A French court of appeal has ordered the lifting of a freeze on Russian diplomatic bank accounts, which were blocked in May at the request of a Swiss-based trading company.

An appeal judge ruled that the Russian accounts were covered by diplomatic immunity. Lawyers for the Swiss-based company, Noga, had argued that Moscow renounced all immunity in disputed oil-for-food contracts drawn up in 1991 and 1992.

Noga had managed to force a freeze on the accounts of the Russian embassy, its commercial representatives, and those of the Russian mission to the United Nations cultural body, Unesco.

Noga was ordered to pay over $4,000 (SFr6,800) in costs to Russia. Its lawyers said they would now be taking the case to a higher court.

It is seeking $63 million in back payments for the oil-for-food contracts.

The accounts hold only about $400,000, but the freeze apparently caused major cash flow problems for the embassy, with certain diplomatic events having to be called off.

At one stage, the Russian sailing ship, the "Sedov" was impounded, as the row continued.

Analysts say the case strained relations between Russia and France, and that both countries will be relieved that the problem has been eased before the Russian president, Vladimir Putin, visits France in October.

swissinfo and agencies

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