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What is Khordorkovsky getting for Christmas?

Jailed tycoon Mikhail Khodorkovsky, the former chief executive of bankrupted Russian oil giant YUKOS, is once again in the forefront as a Moscow court prepares to hand down its verdict on 15 December in a second trial that could add six more years to the eight-year prison sentence that he is already serving on related tax charges.

Nobody knows what the verdict in the second trial is going to be. But with the Russian presidential elections in 2012, an outright acquittal seems a little unlikely since it would allow Khodorkovsky to be freed when his current sentence ends in 2011.

Khodorkovsky's supporters, including critics of Vladimir Putin, claim the charges are revenge from the Russian leader for the businessman's political ambitions. But in the case of YUKOS it came down to downright greed, Russian analysts told New Europe in Moscow.

At the time of Khodorkovsky's arrest in 2003, YUKOS was one of the most successful Russian companies and its assets were allegedly coveted by Igor Sechin, now Putin’s first deputy prime minister, and other allies of the former KGB-er. After Khodorkovsky's conviction, YUKOS was broken up and its assets were largely taken over by the state-run oil giant Rosneft, which Sechin chairs. Khodorkovsky had been financing opposition parties before State Duma elections in December 2003, and people in Putin's inner circle eyeing YUKOS might have made the case for getting rid of Khodorkovsky before mounting a Kremlin bid, the analysts said. Exxon had considered buying a stake in YUKOS before Khodorkovsky's arrest in October 2003. A merger between YUKOS and Russia’s Sibneft was also under way. And even though pressure was mounting on Khodorkovsky, the oil tycoon appeared sure of himself not expecting that on 25 October 2003 he would be arrested.

The image of Khodorkovsky taken away by masked FSB operatives changed the plans of investors. But Konstantin Simonov, director of the independent National Energy Security Fund told New Europe in Moscow last week that “Russia does not want to struggle with foreign investors.” Russia tycoons have problems sometimes in the country but not foreign businessmen, he said. Simonov added that Russian needs foreign investment and technological knowledge, citing as an example that the Russian government plans new deals with foreign firms to get Yamal gas on stream.

Asked by New Europe if the case of Khodorkovsky still discourages foreign investors, the senior vice-chairman of the ruling United Russia Party’s Supreme Council, Andrey Isayev, said he doesn’t see any connection between Khodorkovsky’s case and foreign investments. “There is criminal legislation in all the countries which punishes tax evasion,” he told the forum “Investigating Russia” in Moscow on 22-24 November. Russia's senior human rights activist Lyudmila Alexeyeva said there is complete uncertainty about Khodorkovsky’s case. “I don’t think he will be indicted because it will be disgraceful but, on the other hand, I cannot see how they are going to acquit him with the current state of affairs. On December 15 they will start reading the sentence,” she said. “But, you see, there is the New Year and Christmas Holidays. After the 25th of December people will stop addressing that. They probably decided to do that in December for that particular reason.”

Kostis Geropoulos

New Europe, November 28, 2010


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Analytical series “The Political compass”:

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State Corporations in the Russian Economy
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Political Landscape Ahead of the Parliamentary Election 2007
«Centers of influence» in the Russian politics

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