Tag Archives: Rosneft

Sechin Says He’ll Testify In Extortion Trial When ‘We Can Agree On A Schedule’

Russian state oil company chief Igor Sechin, who was summoned twice this week to testify in the high-profile extortion trial of a former economy minister but failed to show up, says he will appear when “we can agree on a schedule.”

“As for my participation in court, I will strive to fulfill the requirements of Russian law. But at this stage, my main task is to fulfill my duties as president of Rosneft. As soon as we can agree on the schedule, I will certainly fulfill the necessary conditions,” Sechin was quoted as saying by RBC.ru on November 16.

Continue reading Sechin Says He’ll Testify In Extortion Trial When ‘We Can Agree On A Schedule’

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Exotic locations, alleged bungs, secret recordings and a basket of sausages: Putin’s friend and a no-show in court for Russia’s landmark state oil bribery case

Aleksey Ulyukayev trial over alleged attempt to solicit payment from powerful Rosneft CEO Igor Sechin in exchange for ending opposition to key merger splits Kremlin

The absence of state TV correspondents at the Zamoskvorechye courtroom offered the first clues. Defendant Aleksey Ulyukayev, Russia’s one-time Economics Minister, appeared shortly after 10am local time. But Igor Sechin – the head of state oil behemoth Rosneft, close confidante to the President Vladimir Putin and a key witness in the trial – did not follow him.

Continue reading Exotic locations, alleged bungs, secret recordings and a basket of sausages: Putin’s friend and a no-show in court for Russia’s landmark state oil bribery case

‘They sow chaos wherever they can’: A familiar actor may be behind the massive cyberattack that swept Europe

A colossal cyberattack on Tuesday has been wreaking havoc oncountries and corporations across the globe, and some cybersecurity experts are zeroing in on a familiar name as the possible culprit.

The attack, dubbed “Petya,” is a ransomware worm that has so far targeted, among others, Ukrainian banks and airports; Russian state-owned oil giant Rosneft; British advertising company WPP, US pharmaceutical giant Merck; and shipping company AP Moller-Maersk, which said every branch of its business was affected.

Continue reading ‘They sow chaos wherever they can’: A familiar actor may be behind the massive cyberattack that swept Europe

Global ransomware attack causes turmoil

Companies across the globe are reporting that they have been struck by a major ransomware cyber-attack.

British advertising agency WPP is among those to say its IT systems have been disrupted as a consequence.

Ukrainian firms, including the state power company and Kiev’s main airport, were among the first to report issues.

The Chernobyl nuclear power plant has also had to monitor radiation levels manually after its Windows-based sensors were shut down.

Continue reading Global ransomware attack causes turmoil

Mystery death of ex-KGB chief linked to MI6 spy’s dossier on Donald Trump

An ex-KGB chief suspected of helping the former MI6 spy Christopher Steele to compile his dossier on Donald Trump may have been murdered by the Kremlin and his death covered up. it has been claimed.

Oleg Erovinkin, a former general in the KGB and its successor the FSB, was found dead in the back of his car in Moscow on Boxing Day in mysterious circumstances.

Continue reading Mystery death of ex-KGB chief linked to MI6 spy’s dossier on Donald Trump

Former Yukos shareholders awarded $50bn in damages against Russia

Former leading shareholders of the Yukos oil company have been awarded $50bn in damages against Russia, by far the biggest compensation award ever made in an arbitration case.

The panel in the Permanent Court of Arbitration in The Hague ruled that Russia had destroyed the oil company once headed by jailed oligarch Mikhail Khodorkovsky and expropriated its assets, for political reasons.

“Yukos was the object of a series of politically motivated attacks by the Russian authorities that eventually led to its destruction,” the three-person panel found.

It added that Moscow had aimed to “bankrupt Yukos, assign its assets to a state-controlled company and incarcerate [Mr Khodorkovsky] who gave signs of becoming a political competitor” to Russian president Vladimir Putin.

Former Yukos assets today form the bulk of state-controlled Rosneft, the world’s biggest quoted oil producer, now subject to US sanctions over Russia’s interference in Ukraine.

The ruling in favour of a handful of Russian shareholders and an employee pension fund is set to exacerbate tensions with the west as the US and EU weigh even tougher sanctions against Moscow over its continuing support for separatist rebels in eastern Ukraine.

It will make it difficult for Moscow to sustain its argument that the authorities’ pursuit of Yukos and Mr Khodorkovsky in the middle of the past decade were legitimate actions against fraud and tax evasion by what was then Russia’s biggest oil company.

Mr Khodorkovsky, who served 10 years in jail on fraud charges before being pardoned by Mr Putin last December, said he had learnt of the ruling “with a feeling of satisfaction”.

“From beginning to end, the Yukos case has been an instance of unabashed plundering of a successful company by a mafia with links to the state,” he said.

*RUSSIA OUT* (FILES) Picture taken 04 April 2003 shows Leonid Nevzlin, a key owner of Russia's largest oil company Yukos as he talks to journalists outside the General Office of Public Prosecutor in Moscow. A Moscow court issued an arrest warrant for of one of the top shareholders in the Yukos oil giant on suspicion of murder, the Interfax news agency reported, dealing a new blow to Russia's largest oil producer. Nevzlin, the second largest shareholder in Yukos, who is currently living in exile in Israel, stands accused of ordering the murder of a married couple in 2002, Interfax reported quoting officials at a Moscow district court. AFP PHOTO / VASSILY SHAPOSHNIKOV / KOMMERSANT (Photo credit should read VASSILY SHAPOSHNIKOV/AFP/Getty Images)
Leonid Nevzlin is the biggest beneficiary

Russian shares and the rouble weakened further on Monday morning, extending recent falls prompted by the expectation of tougher sanctions.

Though there is no formal right of appeal, Russia confirmed on Monday it would appeal against the Dutch courts ruling. If the court’s decision is upheld, and Moscow refuses to pay shareholders have the right to pursue Russian state property in other countries through the courts to satisfy the claim.

Rosneft said it did not believe any claim could be brought against the company in connection with the ruling, which it said would not adversely affect its business or assets.

The company was “neither a party nor a participant in these disputes nor a defendant in any published decision”, it said in a statement. Rosneft said it believed that all its acquisitions of former Yukos assets as well as all its other actions in relation to Yukos were legal.

The biggest single beneficiary is the now Israel-based Leonid Nevzlin, a former Yukos vice-president, who owns 70 per cent of GML, the former Yukos holding company that brought the case. Mr Khodorkovsky signed over his Yukos stake to Mr Nevzlin in 2005 during his trial for fraud and tax evasion.

Mr Khodorkovsky reiterated on Monday that he had no further claim over the stake.

Four other Russians – including Platon Lebedev, who was tried and sentenced alongside Mr Khodorkovsky and also pardoned in January – hold the remaining 30 per cent of GML. GML held 60 per cent of Yukos. An employee pension fund that is also party to the litigation owned 10 per cent.

Mikhail Khodorkovsky's co-defendant Platon Lebedev, left, reacts from a court room glass dock, in Moscow, Russia, Wednesday, Dec. 23, 2009. Russia's Supreme Court has ruled that a lower court's 2003 decision to arrest Mikhail Khodorkovsky's business partner Platon Lebedev was illegal on procedural grounds.The review was done in response to a ruling two years ago in the European Court of Human Rights that found Lebedev's rights had been violated during his arrest and pretrial detention. (AP Photo/Mikhail Metzel)
Platon Lebedev and three others hold 30 per cent of GML, the former Yukos holding company

The ruling does not benefit the 55,000 former minority shareholders of Yukos, though it could set a precedent that would help them bring further arbitration cases against Russia.

The European Court of Human Rights is expected on Thursday to issue a damages ruling in a separate case brought by 2004 by Yukos’s then management on behalf of all shareholders.

Mr Khodorkovsky and associates acquired Yukos for a knockdown price in a controversial round of post-communist privatisations in 1995 and built it into Russia’s biggest oil producer. It was the first to embrace western technology and corporate governance standards.

But the oligarch was arrested on corruption charges in 2003 after he became a political threat to Mr Putin. Yukos was pursued by multibillion-dollar back tax claims and penalties and eventually bankrupted.

The three-person arbitration panel backed the claimants’ expropriation claim, brought under the Energy Charter Treaty, which sets rules for cross-border energy co-operation. Russia signed the treaty in 1994 but never ratified it, and withdrew in 2009.

The panel did conclude that “certain facets of [Yukos’s] tax optimisation scheme” had left the main shareholders “vulnerable” to actions by the Russian authorities. It reduced its total putative damages assessment of $67bn by 25 per cent to reflect that.

“This is a mega-litigation”, said Emmanuel Gaillard, head of Shearman & Sterling’s International Arbitration Group, which represented the claimants. He added that he expected Russia ultimately to pay the damages.

“Russia cares about being a powerful international player, and to be an international player it has to respect the rules of the game,” he said.

Analysts said that with international reserves at $470bn, $175bn of which are government reserves, the Russian government had enough cash in its sovereign funds to pay the damages.

“However, this is a significant amount of money – it is equal to around one-ninth of the annual federal budget and 2.5 per cent of GDP. I am sure the government will do its best to resist paying these damages,” said Vladimir Tikhomirov, chief economist at BCS Prime, the Moscow brokerage.

Europe Takes Over Putin TV

Europe Is Seizing Russian State Assets

Assets from state media seized after Kremlin refuses to pay $50 billion in civil damages.

In what is arguably the most significant move against Russian wealth and influence in Europe, Belgium, France and Austria today all froze various assets belonging Russian state-owned enterprises in connection to civil case the Kremlin lost a year ago and for which it has refused to ante up damages.

The winner of that case, Yukos, once Russia’s largest oil company, was awarded $50 billion in July 2014 after an international arbitration court found that it had had its own assets expropriated by the Russian government over a decade ago.

The freeze affects the state wire service TASS, the state media holding company Rossiya Segodnya, and other state media abroad.

“We are working on this issue within the framework of a common government policy,” TASS said in a press statement, refusing to provide more details.

Gazeta.ru learned that court notices about the freeze were received at TASS editorial bureaus in Belgium and France.

Margarita Simonyan, editor-in-chief of Rossiya Segodyna, which publishesRT.com, told Gazeta.ru the situation with her company was similar. “The arrest was place on our account in France,” she said.

“As for the other countries, after the situation in France, the company was concerned to take measures not to allow the halt of our radio and online broadcasting work there.”

Simonyan, however, disputed the account of the freeze given by Russian Forbes, which initially claimed that properties were frozen. She confirmed to Forbes.ruwhat Gazeta.ru also reported, that it was RT’s bank account in France that was frozen, not any property.

Simonyan went a long Twitter tirade today against the magazine, demanding it issue a correction or retraction to its claim. In a press statement, she said that “neither RT nor its subsidiaries own buildings in France…

Furthermore, RT is an autonomous non-commercial organization which is not a Russian state institution. they have not made any claims to RT in this case.”

But Forbes.ru has not changed its story, although it currently contains some quotes from Simonyan, which apparently were added after the piece first broke. She claimed that Russia state media had taken precautions earlier to prevent just such blocking of their broadcasting abroad, although she declined to reveal the details.

Meanwhile, Tim Osborne, the head of Group Menatep Ltd, the holding company for Yukos, confirmed the asset seizures to Forbes:

“According to my information, it’s a question of seizure of a building in which the television channel RT (the former Russia Today) is located in Paris, said Osborne. There are also several buildings in Paris which are the property of the Russian Federation, and that is one of them, he explained. Furthermore, in the event that the television channel does not pay damages to the government, it will also be frozen. Regarding the salary of employees, Osborne explained that the freeze would not affect them since they are employees and not property of the state.”

“[I]n the event that the television channel does not pay damages to the government, it will also be frozen.”

Meanwhile, Andrei Kostin, head of state-controlled VTB Bank, said that a week ago, accounts of Russia companies and diplomatic missions were frozen at his bank’s French subsidiary. The accounts of the missions were then unfrozen in keeping with the Vienna Convention but the rest of the properties were seized.

European authorities have cast a wide net with their determination to freeze Russian assets, and some are arguing that it may be too wide.

Aleksandr Mineyev, Novaya Gazeta‘s correspondent in Brussels, said a process-server came to his door this morning and served him notice that he must report any Russian Federation state property or funds in his possession. He explained that Novaya Gazeta, an independent non-state paper, doesn’t have any Russian state assets.

Attached to the notice was a list of all the other persons served, including Aeroflot, the archbishop of the Russian Orthodox Church in Brussels and the Belgian Orthodox church and other non-governmental media. Diplomatic missions were excluded. The document stated that the court notices were from a Belgian arbitration court regarding the Yukos judgment.

Since the Russian government had not responded to the judgement in more than a year, authorities were freezing Russian assets, the notice said.

Mineyev said many in the list were not Russian organizations, but banks or other institutions such as insurance companies or Eurocontrol, which manages air traffic control in Europe, that might have Russian accounts.

The Belgian court cited a decision from the European Court of Human Rights which demanded that the Russian Federation submit a plan to pay all the sums indicated in its decision and to make the payments no later than June 15, 2015.

Yukos was founded by former political prisoner and businessman Mikhail Khodorkovsky who is today a major critic of Vladimir Putin. Khodorkovsky was arrested in 2003 and convicted of theft and tax evasion in 2005. He ultimately served 10 years in jail before being pardoned by Putin over a year ago.

And while he was not a plaintiff or beneficiary in the arbitration case, he nonetheless welcomed the asset freezes today in a tweet reading, “Happy over the arrests of property of our bureaucracy in Belgium. I expect that the funds recovered will go to projects useful for Russian society.”

Yukos, once worth $40 billion, was broken up and nationalized, with most assets handed to Rosneft, headed by Putin crony Igor Sechin. Rosneft has been placed under E.U. and U.S. sanctions for its role in the Ukrainian war, and Sechin has been additionally sanctioned by the U.S.

(Note: This article is adapted from two posts published at The Interpreter, an online translation and analysis journal sponsored by the Institute of Modern Russia, which Mikhail Khodorkovsky’s son heads.)