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| Yukos has a long wait ahead to hear if it will
get US protection |
Yukos has said a US bankruptcy court will decide whether to block
Russia's impending auction of its main production arm on Thursday.
The Russian oil firm has filed for bankruptcy protection in the US in
an attempt to halt the forced sale.
However, Judge Letitia Clark said the hearing would continue on
Thursday when arguments in the case would be heard.
Russian authorities are due to auction off Yuganskneftegas on 19
December to pay a huge tax bill sent to Yukos.
Russian prosecutors are forcing the sale of the firm's most lucrative
asset Yuganskneftegas to help pay a $27bn (￡14bn) back tax bill, which
they claim is owed by Yukos.
Filing for bankruptcy protection in the US was "a last resort to
preserve the rights of our shareholders, employees and customers," said
Yukos chief executive Steven Theede.
The company added it had opted to take action through American courts
as US bankruptcy law gives worldwide jurisdiction over a debtor company's
property and because it was seeking a judiciary willing to protect the
value of shareholders' investments.
However, as the firm is based in Russia and has no significant US
assets, lawyers are unsure of the outcome of the case.
"We are here to stop 60% of our body from being cut off on Sunday,"
Zack Clement, a lawyer for Yukos, told Judge Clark in an emergency hearing
in Houston, Texas, on Wednesday.
As well as the bid to get Chapter 11 bankruptcy - which protects firms
from creditors, allowing them to continue trading as they restructure
their finances - the group also made a claim for damages against the
Russian government.
Yukos asked the Houston court to order Russia to
arbitration so that it
can press claims for billions of dollars in damages over a "campaign of
illegal, discriminatory and disproportionate" tax claims.
Mr Clement said that Russian law obligated the Russian government to
enter into arbitration as set out in international law.
He added that the opening bid for the firm's Yuganskneftgaz unit was
$8bn - less than half of the $20m it is worth.
"We believe the only significant bidder at the auction on Sunday is
Gazprom," he said, referring to Russia's natural gas giant.
Yukos maintains that the forced auction is illegal and "will cause the
company to suffer immediate and irreparable harm."
Many commentators believe the Russian government's aggressive pursuit
of Yukos is a politically-motivated response to the political ambitions of
its former chief executive, Mikhail Khodorkovsky.
Mr Khodorkovsky, who had funded liberal opposition groups, was arrested
in October last year on fraud and tax evasion charges and is still in jail
Analysts believe that if its production unit is auctioned off it is
likely to be bought up by a government-backed firm, like Gazprom,
effectively bringing a large chunk of Russia's lucrative oil and gas
industry back under state control.
(Agencies) | 
Updated: 2004-12-16 11:19