Lawyers fail to halt Yukos trial

A Moscow court has refused a request for the trial of Russian oil tycoon Mikhail Khodorkovsky to be postponed.

Defence lawyers had filed for the trial, which restarted on Monday, to be delayed because of the ill health of the co-defendant Platon Lebedev.

The former boss of Yukos and his key business ally are facing charges of fraud, embezzlement and tax evasion.

Resumption of the trial comes days after Yukos failed to pay a $3.4bn (£1.8bn; 2.7bn euros) tax bill.

After the deadline passed last week for Yukos to settle the bill, bailiffs seized computer equipment and froze the company's bank accounts.

Both Yukos and Mr Khodorkovsky, who had earlier been led into court handcuffed to a prison guard, are said to be seeking a deal with the government.

Mr Khodorkovsky has offered to sign over his stake in Yukos to the government but the authorities have shown no interest publicly in pursuing this.

Politically driven

A lawyer for Mr Lebedev told the court that the case against his client should be halted because he was too ill with a liver complaint for it to continue.

"He is critically ill. He can barely stand up... it's really incredible that in the 21st century in Russia this is going on," said lawyer Robert Amsterdam.

The court declined both this request and another for Mr Lebedev to be removed from jail.

Many observers, and Yukos supporters outside the court building on Monday, see the trial of the two men and tax demand on the company as being politically motivated.

They believe the men and company are being punished by the Kremlin after Mr Khodorkovsky started to fund President Putin's political rivals.

Mr Khodorkovsky was arrested in October 2003 when armed members of the Russian security police force FSB stormed his private jet at an airport in Siberia.

He has been detained ever since, and the trial has been going on since 16 June.

Tax loopholes

Monday's hearing might end in a further adjournment in a trial that looks set to continue for some time, observers say.

Yukos's $3.4bn bill applies to 2000, when Russian authorities claim it misused tax havens to reduce its tax burden.

The oil giant denies any wrongdoing, claiming instead that the practice was legal at the time.

Yukos has received a demand for a similar amount for the 2001 tax year and the authorities have suggested bills for the following two years might also be presented.

The company says it is unable to pay the bills because its assets have been frozen by court order and it could, consequently, be forced to declare bankruptcy.

President Putin has said he is not seeking to bankrupt Yukos; the company is seeking a deal with the authorities under which it would be given a breathing space in which to settle the bills.

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