MOSCOW, February 9 (RAPSI) – Russian Federation has asked the District Court of the Hague to admit that a lower court lacked competence to review dispute between former shareholders of Yukos and Russia, RIA Novosti reported on Tuesday.

The District Court of the Hague is hearing an appeal by Russian Federation against the ruling of the Hague Permanent Court of Arbitration which granted ex-shareholders of Yukos over $50 billion.

Russia believes that the lower court had no right to review the case because the Energy Charter Treaty, which was appealed to during the review of a case, has never been ratified by Russian Parliament. Albert Jan van den Berg, a lawyer who is representing Russia in this case, said that Russian Federation undoubtedly signed the Charter but is not obligated by a contract.

Russian Federation has also claimed that shares of former Yukos co-owners can’t be regarded as investments under jurisdiction of the Energy Charter Treaty. According to representatives of Russia, companies behind the investments have been registered in other countries, but in reality they’ve been front companies created in violation of Russian legislation, therefore the dispute is to be heard in a Russian court.

Additionally, Russian Federation believes that the Hague Permanent Court of Arbitration has made several judicial mistakes: it has not consulted tax authorities of Russia, Cyprus and Great Britain during the review of the case and has used flawed methodology to calculate the losses of Yukos ex-shareholders.

The Energy Charter Treaty establishes a complex system of rules regulating cooperation in energy sphere between signing parties. Russia signed the Treaty in 1994 but did not ratify it, maintaining nation legislation.

A tribunal for the Hague Permanent Court of Arbitration announced in July 2014 that it had issued awards in three cases filed against Russia. The tribunal ordered that Russia pay Yukos Universal Limited (Isle of Man) over $1.8 billion in damages. Hulley Enterprises Limited (Cyprus) was awarded about $40 billion, and Veteran Petroleum Limited (Cyprus) got over $8 billion. Russian authorities moved to set aside the ruling and turned to the District Court of the Hague.