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Russia court upholds sale of Yukos production arm

[JURIST] A Russian court on Friday upheld the 2004 sale [JURIST report] of the top production unit of now-bankrupt oil company Yukos [JURIST news archive]. Yuganskneftegaz [corporate backgrounder] was auctioned off after Yukos was held liable for over $20 billion in back taxes [JURIST report]. Yukos sued in 2005 to challenge the sale of Yuganskneftegaz, which is now controlled [JURIST report] by the Russian state oil company Rosneft, arguing that the auction violated Russian and international law and that the Russian Federal Property Management Fund [AK&M backgrounder] purposefully underestimated the unit's value. The arbitration court in Moscow rejected Yukos' motion to overturn the sale.

Former Yukos CEO Mikhael Khodorkovsky [defense website; JURIST news archive] was convicted of tax evasion [JURIST report] in 2005 and is currently serving an eight-year prison sentence. Russian prosecutors earlier this month filed new money laundering charges [JURIST report] based on allegations that Khodorkovsky used his Open Russia Foundation [SourceWatch backgrounder] to funnel oil revenues away from Yukos. RIA Novosti has more.

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