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INSIDE TRACK: USSR favoured 'zero option' divorce

Back in the early winter of 1991 the leaders of Russia, Belarus and Ukraine met in a country house and effectively ended the Soviet Union.

Boris Yeltsin, Stanislav Shushkevich and Leonid Kravchuk signed a deal at a hunting lodge in the Belovezhskaya Pushcha national park to wind up the state that, like the UK today, was routinely referred to as "family of nations". Within weeks the red flag had been lowered over the Kremlin and work had begun to disentangle an incredibly complicated single planned economy.

The three men and their counterparts in the other republics -who were left to deal with a fait accompli - had to decide how to divvy up the assets and liabilities of the old state.

The understandings they came to are worth - in my view - a quick look-see for anyone interested in what happens to the pound, the Bank of England and the UK national debt if Scots vote Yes later this month.

Because the Kremlin, despite its deep and complex integration with its fellow republics, opted for what it called the "zero option".

Quickly declared successor state to the old USSR, the Russian Federation decided it would keep all Soviet assets - and all Soviet debts. Russia inherited embassies and billions owed to the old communist regime. It also inherited billions in debt owed by the Soviet Union to western creditors, both private institutions and other states.

Within two years of the Belovezhskaya Pushcha deal, the Russian Federation had replaced its old Soviet banknotes (which were still in circulation as far away as Uzbekistan) with a new ruble. Russia wasn't sharing its currency. It wasn't sharing its assets. And it wasn't sharing its debts. It was quits.

The other republics accepted this clean-slate divorce. Well, nearly all of them: Ukraine isn't sure it got a fair deal. As armour - perhaps Russian armour - chews up the roads in its eastern provinces, the Kiev government still believes it was diddled out of its share of overseas assets, such as embassies. As recently as March this year Ukraine and Russia, which has settled with the USSR's creditors, were still squabbling over the issue.

Right now, Yes and Better Together politicians are setting out what amounts to the starting negotiating positions for independence talks that may never take place. All three Westminster parties refuse to share a currency and a central banking system with an independent Scotland. The SNP has retaliated by saying it won't share liabilities if it can't share assets. This is tantamount to threatening "default", says BT. Is it?

Nobody thinks Latvia, say, defaulted on USSR debt. Would the world feel the same way if post-indyref horse-trading ended in no debt and no pound for Scotland? Probably.

So what are the international norms? Well, there don't seem to be any. The 1978 Vienna Convention on Succession of States in Respect of Treaties distinguished between colonies - who get a clean slate - and seceded regions, such as, potentially, Scotland, which don't. But most states, including the UK, have failed to sign up to this. But would a "zero option" really be best for Scotland?

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