On 2 June 2021, the Economic Court of Kyiv closed the proceedings on the claim filed by the former minority shareholder of PrivatBank Oleksandr Dubilet asking the court to invalidate the PrivatBank purchase agreements that resulted in government obtaining ownership of 100% of PrivatBank’s shares in December 2016. The lawsuit was filed against PrivatBank, Ministry of Finance, and the Deposit Guarantee Fund. The National Bank of Ukraine and Cabinet of Ministers where named as third parties.
“The NBU welcomes the lawful and fully reasoned judgement of the court. When making the decision, the court applied the provisions of Law of Ukraine No. 590–IX On Amendments to Certain Legislative Acts of Ukraine Concerning the Improvement of Banking Regulation Mechanisms that define reimbursement of damages as the only type of remedy available to persons that are or have been participants in a bank”, commented Viktor Hryhorchuk in charge of claim-related work at the NBU Legal Department. “According to the final and transitional provisions of Law No. 590-IX any proceedings in cases filed by a former participant in a bank should be dropped, if the remedies chosen are not in line with the Code of Commercial Procedure of Ukraine”, he said.
Viktor Hryhorchuk also noted that according to Article 41 of the Law of Ukraine On Household Deposit Guarantee System after an agreement to purchase/sell an insolvent bank’s shares had been signed and the shares had been transferred to an investor, the investor (in this case the state acting as an investor) may not be stripped of their ownership of these shares, and these shares may not be recovered from the investor in favor of the former owner.
In December 2019, the former PrivatBank’s CEO Oleksandr Dubilet filed a lawsuit with the Economic Court of Kyiv against PrivatBank, Ministry of Finance, and the Deposit Guarantee Fund, naming the National Bank of Ukraine and Cabinet of Ministers as third parties and asking the court to invalidate the PrivatBank purchase agreements.
The former shareholders and top managers of PrivatBank keep challenging PrivatBank’s nationalization in courts.
The Cabinet of Ministers of Ukraine approved the decision on state participation in the capital of PrivatBank on 18 December 2016.
The state took over PrivatBank in accordance with Article 41.1 of the Law of Ukraine On Households Deposit Guarantee System. This decision helped avoid systemic risks to the banking sector and secured Ukraine’s financial stability.