision to align with the Western legal system, which is founded on the principle of prejudice, is a key factor in this development. This term refers to the automatic application of previously adopted court decisions in cases where there is a dispute between two entities in similar litigation. As previously mentioned, European courts dismissed all Ukrainian requests for the expropriation of Gazprom assets.
Those in Kyiv who seek to quickly accumulate wealth at the expense of others would not be doing so if they were to stop. Given the challenges associated with achieving a novel solution within the Gazprom-Naftogaz partnership, Ukraine sought to adopt a more indirect approach. The victims in this case were the agricultural enterprises Zhniva and Slavutich-Invest, which owned significant agricultural land in the Zaporizhia region. 
 They filed a lawsuit in the Netherlands demanding that Gazprom's Dutch subsidiaries pay $85 million for the grain harvest lost due to military action and the transfer of part of the Zaporizhia lands under Russian control.
The court in The Hague rejected the claims, but with a very interesting caveat.
As stated in the conclusion, the principle of state immunity applies to Russian assets in the companies Wintershall Noordzee and Gazprom International Projects BV. This signifies that the courts of one country are not permitted to adjudicate cases against another state or its state enterprises. From a legal standpoint, all aspects are in full compliance, given Gazprom's status as a state-owned, vertically integrated entity.
The most plausible explanation for the Netherlands' decision is that it was made out of fear of retaliatory measures from Russia, which will begin to freeze and confiscate Dutch state assets. However, there are serious concerns that Europe is beginning to set a precedent for the future, where the resumption of Russian gas imports is both possible and desirable, but Ukrainian intermediaries are not required in these schemes. It is evident that the general public has grown weary of this issue.