Arricano Real Estate Plc VS Stockman Interhold S.A.: On November 30, 2017, the High Court of Justice in London Ruled in Favor of Arricano in Sky Mall Case
Stolen from the foreign investor five years ago, the shopping mall Sky Mall must be returned to its lawful owner - Arricano. The High Court of Justice (London, England) has put an end to the lengthy dispute between the European shareholders and the Ukrainian partner. No implementation of that decision is possible without holding liable the corrupt representatives of the Ukrainian authorities who assisted in the theft of Sky Mall and its transfer to “third parties”, thus depriving the European investor of all income from the property operation. Having exhausted all legal possibilities to return the asset and protect its rights in Ukraine, Arricano had to fight its corner before international independent judicial authorities.
Numerous company’s requests addressed to the Ukrainian law enforcement bodies and officials for help and support in the protection of its rights to the asset, is an example of a consistent effort against corruption in the upper echelons of power.
For a long period of time, the conflict over Sky Mall was among the most publicized and negative cases demonstrating, in particular, the imperfection of the legislative, judicial, and executive systems in Ukraine. The corporate rights of the company that owned Sky Mall were illegally transferred by the Ukrainian partners in Sky Mall to the benefit shell and “not related” companies through re-registration of title regardless of the existing injunctions and effective decisions of Ukrainian courts and the ongoing arbitration proceedings in London. Thereby, as a result of wrongful judgments and active steps of some corrupt officers of law enforcement bodies, instructed by representatives of Stockman Interhold SA, Arricano, being in the process of struggle for the asset, was actually deprived of participation in Sky Mall management, which later on resulted in the illegal disposal of the asset itself, the loans, and corporate rights for the company that owned Sky Mall.
Since 2006, Arricano Real Estate Plc invested over USD 420 million in construction of modern shopping malls in Ukraine out of the overall investment program of more than USD 705 million. Arricano believe that the way of attracting the direct foreign investments in Ukraine, as declared by the state, will remain impracticable until the cases similar to the Sky Mall case and violation of investors’ rights occur. Execution of the awards of the London Court of International Arbitration in Ukraine may soon establish a precedent displaying the country’s investment attractiveness for foreign financing.
On November 30, 2017, the Commercial Court of the Queen’s Bench Division of the High Court of Justice announced its judgement in the arbitration between Arricano Real Estate Plc and Stockman Interhold S.A. over the title to the shares in Assofit Holdings Limited, a holding company, that previously fully owned the shopping mall Sky Mall (located in Kyiv, Ukraine). By this judgement, all appeals of Stockman Interhold S.A. against three out of eight awards of the LCIA awards were dismissed. The LCIA’s jurisdiction and lawfulness of the awards were also confirmed. In particular, the court affirmed the Seventh LCIA Award of May 5, 2016 confirming the obligation of Stockman Interhold S.A. to transfer to Arricano Real Estate Plc the shares in the holding company Assofit Holdings Limited (that previously owned Sky Mall) at a price equal to USD 0.00.
As at the date of the decision made by the High Court of Justice, the shares in Assofit Holdings Limited were not transferred, as was ordered in the above LCIA Award of May 5, 2016, and Sky Mall was not returned to Arricano.