Gazprom subsidiary must stop Russian lawsuit against UniCredit, UK Supreme Court rules

A subsidiary of Russian energy giant Gazprom was on Tuesday ordered by the UK's Supreme Court to stop suing Italian bank UniCredit in Russia over an aborted gas project. RusKhimAlyans has launched a flurry of lawsuits in the Russian courts after Russia's invasion of Ukraine and subsequent Western sanctions halted work on a liquefied natural gas (LNG) plant at the Baltic port of Ust-Luga in 2022.

A subsidiary of Russian energy giant Gazprom was on Tuesday ordered by the UK's Supreme Court to stop suing Italian bank UniCredit in Russia over an aborted gas project.

RusKhimAlyans has launched a flurry of lawsuits in the Russian courts after Russia's invasion of Ukraine and subsequent Western sanctions halted work on a liquefied natural gas (LNG) plant at the Baltic port of Ust-Luga in 2022. The company which is 50% owned by Gazprom, sued UniCredit for around 450 million euros ($480 million) in August 2023 after the Italian bank refused to pay bank guarantees linked to the project, citing Western sanctions.

UniCredit obtained an anti-suit injunction in London, preventing RusKhimAlyans from pursuing its case in Russia, on the grounds the parties' contract said they would take any disputes to arbitration in France. RusKhimAlyans tried to overturn that decision at the UK's Supreme Court last week, but its appeal was dismissed on Tuesday, Judge Robert Reed announced.

RusKhimAlyans and UniCredit did not immediately respond to requests for comment. Tuesday's decision comes days after

Reuters reported that the European Central Bank is poised to order UniCredit to cut back its business with Russia, as European regulators increase the pressure on its lenders.

Leading governance adviser Glass Lewis also warned

earlier this month that UniCredit's ongoing presence in Russia exposes the bank to reputational risks. Lawyers representing UniCredit, in court filings for last week's hearing, said the lender faced "direct commercial consequences" if RusKhimAlyans' Russian case continued.

"If the English court cannot act, (RusKhimAlyans) will soon be granted a final merits judgment of c.450 million euros and then seek to execute against UniCredit's exposed assets in Russia," UniCredit's lawyer Stephen Houseman said.

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