The Odessa city council has gone for an amicable settlement with Odessa Airport Development LLC, the investor in the Odessa airport, despite previously asking a court to declare its contract with the company null and void. In connection with this, the Odessa Economic Court of Appeal has decided to cancel the Odessa Regional Economic Court’s decision of 13 July 2015 and terminate the court proceedings, according to avianews.com.
Thus, the investor may continue to operate the airport under the existing terms, according to which it owns 75% of the joint venture that operates the airport and the Odessa city council owns 25%.
The joint venture that operates the airport was created in 2011. At the time, the Odessa city council contributed the assets of the municipal airport to the statutory capital of the new company and received 25% of the shares in the new company in accordance with the contract. Odessa Airport Development LLC, which is linked to businessman Borys Kaufman, pledged to invest in the airport’s infrastructure and received 75% of the shares.
In November 2014, the city council went to court to attempt to invalidate the contract’s provisions relating to the transfer of municipal assets to the joint venture, but it lost in two court instances.
On 14 April 2015, the Higher Economic Court reversed the court decisions and sent the case to the court of first instance for retrial. On 13 July, the Odessa Regional Economic Court made a decision that both sides interpreted in their favor. The court invalidated some provisions of the contract between the city council and the company as well as individual sections of the charter of the Odessa Airport Development LLC. These sections of the charter relate to the transfer of municipal property as a share in the statutory capital of the company, and the court’s decision essentially returned the airport building to the municipal authorities.
At the same time, the court rejected the city council's request to invalidate the provisions of the contract regarding the principles of corporate management of the Odessa International Airport, which outlines the procedure for interaction between the city council and Odessa Airport Development LLC.
As reported, the construction of the airport’s new terminal that began in 2012 accelerated only in the summer of 2015, when the Odessa region’s Governor Mikheil Saakashvili issued an ultimatum to the investor in the airport.