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. Last Updated: 07/27/2016

New Hearings Ordered in PwC's Tax Evasion Case

Moscow's Higher Arbitration Court on Tuesday ordered a new round of hearings into charges that PricewaterhouseCoopers' Russian unit evaded millions of dollars in taxes.

The victory for PwC came less than two weeks after the auditing firm withdrew its entire audit series for Yukos, saying a new investigation by the Prosecutor General's Office showed the company did not properly disclose its relation to certain oil trading firms.

"We are pleased that the Higher Arbitration Court did not support previous court decisions, and we will continue to defend our position in the court of first instance," a PwC spokeswoman said, requesting anonymity in line with company policy.

A Moscow arbitration court will re-examine the charges, but a date has not been set, she added.

The company had appealed a conviction that it had failed to pay 243 million rubles ($9.4 million) in taxes by falsely declaring its hiring of non-Russians and inaccurately reporting auditing services for nonresidents.

The final appeals court upheld the argument that PwC evaded paying 8 million rubles ($313,000) worth of taxes for its auditing services, the spokeswoman said. Yet it sent back to the lower courts a conviction for having underpaid taxes on its expatriate hires.

Lawyers for jailed Yukos chief Mikhail Khodorkovsky and main shareholder Platon Lebedev have accused PwC of caving into legal pressure in deciding to withdraw the audits they conducted of Yukos from 1995 to 2004.

Khodorkovsky and Lebedev, already serving eight-year sentences on charges of fraud and tax evasion, are awaiting a fresh trial on embezzlement and money-laundering charges.

Yukos' London-based former managers are also waging court battles in the Netherlands and Strasbourg, France, in relation to the bankrupt company's international assets.

In a separate case in March, a court found PwC guilty of violating professional standards for the Yukos audits it carried out from 2002 to 2004. It is due to appeal that decision July 17.