Legal Highlights: English law in Russian Business.
AAR and BP, TNK-BP and Rosneft
Numerous contracts and agreements in the Russian corporate world include English law provisions. An example of this is the shareholder agreement between BP and the Alfa-Access-Renova consortium, or AAR, covering their Russian oil producing joint venture, TNK-BP. The provisions of this shareholder agreement were central to a dispute between AAR and BP over BP's plans to establish an Arctic oil exploration and development joint venture with Rosneft and to conduct a $16 billion share swap.
The announcement of the joint venture and share swap plans between BP and Rosneft in early January with high-level government encouragement saw AAR seek redress, claiming that its rights under the TNK-BP shareholder agreement were being violated. AAR was granted an interim injunction in English courts, pending the outcome of a London-based Stockholm arbitration process, preventing BP and Rosneft from proceeding. The arbitration panel subsequently determined that the injunction should remain in place indefinitely, with the provisions of the shareholder agreement between BP and AAR over the operation of TNK-BP effectively preventing a tie-up between BP and Rosneft.
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