LCIA declared the key clauses of the shareholder agreement on Ukrnafta unenforceable

On 26 April 2018, the London Court of International Arbitration announced its decision in the case initiated by Ukrnafta minority shareholders against Naftogaz. The Tribunal concluded that the key clauses of the shareholder agreement between Naftogaz and the companies owned by Ihor Kolomoyskyi on corporate governance at Ukrnafta are unenforceable...

On 26 April 2018, the London Court of International Arbitration announced its decision in the case initiated by Ukrnafta minority shareholders against Naftogaz. The Tribunal concluded that the key clauses of the shareholder agreement between Naftogaz and the companies owned by Ihor Kolomoyskyi on corporate governance at Ukrnafta are unenforceable, being incoherent with the mandatory provisions of Ukrainian corporate law.

The relevant section of article 9 of the shareholder agreement — stipulating that six members of the Ukrnafta supervisory board are elected from among candidates suggested by Naftogaz while the other five members and CEO from among those suggested by Ukrnafta minority shareholders, i.e. the companies owned by Ihor Kolomoyskyi — cannot thus be enforced. Article 9 also provides that members of the Ukrnafta executive board are approved by the Ukrnafta supervisory board upon submission by the CEO.

The Tribunal, however, declared that the shareholder agreement was valid in general, though its key clauses on corporate governance at Ukrnafta were unenforceable.
 
Corporate Communications Department
NJSC Naftogaz of Ukraine







 

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