Bashneft case
The Bashneft case describes the dispute between the state-owned oil company Rosneft and the private Russian conglomerate AFK Sistema . It is one of the most controversial legal disputes in Russia today .
On May 3, 2017, Rosneft and the Bashneft oil company filed a lawsuit for damages against AFK Sistema and its subsidiary Sistema-Invest for 106.6 billion rubles. The damage is said to have occurred during the restructuring of Bashneft between 2013 and 2014 - when AFK Sistema was Bashneft's main shareholder. In the meantime, the plaintiffs increased the amount of claims to 170.6 billion rubles. The share price of the listed AFK Sistema collapsed after the lawsuit became known.
The legal battle with the largest state-owned oil company was a heavy blow to the market capitalization of one of the leading private investors in the Russian economy and became one of the most famous legal battles since the Yukos arbitration . According to some experts, this had a significant impact on the investment climate in Russia .
background
In 2005, Sistema bought blocking minorities from six Bashkir oil producing, refining and retailing companies for $ 600 million: Bashneft, Ufaorgsintez, Novoil, Ufaneftekhim, Ufa Refinery and Bashkirnefteprodukt. In 2009, Sistema acquired majority stakes in the Bashkir companies for 2 billion US dollars and then consolidated them on the basis of Bashneft. Sistema owned a direct majority stake in the oil company, while its blocking minority was owned by Sistema Invest, with a 51% stake held by Sistema and the remaining 49% held by Bashneft.
In December 2014, Sistema was forced to transfer Bashneft to the Federal Agency for State Property Management (Rosimushchestvo), as the privatization operations carried out by Bashneft in the 1990s without Sistema's involvement had been found to be illegal. Sistema was later recognized as a bona fide buyer of the property and received compensation from the seller Ural Invest according to a court order.
In October 2016, the state-owned company Rosneft acquired a stake of 50.08% in Bashneft for 329.7 billion rubles as part of a "reprivatisation", while the remaining blocked stake was transferred to the Republic of Bashkortostan. Rosneft later acquired the Bashneft shares from minority shareholders as part of a takeover offer and the stake in the company rose to 57.7%.
Chronology of the dispute with Sistema
On May 15, 2017, the Bashkortostan Arbitration Court registered a lawsuit for 106.6 billion rubles filed by Rosneft and Bashneft against Sistema. A preliminary hearing of the case has been scheduled for June 6, and Irina Nurislamova has been appointed as the judge for the case. According to Rosneft, "the reason for the process was that as a result of some administrative procedures, namely restructuring, some assets were withdrawn from the company".
On May 23, Rosneft submitted an application to the arbitration tribunal of the Republic of Bashkortostan to increase the claim to 170.6 billion rubles, with the "strange" reason, according to the NZZ, that the RUB / USD exchange rate had changed since the restructuring of Bashneft.
The Government of the Republic of Bashkortostan (which owns a 25% stake in Bashneft) joined the case on the plaintiffs' side. After the preliminary hearing, the court increased the amount of the claim from 106.6 billion rubles to 170.6 billion rubles, supported a motion by the Ministry of Land and Property Relations of the Republic of Bashkortostan to join the lawsuit as a co-plaintiff, and denied Sistema's motion to involve the Federal Agency for State Property Management (Rosimushchestvo) as a third party on the defendant's side.
On June 20, the Bashkortostan court registered an application from Bashneft and Rosneft to reject the claim against Sistema. The Rosneft spokesman said the company hadn't filed the application and that there had been a "misunderstanding". The court later declared the publication of the “wrong” document a “technical malfunction”; however, in the few minutes from the appearance of the application (until it was withdrawn by Rosneft), Sistema's shares initially rose 16% to 148.2 billion rubles, and then fell 7% to 134.7 billion rubles. Sistema therefore asked the Central Bank of Russia to conduct an investigation into attempted market manipulation following the forged letter to the Bashkortostan Arbitration Court.
On June 21, Sistema appealed against Bashkortostan's involvement in the Rosneft case . Claiming that the claims were absurd, Sistema turned to Rosneft and proposed an out-of-court settlement of the claim by hiring an independent auditor (one of the "Big Four" firms) to review the company's actions during Bashneft's restructuring In 2014, to assess the results of the restructuring and “the financial consequences of this reorganization for the oil company” in order to “determine fairly and impartially the existence of any losses”.
The management of Rosneft, which had previously stated that an agreement was possible, rejected the proposed dispute settlement with the participation of a third party and requested, as a preliminary measure, a 31.76% stake in MTS, a 100% stake in Medsi Group and freeze a 90.47% stake in Bashkir Power Grid Company, which was owned by Sistema and Sistema Invest.
On June 27, the Bashkortostan Court of Arbitration held its first hearing on the matter at which Sistema's request to include Rosimushchestvo as a third party was rejected. The next hearing was scheduled for July 12 [30]. The court also instructed Sistema to provide evidence that Bashneft's restructuring had resulted in no losses and evidence of a positive economic impact of the restructuring, which according to Sistema's attorneys was the Supreme Court Statement and existing judicial practice objected, according to which "the 'burden of proof' lies with the plaintiffs".
On July 6, the Bashkortostan court upheld the interim measures against Sistema and denied Sistema's request for counter-security for Rosneft's claim. According to Sistema, this is necessary because, according to the law, a party requesting security measures must be liable for any damage caused by such measures.
In August 2017, the court of first instance obliged Sistema to pay 136 billion rubles. Sistema announced that it would appeal the verdict.
Chronology of the dismissal and indictment of the Minister of Economy Ulyukayev
Alexei Ulyukayev was arrested on November 14, 2016 and placed under house arrest. He was accused of accepting a $ 2 million bribe as part of the takeover of the state oil company Bashneft. Observers saw this as political motives for President Putin to get rid of Ulyukayev. The procedure is considered constructed. Ulyukayev was considered a liberal who campaigned for a reduction in the state's share.
The trial of Ulyukayev began in a district court in Moscow on August 8, 2017. TASS wrote, Rosneft CEO Sechin will personally testify against Uljukjew and "made sure to question all participants", which was called "the role of a witness remarkable view" in the NZZ as.
Positions of the parties
Plaintiffs believe that the 2013-2014 restructuring of Bashneft resulted in an impairment of the oil company's assets. The restructuring included the termination of the circular ownership structure, a spin-off of the non-core business areas, the repurchase of own shares from minority shareholders and the subsequent cancellation of these shares. Rosneft does not deny the legality of these measures, but argues that the restructuring of Sistema's oil facilities in Bashkortostan was "an act of deliberate and deliberate harm". The new owner decided to reclaim the alleged losses suffered - not from the Federal Agency for State Property Management, which actually sold the assets, but from the previous owner of Bashneft, an effort to “protect its shareholders ”And for the recovery of the“ removed assets ”.
Sistema believed that Rosneft's claims were unfounded and responded by publishing the relevant documents and presentations setting out how it had managed Bashneft until 2014 and the reasons for the reorganization. Sistema stressed that none of the plaintiffs had the legal authority to bring legal proceedings and recommended that Rosneft defend the rights it believes have been violated "by bringing proceedings against the seller of the stake".
The business newspaper Vedomosti stated in its article “Restructuring and the business of the past” that the restructuring that had become the subject of Rosneft's claims seemed a logical step: “The market saw restructuring as a typical measure around that Prepare companies for an IPO; in this context, the circular ownership structure and non-core businesses were seen as an obstacle to a successful initial public offering ( IPO ). ”Shareholders agreed to the restructuring and the company took action to repurchase its shares as required by law. In the course of these operations, Bashneft's shares rose (in the five years that Sistema controlled Bashneft, the company's capitalization increased seven to eight times to 432.4 billion rubles).
Between 2009 and 2014, when Sistema was the majority owner of Bashneft, the oil company's sales tripled, increasing from 215 billion rubles to 637 billion rubles, and oil production increased by 46% from 12.23 million tons to 17.81 million tons and the capitalization increased seven to eight times. The company had a first-class (highest) rating on the Moscow Stock Exchange.
Influence on the investment climate
At the end of the trading day on May 3, 2017, Sistema's share fell 36.92% from the previous closing price to 14.06 rubles per common share. The company's capitalization slipped 79.419 billion rubles to 135.679 billion rubles at the close of trading.
According to the ACRA (Analytical Credit Rating Agency) rating agency, the fall in Sistema's shares under the Rosneft procedure affected the country's financial stability and became the most stressful event for the Russian financial system since mid-March. It was also the first event in recent years that was not caused by an external economic shock. The financial stress index, ACRA FSI, which is compiled by the rating agency and shows how close the Russian financial system is to a crisis, rose 0.15 points on May 3, 2017 compared to the previous day.
At the beginning of July 2016, Russia recorded the highest inflow of foreign investment in 3.5 years, while investment in other emerging markets declined. Foreign investors withdrew more than $ 1.6 billion from Russian assets over the course of four months. Analysts believed that the negative perception of the Russian market was primarily due to internal risks, which worsened the investment climate. This also included the escalation of the conflict between Rosneft and Sistema.
Most of the experts (government agencies, economists, lawyers, political scientists and journalists) who participated in a survey on corporate conflicts in the Russian energy sector conducted by the Platform Center of Social Design in May-June 2017 stated that “the conflict had a negative impact on the investment climate in Russia ”. They only disagreed on the assessment of the severity of this influence, which ranged from “considerable” (“deterioration in the investment climate, which is already anything but favorable”) to “insignificant or minor”, since “the investment climate can no longer get worse . "
After the Sistema shares in MTS , Medsi and BPGC were withdrawn, the company said that tens of thousands of its shareholders and shareholders of MTS “have already suffered losses of more than 150 billion rubles” as a result of the proceedings, which “is all the more outrageous since that Procedure challenged corporate business practices that were publicly and openly seized in 2014 and not challenged by anyone. "
swell
- ↑ Иск "Роснефти" обвалил акции АФК "Система" на 25% - Вести Экономика
- ↑ Суд признал АФК «Система» добросовестным приобретателем «Башнефти» - РБК
- ↑ Предварительное заседание суда по иску «Роснефти» к АФК «Система» назначено на 6 июня - Ведомостиня - Ведомостиня - Ведомостик
- ↑ «Система» не признала обвинения «Роснефти»
- ↑ «Роснефть» увеличила сумму иска к "Системе" до 170.6 млрд рублей - Ведомости
- ↑ «Система» потеряла больше 13 млрд рублей капитализации из-за уточнения иска «Роснефти» - Вед
- ↑ «Система» хочет привлечь Росимущество ответчиком к иску «Роснефти» - Ведомости
- ↑ АФК «Система» попросила ЦБ расследовать попытки манипулирования акциями - РИА Новости
- ↑ АФК "Система" обжаловала вступление Башкирии в дело с "Роснефтью" - Ведомости
- ↑ «Система» предложила «Роснефти» помириться - Ведомости
- ↑ «Система» пожаловалась генпрокурору на судебного пристава - Ведомости
- ↑ Сечин допустил мировое соглашение в споре «Роснефти» и АФК «Система» - РБК
- ↑ Суд: АФК "Система" обязана доказать отсутствие убытков от реорганизации "Башнефти" - Ведомости
- ↑ Суд отказал "Системе" во встречном обеспечении иска "Роснефти" - Ведомости
- ↑ Russian court orders Sistema to pay Rosneft $ 2.3 billion in damages , Reuters, August 23, 2017
- ↑ Russian Economy Minister detained on suspicion of bribery. sputniknews.com, November 15, 2016.
- ↑ Russian minister dismissed and arrested for bribery.
- ^ Sabine Stöhr: Did the Minister of Economic Affairs extort bribes? In: tagesschau.de. November 15, 2016. Retrieved November 15, 2016 .
- ↑ This sum corresponds to a mayor. Spiegel Online, November 19, 2016.
- ↑ a b NZZ , 9 August 2017, page 23
- ↑ The show trial of Ulyukayev. Spiegel Online, August 8, 2017.
- ↑ Сечин объяснил иск «Роснефти» к АФК «Система» - РБК
- ↑ У "Роснефти" нет права требовать 106.6 млрд рублей - АФК "Система" - Ведомости
- ↑ Реконструкция бизнес прошлого - Ведомости
- ↑ Котировки АФК "Система" рухнули на треть - Ведомости
- ↑ Индекс финансового стресса АКРА (ACRA FSI) - АКРА
- ↑ Перезагрузка оттока - Коммерсант
- ↑ Корпоративные конфликты в России. Исследование. - Платформа
- ↑ Арестованы принадлежащие АФК "Система" акции МТС, "Медси" и БЭСК - Ведомости