CYIL vol. 13 (2022)

CYIL 13 ȍ2022Ȏ REPARATIONS TO CORPORATIONS: JUST SATISFACTION AWARDED … The practice of the Committee of Ministers, as far as possible, follows that of the ECtHR. Thus, if there are doubts as to whether the court-appointed administrator/liquidator really represents the applicant’s interests, it has been accepted that the payment should be made to the applicant’s lawyer. 85 If the company ceased to exist in the course of the proceedings before the ECtHR , its shareholders will receive the compensation awarded. In the case of OAO Neftyanaya Kompaniya Yukos v. Russia , the application was lodged with the ECtHR by OAO Neftyanaya Kompaniya Yukos (the applicant company). 86 In the course of the proceeding before the ECtHR the applicant company ceased to exist. Accordingly, the ECtHR decided that the amount of just satisfaction should be paid by the Russian government to the applicant company’s shareholders and their legal successors and heirs. In order to facilitate the government’s task, the ECtHR referred to the list of the applicant company’s shareholders, as they stood at the time of the company’s liquidation. The interesting fact is that this list of the company shareholders was held by a legal entity, ZAO VTB Registrator. 87 The costs and expenses in this case were assigned to the Yukos International Foundation, a Netherlands based foundation. This foundation was created by the applicant company with a view to distributing, after the payment of the creditors, any funds received and to be received by it through a scheme to shareholders of Yukos Oil Company. The Russian government contested the awarding of any compensation to this foundation. They pointed out that the beneficiaries of the Yukos International Foundation were anonymous, that there was a risk of double compensation because some of the applicant company’s shareholders were pursuing legal proceedings in other venues, and that there was no guarantee that the interests of all shareholders would be reflected in the distribution of awards by this entity, rather than the interests of merely some of them, who were likely to be the ‘least deserving’. Initially, the representatives of the applicant company before the ECtHR requested that the whole sum of just satisfaction, including pecuniary and non-pecuniary damage, should be paid to the foundation. The ECtHR decided not to accept the applicant company’s suggestion that payment be made to the Yukos International Foundation, as the case file contained no evidence confirming who exactly in such a circumstance would benefit from the award in this case. Nonetheless, it agreed to pay to the foundation costs and expenses without providing any explanation on this account. This decision was quite exceptional as the foundation at issue was neither a liquidator, nor a legal representative of the applicant company. If the corporation ceased to exist after the delivery of the judgment by the ECtHR before the end of the execution proceedings at the Committee of Ministers , the decision on the rules of payment of just satisfaction award will be taken by the Department for the Execution of Judgments of the European Court of Human Rights (the Department). The mechanism of reparation of such a corporation will depend on the exact legal situation of the applicant company. It will include the questions on the nature of violation, the position of remaining shareholders of the corporation, existence of the special funds, etc. The best solution will be to conclude an agreement between the government of the respondent state

85 Monitoring of the payment of sums awarded by way of just satisfaction: an overview of the Committee of Ministers’ present practice, cited above. 86 OAO Neftyanaya Kompaniya Yukos v. Russia (just satisfaction), no. 14902/04, § 1, 31 July 2014. 87 OAO Neftyanaya Kompaniya Yukos , cited above, § 38.

173