Russian assets in France seized

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Russia’s refusal to pay damages in a court case has forced France to seize $700 million owed to Russia’s aerospace industry.

In total, France has seized Russian assets worth $1 billion following the Kremlin’s refusal to pay damages to former Yukos shareholders.

In July 2014, The Hague international arbitration court ruled that Russia must pay $50 billion for expropriating the assets of Yukos. The seized assets include $400 million owed by French-based satellite provider Eutelsat to the Russian Satellite Communications company and $300 million owned by French space launch provider Arianespace to Russia’s Roscosmos space agency, the magazine reported, citing the Shearman & Sterling legal firm which represents the Yukos shareholders.

This story is similar to the Sea Launch court suit by Boeing, whom the Russians owe $300 million. In that case Boeing has moved to block Russia from selling Sea Launch.

Both stories suggest that the Russians are in big financial trouble, partly caused by a lack of understanding of capitalism. In both cases, they formed partnerships with western businesses and failed to realize that those partnerships placed financial obligations upon them. From its Soviet days Russia probably thought they could ignore those obligations if it became inconvenient, and they are now discovering that this is not really possible if they wish to sell their goods to the rest of the world.

I expect Russia’s space industry to increasingly become isolated from the rest of the world market, partly because of these events.

In related news, Roscosmos has revealed that after the initial launch at Vostochny in April, the second launch will not occur until 2017. This indicates that the first launch is merely a face-saving effort to hide the fact that construction is really more than a year behind schedule, not three months.



  • mike shupp

    This indicates that the first launch is merely a face-saving effort . . .

    Only someone evial, depraved, tasteless, cynical, and generally lacking in compassion would call to mind the proposed 2018 launch date for the first SLS.

  • Edward

    If Vostochny is not fully completed and the next launch will not be until it is more complete, then perhaps the Russians fear that launching from an incomplete facility adds risk to the launch. This would explain why they have insured the first launch.

    Since France is seizing funds that are owed to Russian space companies, there could be a further setback for Russia’s decadal plan.

    Indeed, if the Russian ten-year plan is to spend $20 Billion, and they owe French companies “$50 billion for expropriating the assets of Yukos,” then the Russian space program may be in deep trouble.

    “How’s that consolidation working out for ya?” as Robert asked in my second, “Roscosmos budget slashed,” link. It seems to me that the consolidation left Russia with decision makers who have already made very, very bad decisions.

    Even the Sea Launch article tells us that the Russians (Energia) expected that they did not have to pay the owed $300 million. It looks to me like the Russian planners and decision makers expect to get “free rides” from the rest of the world.

  • Heh. Shall I, or do you want to do it?

    I am also reminded of the first Ares 1 launch.

  • D K Rögnvald Williams

    The Putinistas have made a fine mess of things.

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