Court says Siemens–Rostec suit could have hurt Russia’s sovereignty

MOSCOW, Jan 19 (PRIME) -- Satisfaction of a suit filed by Siemens Gas Turbine Technologies, a Russian subsidiary of Germany’s Siemens, against companies of state industrial corporation Rostec over four Crimean turbines could have hurt Russia’s sovereignty, the Moscow Arbitration Court said in a statement on Friday.

“The major consequence from satisfaction of the claims of the claimant would be a legal application of economic sanctions introduced by the European Union on the territory of Russia in the form of court acknowledgement that Russian legal entities, which acted as the claimant and the defendants under the case, have to comply with them, which would have contradicted the public order of the Russian Federation and hurt sovereignty of the state,” the court said.

The claimant did not provide any proof that defendants deliberately created a wrong idea about conditions of the gas turbine deal. “Further signing of a contract that implies no encumbrance in operation of the gas turbine units by the defendants is not a proof of it,” the court said.

The claimant also had no impairment of material assets as the defendants fulfilled the contract and paid in full.

Siemens said in July 2017 that all the four turbines meant to be used on a Russian power plant on the Taman Peninsula were illegally shipped to Crimea, forcing it to cancel its licensing agreements to sell power equipment to Russian firms and suspend the current agreements with state-run companies. Later Siemens and its Russian affiliate filed claims against Rostec’s companies JSC Technopromexport and LLC Technopromexport seeking to void a delivery contract.

The sum of the deal is unknown. According to earlier reports, Rostec’s affiliate JSC Technopromexport resold the equipment to LLC Technopromexport for 152.4 million euros.

In late 2017, the court turned down Siemens’ suit and brought the company to proceedings over the suit filed by its subsidiary against the same companies. On January 10, the court dismissed the claim of the subsidiary.

Siemens’ representative Wolfram Trost told PRIME on January 11 that the company still plans to take all the steps necessary to protect its interests.

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