Банкеръ Weekly

Briefs

WE WON'T ALLOW RUSSION PROPERTY TO BE ANNEXED

Alexander Semernyov, Head of Goszagransobstvenost Regional Office, to the BANKER weeklyMr. Semernyov, has Russia drawn up officially its reparation claims to Bulgaria? What is the amount of these claims?- On November 28, 2001, with regard to the expected privatisation of Bulgartabac Holding, the Embassy of the Russian Federation sent a note to the Bulgarian Ministry of Foreign Affairs informing that it possessed documents, confirming that part of Bulgartabac Holding's assets remain property of Russia. These assets were given to the Soviet Union after it won the World War II. The stand of the Russian State was believed to be presented to the respective state authorities in Bulgaria, as well as to the directors of the Privatisation Agency (PA) and the potential candidate-buyers of the tobacco holding.During his visit to Bulgaria last February, B.D. Yurlov, first deputy of the governor of the Russian President's affairs, had a meeting at the Ministry of Economy. The Bulgarian representatives received copies of some of the records that gave reasons to Russia's claims. Besides, when Yurlov met Bulgaria's Vice Premier Nikolai Vassilev, he was given a letter on behalf of the governor of the Russian President's affairs, Vladimir Kozhin. The letter proposed the establishment of a joint commission of Russian and Bulgarian experts that would regulate the property claims of both countries. It also proposed that the privatiaation of Bulgartabac be stopped until the claims of the countries are settled.In end-March the Chairman of PA's Supervisory Board Petko Nikolov and PA's Executive Director Apostol Apostolov received a letter. It informed the agency that Russia had made official claims to some of the assets of Bulgartabac Holding AD. The letter read that if the legal rights of the Russian Federation were not taken into consideration when the holding's privatisation was concluded, it would seek to defend its economic interests in accordance with the generally accepted international law regulations. Since there was no official reaction from Bulgaria to Russia's numerous invitations to discuss these issues, the Embassy of the Federation sent another note to the Bulgarian Ministry of Foreign Affairs on April 4, 2002.The interdepartmental group of Bulgarian and Russian experts held a meeting on April 18, 2002, at which the Bulgarian representatives received records, confirming the lawfullness of the Russian claims to part of Bulgartabac's assets. Even though the two sides reached an agreement to keep operating as soon as the records were reviewed and the necessary consultations were made, the experts never met again.Russia laid its claims to these assets once again during the negotiations between the prime ministers of both countries, held within the visit of Bulgaria's Premier Simeon Saxe-Coburg-Gotha to Moscow in early June.Has this problem anyting to do with the ownership of the Russian diplomatic representative offices in Bulgaria?- No, it has not. As I already said, the claims are laid to assets given to the former USSR in the form of reparations after the World War II. They are based on decisions of the Berlin Peace Conference and on the Law of the Kingdom of Bulgaria for Submission of German Property to the USSR, published in the Official Gazette on May 31, 1946. Other documents issued in the aftermath of the World War II serve as grounds too. Most of these assets have later been granted on lease to Bulgaria. It's worth noting that from a historical point of view these assets have never been property of Bulgarian natural or jusritic persons.To what extent will the deal on Bulgartabac Holding influence the future attitude of the Russian Government to Bulgaria?- It's not only a question of Bulgartabac's assets and it does not concern Bulgaria only. Under the Decree of the President of the Russian Federation, investigation, protection and due legalization of Russia's ownership rights is being carried out regarding all estates abroad of both the Russian Empire and the former Soviet Union.Are there opportunities for closing an agreement and when could negotiations on that issue begin?-Russia has repeatedly declared its readiness to start bilateral negotiations for settling these property interests. We presume that Bulgaria has not lacked time after November 2001 to prepare for discussing this issue.On what will the scheme and the ways for settling these claims depend?- The scheme depends on the kind of ownership. As this is public property of the Russian State, expropriation of this property is not possible and any deal with it shall not be legally valid under international law. Moreover, this concerns decisions of the Potsdam Coference of 1945.And concerning the way for settling these claims - it will be a subject of negotiations between the Russian and the Bulgarian side. In particular, Bulgartabac's privatisation should be effected to the benefit of Bulgaria, but preserving the interests of the Russian Federation as well. Most of the holding's potential buyers confirmed their readiness do do that. They realize that it would be practically meaningless to acquire Bulgartabac if they lose the Russian market. Something more - proceeding from the type of the holding's ownership we could assume that not anyone of the possible winners in the present procedure for the privatisation fo Bulgaratabac Holding could be considered a scrupulous buyer. Any actions with property of the Russian State without its concent is illegal from a juristic point of view.Has the issue for acknowledging these claims as Bulgaria's state debt to Russia been discussed?- No it hasn't. This is not Bulgaria's state debt. This is property of the Russian State that cannot be annexed.What will happen if the Bulgarian side keeps silent regarding Russia's claims?- Only one thing can be definitely said - this will not cause World War III, but Russia won't allow anyone to reconsider the results of World War II...

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