On September 16, 2021, the Northern Commercial Court of Appeal found the deal between Prominvestbank and VR Global Partners L.P. on the purchase of Ukrzaliznytsia’s debts to be illegal.

The court allowed UZ not to repay debts to VR Global

This is reported by the railway magazine Railway Supply with reference to the Press Service of Ukrzaliznytsia.

“The position of the court is quite consistent and is not new, since it is based on the decision of the Grand Chamber of the Supreme Court.

The history of the issue dates back to 2011-2012, when Southern Railway and South-Western Railway signed loan agreements, the funds for which should be returned at the end of 2014 and early 2015, ” the message says.

Ukrzaliznytsia will invite a legal advisor to restructure external debts

In 2019, Ukrzaliznytsia’s debts to Prominvestbank PJSC in the total amount of $ 153,250,000 were sold to VR Global Partners L.P. The deal took place without the participation of UZ representatives, and the company was not even informed about the bank’s intention to sell its debts.

When UZ heard about the sale of its debts, the company stated that it was categorically against any backstage sale of the company’s debt.

Legal proceedings against a private passenger train operator

In accordance with Ukrainian legislation, VR Global Partners L.P. does not have the status of a financial institution, and the debt assignment agreement signed in February 2019 is by nature a factoring agreement that requires the mandatory presence of an appropriate license.

Since VR Global Partners L.P. issued a factoring agreement for a purchase agreement, the court declared the deal with Prominvestbank invalid.

Ukrzaliznytsia also disagreed with the interest to be paid on the debt – from 10 to 11%. In 2019, Prominvestbank sold to the offshore company VR Global Partners (Cayman Islands) Ukrzaliznytsia’s debts for UAH 5 billion with a 30% discount. Several branches of UZ took all these loans from the bank in 2011-2012.

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