2023-07-05 09:34:14
Euroclear,
05 июл, 12:34
The Moscow Arbitration will consider the first claim of a private investor against Euroclear
The Moscow Arbitration Court for the first time accepted a lawsuit from a private individual against the international depositary Euroclear. The third parties in the case are NSD and the management company of Rosselkhozbank
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The first private investor filed a lawsuit against the international depository Euroclear with the Moscow Arbitration Court, according to data on the website of the service “Electronic Justice”. First to it noticed Telegram channel Invest.Lawyer of sanctions lawyer Elena Ryazanova.
The claim was filed on June 20 on behalf of Elida Khasanova, the court accepted the claim for consideration on July 4. The defendant in the case is the depository of Euroclear Bank, the National Settlement Depository (NSD) and the management company RSHB Asset Management are listed as third parties. According to the case file, the hearing on the lawsuit will take place on September 13.
At the end of February of this year, the Moscow Arbitration Court satisfied a lawsuit by Saint Petersburg Bank against Euroclear Bank for the recovery of $107.1 million and €489 thousand, and then a higher court partially changed the decision at the request of the bank itself and decided to recover $107.1 million in ruble equivalent from the European depository, and also took into account the refusal of the bank “Saint-Petersburg” from the requirements for Euroclear in the European currency. The lawsuit against Euroclear was filed in September 2022.
Intention to apply to the judiciary declared and representatives of the Investor Protection Club. Legal consultant Delcredere will work out “methods of judicial protection in the national courts of Belgium and Luxembourg, as well as in international courts for a wide range of investors whose assets are under blocking,” the Club said.
The Investor Protection Club proposed to file a lawsuit in international arbitration
Earlier, Nikita Akimkin, a representative of the Investor Rights Protection Club, director of the VTB Brokerage Services Department, noted that one of the ways to protect the rights of Russian investors could be to apply to international arbitration. “In addition, it is worth considering a centralized filing of a claim from Russian investors or professional participants in the securities market in international investment arbitration aimed at protecting investments in accordance with international charters and agreements,” Akimkin said.
Lawyer, partner of BGP Litigation Sergey Glandin explained that we are talking about agreement between the government of the USSR and the governments of the Kingdom of Belgium and the Grand Duchy of Luxembourg on mutual encouragement and mutual protection of investments of 1989, in which Russia participates as a successor.
The expert said that he considers this method of protecting the rights of Russian investors to be potentially very effective, the chances of success in this case may exceed 50%, but the disadvantage of this mechanism is that it has never been used in practice.
The second month without a response on unlocks: what lawyers advise investors
Previously, lawyers have already recommended that private investors, in the event of inaction by the authorities of Belgium and Luxembourg or a negative response to applications, apply for protection to the national administrative court, and if they do not find a fair solution there, then to the European Court of Human Rights.
In addition, investors who have received refusals can also appeal the decision of the Treasury to the State Council of Belgium with a complaint about the violation of the deadlines for responding to an appeal, which are 30 days by default, Sergey Glandin said. If the department has not warned about the delay in responding to the appeal, this may become the basis for a complaint.
NSD is Russia’s central depository. It keeps records of ownership of Russian securities held by investors. NSD settles transactions and also acts as an intermediate storage facility for certain foreign securities traded on the St. Petersburg Exchange and the Moscow Exchange.
NRD has accounts in the international depositories Euroclear and Clearstream, which ceased to conduct operations on them in March 2022. From June 3 last year, NSD fell under EU sanctions, some of the securities of Russian investors were frozen, and dividends and coupons on them stopped coming. Payments are accumulated in foreign depositories, but cannot reach the accounts of Russians.
European Commission declared in the publication of the official journal of the EU, which allows the unfreezing of the blocked assets of the Russians if they complete transactions and transactions concluded before June 3, 2022. Foreign counterparties were given the opportunity to conduct transactions with the Russian depository until January 7, 2023, subject to a number of conditions. The deadline is set by the EU regulation 269/2014.
Russian brokers and management companies reported that they managed to file applications with the EU authorities before January 7 – on this very day the license issued by the Belgian Ministry of Finance to NSD expired.
On December 20, NSD received a general license from the Ministry of Finance of Luxembourg, which allowed it to unlock securities of non-sanctioned entities that were stuck in Clearstream due to sanctions against NSD. And on December 22, the Ministry of Finance of Belgium, the regulator of the Euroclear depository, also gave permission for the withdrawal of assets to the Russian depository. The general licenses of the depositories provided that applications for the release of securities could be submitted until January 7, 2023.
However, the NRM stated that the general permission of Luxembourg could not be enforced. According to its terms, Clearstream should be the only applicant, accordingly, the Luxembourg depositary was required to completely terminate the contractual relationship with NSD for all assets. According to Clearstream, this seemed impossible.
NSD noted that, as an alternative mechanism, Luxembourg’s Ministry of Finance would consider issuing licenses to individual applicants, similar to the Belgian Treasury. However, on the website of the Ministry of Finance of Luxembourg saysthat the agency “will not issue individual permits”.
In addition, in August last year, the central depository sued on the lifting of sanctions to the Court of Justice of the European Union in Luxembourg.
NSD may not wait for licenses to be unlocked: 4 options
Author: Ksenia Kotchenko.
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