The outcome of the meeting of the Government Commission on Foreign Investments of 30th July 2012
On 30th July 2012, the Government Commission on Foreign Investments in Strategic Companies of the Russian Federation considered several issues, in particular, expansion of foreign organizations towards Russian fishery companies in the Russian Far East. For a number of years some foreign companies, including, “Pacific Andes” (Hong Kong, the Peoples Republic of China), have pursued establishing control over certain Russian fishery companies.
Under Clause 40 Article 6 of No.57-FZ Federal Law “On the Procedures for Foreign Investments in Economic Entities of Strategic Importance for National Defence and State Security”, catching (harvesting) water biological resources is a strategic activity. Accordingly, companies exercising such activity are strategic companies. Therefore, any actions towards establishing control over such companies require approvals (permissions) and a relevant decision of the Government Commission on Foreign Investments, led by the Chairman of the Government of the Russian Federation. By exercising certain actions, in particular, acquiring shares and concluding special agreements, foreign companies acquired control and harvested water biological resources without a permission from the Government Commission.
On 30th July 2012, the Government Commission on Foreign Investments instructed ministries and governmental agencies to undertake certain measures in order to bring operations of these foreign companies in line with the current law of the Russian Federation.
as a result of such unlawful operations, a considerable part of biological resources valued at many dozens of billion Rubles is removed from Russia in breach of the national law, causing damage to Russian economy.
To execute the decision of the Government Commission on Foreign Investments, in the near future specific measures towards establishing law and order in this field will be devised.
On 30th July 2012, the Government Commission also discussed the issues related to the effort of some shareholding companies of the Islamic Republic of Iran to control operations of “Astrakhan Port” OJSC. Earlier, the Government Commission refused to allow an Iranian company to acquire the controlling block of shares of “Astrakhan Port” OJSC in accordance with the international sanctions imposed upon the Republic of Iran and on the basis of a Decree of the President of the Russian Federation. Nevertheless, the companies tried to establish control over the port in violation of the decision made earlier by the Government Commission.
FAS informed the Government Commission that Astrakhan Regional Court granted interlocutory injunctions, in particular, prohibited paying dividends of “Astrakhan Port” OJSC and exercising any operations with the company shares.
Currently documents are being prepared to file a lawsuit in order to hold the transactions void.
FAS also informed the Government Commission about fulfilling its order to negotiate with the shareholders of “Vympelcom” OJSC in order to resolve a dispute with “Telenor” and discuss violating No.57-FZ Federal Law by “Telenor”. The Government Commission confirmed its position about importance of resolving the dispute as soon as possible by holding negotiations with “Telenor”, particularly, with regard to observing No.57-FZ Federal Law.
Border-line conditions (proposals) put forward by the Government Commission to resolve the dispute were approved. Ministries and governmental agencies were instructed to refine the proposals and forward them to “Telenor” in the near future. Thus, the Government Commission opted for finding common grounds with one of the largest investors operating in Russia.
On 30th July 2012, the Commission also approved a petition of “ТNК-ВР” for establishing control over fuel-and-refueling complex in Sheremeyevo airport.
The Government Commission also considered and approved several transactions of “T.S. Trans Siberia” Ltd. on acquiring control over airports in Astrakhan, Chita, and Tomsk, and approved a transaction of “AgustaWestland S.p.A.” (Italy) regarding “HeliVert” CJSC (the Russian Federation) for the purposes of manufacturing state-of-the-art helicopters in Russia.
The Commission also heard FAS report on enforcement practice of No.57-FZ Federal Law in 2008 – 2011 and the first half of 2012.
More detail about the outcome of the meeting of the Government Commission on Foreign Investments shall be given by the Head of FAS Igor Artemyev at a press-conference on 31st July 2012.