June 18, 2015 / 5:59 PM / 2 years ago

Russia examines Brussels' legal move to seize state assets

MOSCOW (Reuters) - The Kremlin said on Thursday it was carefully examining moves to seize Russian state property in Belgium to cover a court settlement compensating shareholders in now defunct oil company Yukos.

One Russian government minister said such moves would be unfriendly and another said they would be illegal.

An international arbitration court ruled last July that Russia must pay $50 billion for expropriating the assets of Yukos, once Russia's biggest oil producer and run by Mikhail Khodorkovsky, a businessman who used to be Russia's richest man but fell out with the Kremlin.

The GML group of former shareholders who made the claim said then it would be hard to get Moscow to pay, so it started "recognition proceedings" in Britain, the United States, Belgium and France to enforce the decision in their capitals.

In Belgium and France that means that GML "can attach assets of the Russian government to safeguard the ultimate award", said Tim Osborne, director of the GML group, in a move which forces local courts to freeze Russian state assets, possibly for years.

"Russia has made no effort to contact us to try and discuss (the $50 billion award) and has made it very clear that they are not going to pay it, so we are left with no choice but to enforce it," he told Reuters.

"It will take a number of years, we always knew it would ... but we've got the stamina and budget to do it," he said. "The assets frozen in Belgium and France will be assets directly owned by the Russian Federation – primarily bank accounts and, possibly, real estate."

Russia's Interfax news agency said a Belgian arbitration court had ruled in favor of a group of former shareholders about seizing Russian state property worth 1.65 billion euros ($1.9 billion) in Belgium.

Several dozen companies in Belgium had been told to provide information on whether they own any Russian state assets, Interfax and other local media said.

It was not clear whether anything had yet been seized and Belgian bailiffs Sacre and De Smet declined to comment. The French Finance Ministry also declined comment.

The head of a subsidiary of Russian bank VTB, Mikhail Zadornov, told Rossiya-24 television that the accounts of Russian companies and its diplomatic mission had been frozen at the bank's French subsidiary on Wednesday. He added that the diplomatic accounts were unblocked.

Kremlin spokesman Dmitry Peskov said the government and its lawyers would look into the matter.

"We are now in the most careful manner examining all circumstances of the claim," he said.

A Kremlin aide, Andrei Belousov, said the court's decision contained a number of violations.

"We are concerned. We expect a number of countries to take similar measures," he told reporters at an economic conference in St Petersburg.

Economy Minister Alexei Ulyukayev called the move unlawful and Finance Minister Anton Siluanov said Russia had filed a counter-claim over the international arbitration court's ruling.

"We consider such actions now (seizing assets) unfriendly," he said at the economic conference in St Petersburg.

Yukos' former shareholders had celebrated the award made by the court in The Hague, which ruled that the Russian authorities had subjected Yukos to politically motivated attacks when it was broken up and nationalized, with most assets handed to Russian oil producer Rosneft.

Khodorkovsky was arrested at gunpoint in 2003 and convicted of theft and tax evasion in 2005, seen by many critics as punishment for opposing Putin though the Kremlin denies this.

On Twitter, Khodorkovsky, who now lives in exile and is critical of the government, welcomed the move.

"I expect that the money will be spent on projects that will benefit Russian society," he said.

($1 = 0.8776 euros)

Reporting by Elizabeth Piper, Denis Dyomkin, Darya Korsunskaya, Gabriela Baczynska, Katya Golubkova in St Petersburg and Moscow, and Alexander Saeedy in Brussels, editing by Timothy Heritage and Angus MacSwan

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