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Last Updated: Tuesday, 19 September 2006, 14:00 GMT 15:00 UK
Yukos loses its bankruptcy appeal
Security guard outside Yukos headquarters
Yukos has lost its fight for survival
A Moscow arbitration court has thrown out an appeal by Russian oil firm Yukos against it being declared bankrupt.

Yukos was challenging a decision made last month that cleared the way for the firm to be liquidated.

The decision followed a three-year court battle for survival, after Yukos was hit with a huge back tax bill.

The saga has seen former Yukos chief Mikhail Khodorkovsky jailed and parts of the oil firm's empire sold off with rivals keen to buy assets.

Struggle

Yukos' principal shareholders filed for bankruptcy, rejecting assurances from management that it could remain in business and pay the $17bn (9bn) it owes to creditors.

Yukos says the tax demands were linked to a political campaign against its founder, Mr Khodorkovsky, who is currently serving a long prison sentence in Siberia.

In 2004, the back tax bill led to Yukos' main Yuganskneftegaz subsidiary being expropriated by the government and sold off at auction. It was ultimately acquired by state-owned oil company Rosneft.

The sale led to a legal challenge from Yukos when Rosneft floated on the London Stock Exchange.

Yukos spokeswoman Claire Davidson said that given the company's lack of success in the Russian courts, the news that its appeal had been rejected was "expected".


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