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Russian Prosecutor General’s Office seeks to nationalize three factories allegedly illegally privatized in 1990s — Meduza [1]

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Date: 2024-02-13  

The Russian Prosecutor General’s Office has filed a claim with the Sverdlovsk region Court of Arbitration to seize shares in three (CHEMK) industrial enterprises due to their illegal “seizure” in the 1990s, according to Kommersant. Seizure of the shares would mean nationalization, in essence.

The request concerns the Serov Ferroalloy Plant, the Chelyabinsk Electrometallurgical Plant, and the Kuznetsk Ferroalloy Plant. Currently, they belong to the company Etalon.

The prosecutor’s office claims that from 1993 to 1999 regional committees and property funds “clearly acted in excess of their authority” when approving the privatization of the facilities, and distributed 100% of the shares “which did not belong to them,” thus the assets were obtained illegally.

Additionally, the Prosecutor General’s Office claims in the lawsuit that CHEMK’s products, intended for the production of weapons and ammunition, are exported to the United States, France, and the United Kingdom at an undervalued price and “to the detriment of national interests.” In February 2023, one of the owners, Yuriy Antipov, registered the plants’ assets to the company Etalon, meaning they would fall “under the control of residents of unfriendly states,” and would then be . In particular, the lawsuit refers to Canadian-Swiss RFA International, which acts as a trader of CHEMK.

CHEMK said that similar privatization schemes were used “in absolutely every region of Russia,” but “mistakes” were found only in a few enterprises. The owners also claim that their enterprises are not part of the military-industrial complex, but that their products are supplied to metallurgical companies, and then those companies send steel to defense plants.

Kommersant also notes that violations during privatization have served as the basis for similar lawsuits filed by the Prosecutor General’s Office against two other enterprises: Volzhsky Orgsintez and Metafrax Chemicals.

As part of the case, the court seized the shares, as well as movable and immovable property of the three CHEMK plants. A final decision in the lawsuit has not yet been made.

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[1] Url: https://www.meduza.io/en/news/2024/02/13/russian-prosecutor-general-s-office-seeks-to-nationalize-three-factories-allegedly-illegally-privatized-in-1990s

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