Russia could sue Ukraine

Russia could take Ukraine to court in London over a $3 billion (£2 billion) bond that Kiev defaulted on last Friday.

Toppled Ukrainian President Viktor Yanukovych sold the debt to his ally Vladamir Putin in 2013, months before he was ousted in a revolution.

The two sides have been squabbling over the debt ever since, amid border hostilities and Russia annexing Crimea.

Russia refused to take part in an $18 billion (£12 billion) debt restructuring earlier this year and Ukraine defaulted on the debt repayments to Russia on Friday. An earlier International Monetary Fund bailout for Ukraine prohibits much of its cash going towards debt repayments, tying its hands.

Bloomberg notes in a story on Monday that Friday’s defaults makes the prospect of Russia suing Ukraine in London court a “real possibility”.

Here’s Bloomberg:

While there are signs the two sides are willing to reach an out-of-court settlement, a legal battle in the U.K. — either through the court system or arbitration — is a real possibility. Just hours after the moratorium was imposed, Russian Deputy Finance Minister Sergey Storchak reiterated that Moscow will sue, saying Ukraine has “no chance of winning this case.”

Any case would not be bought until the new year and the prospect of us getting a look in is pretty limited. Both sides are said to favour arbitration, which would not be public. They have been communicating through German mediators to try and reach a deal while all this has been going on.

Still, would be interesting to see what London courts would make of Russia v. Ukraine if it does reach the court room.

NOW WATCH: Jim Cramer told us about his ‘vicious’ daily routine which starts at 3:45 AM and doesn’t end until after 11:30 PM

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.