By John Helmer, Moscow

By releasing on bail all but one of thirty Greenpeace protesters charged for an attack on the offshore Russian oil platform Prirazlomnaya in September, Russian prosecutors and a St. Petersburg court have pre-empted and defeated Greenpeace and the Dutch Government.

Greenpeace and the Dutch had applied for “provisional measures” from the International Tribunal for the Law of the Sea (ITLOS) in Hamburg. Their demand was for the release from arrest and prison, and for permission to leave Russia altogether, for the 30 protesters, including three of them who are Russian citizens. The demand also included the release of the Arctic Sunrise, the converted icebreaker which Greenpeace has been operating this year in the Barents Sea and Pechora Sea, above the Arctic Circle. The Russian government has preempted the vessel release by issuing guarantees of the state icebreaker fleet company which owns the berth at which the Arctic Sunrise is moored; and of the Coast Guard division of the Federal Security Service (FSB), which is guarding it.
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by John Helmer - Monday, November 25th, 2013
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By John Helmer, Moscow

Russia’s state-owned tanker company Sovcomflot has reported third-quarter and nine-month financial results showing that it continues to lose fleet operating revenues and run at a loss. In the nine months to September 30, the company says its time-charter equivalent (TCE) revenues were $657.2 million, down 1.6% on the same period of last year. Fleet operating costs were up by 7% to $284 million, primarily because of a jump in charter hire payments. On the bottom line, Sovcomflot says it ran a 9-month loss of $8.6 million; a year ago it was in the black at $42.5 million.
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by John Helmer - Friday, November 22nd, 2013
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By John Helmer, Moscow

Oleg Deripaska’s (image right) associates inside Rusal say the company is so short of cash, the chief executive has no alternative but to squeeze the President of Tajikistan, Emomali Rahmon (left), and threaten to publish details of his offshore bank accounts, unless he comes across with almost $350 million. But Rahmon, Deripaska’s partner in a highly profitable metal trading scheme between 2004 and 2008, is sitting on a military card which may yet oblige President Vladimir Putin to tell Deripaska to back off. That card is Russia’s military base and arms agreement with Tajikistan, which waits for final ratification at the moment. Coincidentally, the Russian Ministry of Defense is promising to invest an almost identical sum if Rahmon agrees to terms.

Rusal has issued two recent announcements after Swiss arbitration tribunals ruled in its favour and issued awards amounting to at least $350 million; more as the interest accumulates while Rahmon and the Tajikistan Aluminium Company (Talco; aka Tajikistan Aluminium Combine, TadAZ) delays payment. The first of these was the Swiss ruling of October 9, 2013, which Rusal reported this way. “The tribunal granted in full Hamer’s claim that TalCo was in breach of two barter agreements concluded in 2003 under which Hamer supplied TalCo with certain raw materials, and ordered TalCo to pay Hamer damages of US$112,745,501, interest of approximately US$147 million, and costs, fees and expenses of the arbitration proceedings in the amount of US$14,579,385, for a total of approximately US$275 million plus post-award interest. The tribunal also denied in full TalCo’s amended counterclaims in the amount of almost US$400 million (exclusive of interest), which were based on TalCo’s assertions that the said contracts had been procured by corruption. The tribunal rejected such allegations.”
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by John Helmer - Thursday, November 21st, 2013
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By John Helmer, Moscow

While the Greenpeace organization has been drawing worldwide attention to pending charges of a pirate attack against the Prirazlomnaya oil platform in the Barents Sea, Russian prosecutors and the Russian Navy reveal they have abandoned the prosecution of piracy threatening Russian vessels in the Indian Ocean off the Horn of Africa.

Article 227 of the Russian Criminal Code defines piracy as an “assault on a seagoing ship or a river boat with the aim of capturing other people’s property, committed with the use of violence or with the threat of its use”. The penalty for a conviction on one count is prison for between five and ten years. Repeated acts of the same type “with the use of arms or objects used as arms”, according to section 2, draws a penalty of 8 to 12 years. If pirate acts are organized by groups the sentence grows from 10 to 15 years.
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by John Helmer - Tuesday, November 19th, 2013
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By John Helmer, Moscow

The sharp selloff of Mechel, the steel and coal group controlled by Igor Zyuzin, ought to demonstrate — if fresh proof were needed — that this is no longer a commercial operation in the normal sense of the term. Today Mechel is a nationalized enterprise kept solvent by five state banks in order to preserve the economies of several cities and regions across the country.

The stock market gyrations this week, in which almost $330 million in market capitalization was liquidated, should also demonstrate – if that too were necessary – how little a Russian company listing on the New York Stock Exchange provides by way of accountable financial reporting or effective regulation by the US Securities and Exchange Commission (SEC).
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by John Helmer - Friday, November 15th, 2013
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By John Helmer, Moscow

According to United Company Rusal, the Russian state aluminium monopoly, it is one of the most transparent multinational corporations in the world – that’s to say, in the emerging markets of the world, and across sixteen countries. A report of Berlin-based Transparency International (TI), issued on October 16, has ranked Rusal sixth on several measures, with a perfect 100% score on what TI calls “organizational transparency”. The other perfect scorers were Emirates Airlines (UAE), Johnson Electric (Hong Kong), Petronas (Brazil), and Shanghai Electric Group.

As for what organizational transparency means to TI and how it scored Rusal and the others, TI says it asked these eight questions as part of a larger questionnaire:
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by John Helmer - Wednesday, November 13th, 2013
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By John Helmer, Moscow

Three hundred and ninety years ago the Dutch water-boarded and then executed a group of British merchants on the trumped-up allegation of plotting to seize the Dutch fortress on the island of Ambon, now part of Indonesia where it is called Maluku. Remember the Amboyna Massacre! became fighting talk in London for fifty years, leading to a decade of litigation in The Netherlands, and ultimately to the first Anglo-Dutch War of 1652-54 The British won that one – and also the second war of 1655-57, and the third war of 1672-74.

The real reason for the massacre was that the Dutch were determined to hang on to their monopoly of the nutmeg harvest on the island, and make sure the British didn’t undercut their prices or their influence with the local sultans, who controlled the indigenous nutmeg plantations. In those days, nutmeg was more than the sweet spice it’s thought of today. It was a strategic commodity – almost a matter of national security. That was because it was believed to be able to ward off the fatal attack of the Black Plague.
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by John Helmer - Tuesday, November 12th, 2013
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By John Helmer, Moscow

Interpipe, the leading Ukrainian pipemaker, failed to meet last Friday’s deadline for repayment to its international bankers of $106 million, sources in Kiev have confirmed. Interpipe, owned by Victor Pinchuk (image above) and his wife Elena, daughter of former Ukrainian President Leonid Kuchma, is the largest steelmaker in the former Soviet Union to face bankruptcy and liquidation in recent years. According to sources close to Interpipe, who ask not to be identified, Interpipe’s debts now exceed $1.3 billion; its free cash on hand is less than $50 million.

The group says it continues to produce pipes at its new electric arc furnace plant at Dniepropetrovsk, despite market shut-out measures adopted by Russia, the CIS Customs Union, and the US, which have introduced, or plan shortly to impose penalty duties on pipe imports of 19.4% and 30.8%, respectively. These measures, compounding the generally depressed market demand for pipes, have led Fitch Ratings to slash Interpipe’s earnings estimate for this year by more than $100 million to $260 million, possibly less.
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by John Helmer - Friday, November 8th, 2013
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By John Helmer, Moscow

New evidence has surfaced from the Russian state shipping company Sovcomflot showing that the current chief executive Sergei Frank ordered the company’s lawyers to continue their attempts to prosecute his predecessor Dmitry Skarga in the London and Moscow courts, while telling the General Prosecutor in Moscow they were dropping their case against him.

Last week Frank’s eight-year campaign against Skarga came to an end when the Supreme Court, the highest of the English courts, dismissed Sovcomflot’s application to appeal against two High Court judgements and one Court of Appeal judgement, all exonerating Skarga of Sovcomflot’s allegations, and requiring Sovcomflot to pay more than £8 million ($13 million) in compensation of his costs. The latest episode of that story was reported here.
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by John Helmer - Thursday, November 7th, 2013
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By John Helmer, Moscow

The Pelaco shirt company was a feature of my childhood for an advertising slogan that was so original, it hardly made sense. The idea was that if a native Australian, speaking pidgin English, recommended a Pelaco shirt because it fitted him so well, his recommendation would be credible to white shirt-wearers – even if the aboriginal didn’t wear trousers, and was therefore unlikely to acquire a Pelaco shirt in the first place, let alone a pair of Pelaco pyjamas. In short, the selling-point was preposterous. But fifty years later, the ad slogan is still memorable.

Oleg Tinkov, 45 years old, has the name and the style of advertising which have made him memorable, briefly, on the London roadshow circuit. His idea was that in a market which deeply devalues Russian banks, especially the state-owned ones; and suspects the short-term prospects of the commercial ones are getting poorer by the day, Tinkov would disguise his bank as if it were a credit card payment system, and promote his shares to the market fad for internet payment system companies like Luxoft and Qiwi. The stories of the latter share listings in the New York market can be read here and here. They aren’t banks at all, though in due course they may be threatened by Russian raiders who are banks. Since their initial public offerings (IPO) in June and September, Luxoft is up 71% and now has a market capitalization of $966 million; Qiwi is up 32%, with a market cap of $2.2 billion.
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by John Helmer - Monday, November 4th, 2013
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