The global digital operator Veon has filed two motions with the relevant Kyiv district court challenging the freezing of the corporate rights in its Ukrainian operation Kyivstar.
Noting that corporate rights in Kyivstar belong exclusively to Veon, and that their full or partial seizure directly violates the rights of Veon and its international debt and equity investors, Veon requested the lifting of the freezing of its corporate rights in Kyivstar.
According to Veon, in its filings it also reiterated that any action aimed at the rights, benefits or funds of sanctioned individuals – the alleged reason for seizure of corporate rights as per the SSU (Security Services of Ukraine) statement – cannot legitimately be directed toward Kyivstar or Veon. Sanctioned individuals do not own any shares in Veon or Kyivstar; they cannot exercise any rights regarding Veon or Kyivstar; are not a part of either company’s governance mechanisms, including boards; do not have the ability to control or influence decisions made by Veon or Kyivstar; and do not derive any economic benefits from Veon or any of its operating companies.
Commenting on the development, Kaan Terzioglu, Veon Group CEO, said: “Veon is taking all the necessary steps to protect the rights of our company, our wholly owned subsidiary Kyivstar and our international investors. The impeccable track record of Veon and Kyivstar in serving Ukraine, the dialogue we established last week in Ukraine during our Board delegation’s visit and the continued availability of appeal mechanisms and procedures give me confidence that that we will achieve our dual goal of addressing the concerns of Ukrainian authorities while protecting our rights”.
Veon notes that of the time of publication, neither it nor Kyivstar have officially been served the initial court order seizing corporate rights in Kyivstar, or the amended court order dated 13 October 2023, reducing the percentage of seized corporate rights to 47.85% of the shares. If the motions are rejected, or if the court does not otherwise voluntarily rescind its order, further steps remain available to Veon within the framework of Ukrainian law, including filing an appeal to a higher court.
It adds that as clarified in its October 12 statement, a corporate rights freeze does not amount to asset seizure. The measure prevents changes to ownership and was introduced to protect material evidence while criminal proceedings, unrelated to Kyivstar or Veon, are in progress. As confirmed in the SSU announcement, “The seizure of corporate rights of Ukrainian companies does not affect the protection of the interests of foreign investors and owners of shares of corporate rights, does not hinder their economic activity and the possibility of receiving dividends”.
