Yanukovych Debt: Ukraine ready to negotiate 'Yanukovych loan' with Russia but prepares for London trial – Finance Minister

11:59 Sep. 13, 2016

Ukraine ready to negotiate 'Yanukovych loan' with Russia but prepares for London trial – Finance Minister

Ukraine's Finance Minister Oleksandr Danylyuk talks to Ukraine's Prime Minister Volodymyr Groysman (UNIAN photo)

The debt in question is the USD 3 billion loan Russia provided Ukraine with in late 2013 when Moscow-backed Viktor Yanukovych was president

Acting in compliance with the current program, approved by the International Monetary Fund (IMF) regarding carrying out negotiations with Russia in "good faith", Ukraine is ready to enter into further talks to solve a dispute over a USD 3 billion loan received in December 2013 as part of an agreement between Russian President Vladimir Putin and then President of Ukraine Viktor Yanukovych, according to Finance Minister Oleksandr Danylyuk.

Read also British court to hear Russian case over Kyiv's USD 3 billion loan default

The minister underscored that Ukraine had clearly set out its objections to Russia's claim that were submitted on May 27, 2016 in the framework of the proceedings being held at the English court, and stressed that the country was strictly adhering to this position.

"Despite the fact that Ukraine generally remains open to the possibility of an amicable settlement of the dispute should acceptable grounds be found for that, Ukraine is confident in its legal position and focuses on preparations for the hearing, which is scheduled for January 2017," Danylyuk said, commenting on Russian Finance Minister Anton Siluanov's statement that the consideration of Russia's claim regarding Viktor Yanukovych's debt would be launched at the High Court in London in early 2017, and that Russia was ready for a pre-trial settlement.

Read also Ukraine will not pay off ‘Yanukoych debt' to Russia

"Any such negotiations, which could take place at an appropriate time, for example, in the course of the upcoming meetings with the IMF during the week of October 3, 2016, do not interfere with Ukraine's position regarding the court proceedings mentioned," Danylyuk added.

The debt was negotiated between Russian President Putin and former Ukrainian President Yanukovych in the form of a Eurobond issue worth USD 3 billion in December 2013, maturing in December 2015.

Russia lodged a suit with the London High Court against Ukraine after Kyiv defaulted on paying the principal amount and interest on a billion loan. The fact that the bonds were purchased via the Irish Stock Exchange makes the disbursement a private creditor debt. However, the Russian side insisted that this was an interstate debt, as the buyer was the state-owned National Wealth Fund. Ukraine sought the billion Eurobond to be restructured under sovereign and sovereign-guaranteed bonds, but Russia reiterated it did not consider the debt as commercial.

In the course of negotiations, Russian authorities also insisted on better restructuring terms than those offered to other creditors, which is prohibited by the bond swap memorandum between Ukraine and the bond holders.

Reporting by UNIAN

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