Naftogaz wins lawsuit against Gazprom’s appeal in Stockholm arbitration court

The Svea Court of Appeal of Sweden has rejected an appeal filed by Russian gas giant Gazprom against a 2017 decision made by the Arbitration Institute of the Stockholm Chamber of Commerce (SCC) in a bilateral legal dispute concerning gas contracts between the two countries.

The ruling reinforced two previous decisions of the SCC, binding the Russian gas company to keep its then gas prices for Ukrainian consumers in line with market standards, cancel its “take-or-pay requirements” and gas re-exports from Ukraine.

“The judgement means that the actions of Gazprom are dismissed and that the special arbitration will not be set aside in any way. As part of the assessment, the Court of Appeal found that there was no evidence that there was an error in the procedure,” the Swedish court found.

The ruling comes amidst ongoing talks between Gazprom and Naftogaz on a gas transit deal starting from 2020 and a potential agreement on purchasing Russian gas for Ukrainian consumption. The Russian side demanded that all ongoing legal disputes should be dismissed to reach a gas transit agreement.

Based on the findings, Gazprom still has to settle a debt of three billion US dollars for Ukraine which might be repaid with gas supplies, Yuriy Vitrenko, Naftogaz’s executive director said earlier this week.

“At present, we do not see any legitimate reasons for not concluding a new contract for the transit of gas through Ukraine according to European rules, and we express our willingness to work honestly on this,” Mr Vitrenko stressed, adding that Ukraine is still aiming to reach a long-term agreement against Russia’s proposal to extend the current deal or sign one for 2020 only.