The Arbitration Court of St. Petersburg and Leningrad Oblast ruled on a claim by the shipbuilding company, Severnaya Verft (The Northern Shipyard), which demanded 3.8 million euros from Finnish Wärtsilä Solutions Oy.
In 2020, the companies signed a contract for the supply of four sets of ship equipment for four 170701-project ships. The total value of the contract was €16 million. Project 17707 is a freezing trawler project; orders for such vessels were received by Severna Verft from Norebo, a fishing group.
Wärtsila Solutions supplied only the first set fully, as Russia deployed troops in Ukraine, after which the EU imposed a public ban on transactions with Russian organizations. Severnaya Verf proposed to terminate the contract as of May 22, 2022 and return the advance payment of 3.831.383 euros. However, the Finnish company was unable to do so due to EU sanctions. Furthermore, the contract stated that any disputes between the companies should be settled by the Arbitration Court of the Stockholm Chamber of Commerce.
Severnaya Verf decided to settle the dispute in a court in St. Petersburg and the Leningrad Region.
The Russian court concluded that “considering the dispute on Swedish territory… and executing the decision on EU territory… in light of the indefinite nature of direct public law restrictions and prohibitions imposed by EU authorities and member states… would prevent a fair and unbiased consideration of the case.”
As a result, the court has decided to recover €3,831,383 from Wartsila Solutions Oy for the public JSC Shipbuilding Plant Severnaya Verf. However, it is unclear how this decision will be implemented since no one has lifted EU sanctions.
The official website of the Northern Shipyard says that the main activities of the enterprise are the construction of combat surface ships of the corvette, frigate, destroyer classes, special purpose ships, support vessels of the Russian Navy.
