Ukraine's Supreme Court returns Ukrtelecom case for retrial

The Supreme Court of Ukraine has considered an appeal by Ukrainian businessman Rinat Akhmetov's ESU company against court rulings terminating a deal to privatize 92.8% of shares of Ukraine's telecoms giant Ukrtelecom and returned the case for retrial by a court of first instance.

"The court ruling has come as a surprise. We were preparing for a different decision and for joint action with the Cabinet of Ministers of Ukraine to return this asset to the state," acting head of the State Property Fund (SPF) of Ukraine Vitaliy Trubarov told UNIAN on July 5.

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The SPF has not decided on further actions yet, he said.

"I think we're going to hold a joint meeting with our lawyers on Monday. Perhaps we will invite Cabinet members or go to them to figure out our further tactics for that issue," Trubarov said.

As UNIAN reported, the Supreme Court earlier did not support the State Property Fund's demand that Ukrtelecom's property should be seized.

In 2011, ESU LLC (owned by the Austrian company EPIC, now Raga Establishment) bought Ukrtelecom from the state, having paid UAH 10.57 billion for the 92.79% stake. In 2013, Akhmetov's System Capital Management (SCM) holding bought the telecom operator's shares. In May 2017, the SPF appealed against ESU in court, demanding the cancelation of the contract on the operator's shares sale due to the failure to fulfill investment obligations estimated at US$450 million.

On October 19, 2017, a Kyiv-based economic court considered a lawsuit lodged by the State Property Fund and revoke the contract concluded in March 2011 following a privatization tender to sell Ukrtelecom shares to ESU, thus returning Ukrtelecom to state ownership.

On December 12, 2017, the Court of Appeals refused to satisfy ESU's lawsuit challenging the decision by a court of previous instance, according to which Ukrtelecom was to be returned to state ownership.