Contract Law and Ukraine's $3 Billion Debt to Russia

Forthcoming, Capital Markets Law Journal

UNC Legal Studies Research Paper No. 2725178

7 Pages Posted: 1 Feb 2016 Last revised: 17 Feb 2016

Mark C. Weidemaier

University of North Carolina (UNC) at Chapel Hill - School of Law

Date Written: January 30, 2016

Abstract

Russia has announced that it will initiate proceedings by the end of January (likely in arbitration) to recover the $3 billion debt owed by Ukraine. The Russia-Ukraine dispute is unique in the annals of sovereign debt litigation. It is a politically and militarily fraught conflict wrapped in a garden-variety, English-law contract dispute. The dispute may settle, and if so its resolution will depend largely on political and economic considerations. Yet the resolution will occur in the shadow of basic contract law, which is surprisingly relevant. Indeed, there are a number of plausible arguments available to Ukraine, which, despite the unusual facts, may excuse (or allow it to defer) its obligations to Russia. It would be understandable for judges and arbitrators to hesitate before weighing in on such a politically-charged dispute, but Russia’s insistence on acting like a private creditor leaves little choice.

Keywords: Ukraine, sovereign debt, contracts

Suggested Citation

Weidemaier, Mark C., Contract Law and Ukraine's $3 Billion Debt to Russia (January 30, 2016). Forthcoming, Capital Markets Law Journal; UNC Legal Studies Research Paper No. 2725178. Available at SSRN: https://ssrn.com/abstract=2725178 or http://dx.doi.org/10.2139/ssrn.2725178

Mark C. Weidemaier (Contact Author)

University of North Carolina (UNC) at Chapel Hill - School of Law ( email )

Van Hecke-Wettach Hall, 160 Ridge Road
CB #3380
Chapel Hill, NC 27599-3380
United States
919.843.4373 (Phone)

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