The Arbitration Court of St. Petersburg and the Leningrad Region ruled in favor of VTB Bank, deciding to hold the Russian bank jointly and severally liable, although initially the dispute involved money stuck in Belgium.
A few years ago, the Russian VTB bank opened an account with the Belgian bank ING Belgique, a subsidiary of the Dutch ING Bank N.V. As of March 10, 2022, 172 thousand euros remained in the account. In February-April 2022, the European Union imposed sanctions on VTB. VTB demanded that ING BELGIQUE transfer the funds, but ING BELGIQUE refused.
After that, VTB appealed to the arbitration court, but the defendants were not only ING Belgique and ING Bank N.V., but also ING Bank, the Russian subsidiary of ING Bank N.V. According to the case file, ING Bank refused to make payments to VTB, citing the lack of formal obligations on the correspondent account with ING Belgique..
However, the arbitration court eventually involved all three, deciding to jointly recover 172,853.19 euros in damages from them.
The Court argued its position, in particular, as follows:
“Between the Defendants… there is a stable property and financial interdependence, expressed in systematic dividend payments in favor of ING Bank N.V., which are often many times higher than the profit of the previous year.”
“The creditworthiness of ING Bank (Eurasia) and ING Belgique is assessed by rating agencies solely based on the support of ING Bank N.V., which confirms their lack of independence as subjects of the financial market.”
“At the same time, the fact that this corporate structure was created before the introduction of the relevant European sanctions has no legal significance. The use of this corporate structure currently under the conditions of the sanctions policy allows ING BELGIQUE to evade its obligations to the plaintiff, violating the fundamental principles of the Russian rule of law.”
The decision of the arbitration court is available at the link
