PRESS RELEASE: Official Statement by Sergei Pugachev’s Press Office

November 20, 2015 – In response to recent publications in the Russian media reporting that the Russian law enforcement agencies have involved Interpol in their quest to establish Sergei Pugachev’s whereabouts, the Press Office states the following:

Sergei Pugachev, a citizen of the Republic of France, has been living in France with his family since the beginning of the 90s, and since 2010 Mr. Pugachev is living in France on permanent basis.

Mr. Pugachev renounced his Russian citizenship in 2012 in connection with the expropriation of his assets in Russia. At the end of 2014 the Interpol Russian Bureau placed Mr. Pugachev’s name on its wanted list. In 2015 Mr. Pugachev’s name was removed from the list following the appeal filed by Mr. Pugachev’s French lawyers to the Interpol Central Bureau. Today Mr. Pugachev’s movements around the world are not restricted.

Sergei Pugachev and his lawyers believe that the allegations by the Russian authorities targeting Mr. Pugachev are politically motivated and judicially groundless. The legal team is awaiting action proceedings at the International Arbitration Court in the Hague in regards to Mr. Pugachev’s $12 billion compensation claim against the Russian Federation.

Sergei Pugachev is being represented by one of the world’s biggest American law firms, King & Spalding LLP. At the moment legal procedural steps are being taken to obtain interim measures in the form of seizures of the Russian Federation’s property in various jurisdictions.

Sergei Pugachev’s Press Office

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PRESS RELEASE 20.11.15 PDF VERSION

PRESS RELEASE: International Arbitration Claim Launch

Pugachev Files International Arbitration Against the Russian Federation Over Violations of the France-Russia Bilateral Investment Treaty with Estimated Damages of US$ 12 Billion

PARIS, France, September 22, 2015 – Mr. Sergei Pugachev, a French national and international businessman, has filed an international arbitration claim against the Russian Federation for damages estimated at US$12 billion citing violations of the country’s obligations under the France-Russia Bilateral Investment Treaty and international law. The complaint stems from the Russian Federation’s mistreatment of Mr. Pugachev and his investments, outright taking of several multi-billion dollar investments without paying any compensation, coercion of Mr. Pugachev to enter into transactions on unfavorable terms, threats to the security and wellbeing of Mr. Pugachev and his family, and sham criminal proceedings against him. The arbitration proceeding has been commenced under the 1976 Rules of the United Nations Commission on International Trade Law.

Mr. Pugachev’s claims relate to the Kremlin’s campaign and targeted strategy, since 2009, to strip him of his valuable investments without paying him any compensation whatsoever. Among the investments that the Russian Federation has taken are: (1) the Red Square 5 development project, which was authorized to build a major hotel and residential complex in Moscow; (2) the Shipyards, Russia’s biggest and most modern shipyards, which included the nation’s leading designer of icebreakers and builder of military ships and commercial vessels; (3) the EPK, a company that held the exploration and extraction license to develop one of the richest coalfields deposit in the world located in the Tuva region in Russia; and (4) Optik Trade, which owned and planned to develop land plots in the Moscow Region and the related Gribanovo development project. The Russian Federation also has instituted and pursued sham civil and criminal proceedings against Mr. Pugachev, with the expressed intent to ruin Mr. Pugachev and his family. The Russian Federation is using these unfounded proceedings as a basis for exporting its persecution and harassment of Mr. Pugachev to other jurisdictions, like the U.K. or Switzerland, which has inflicted additional harm on Mr. Pugachev. Those actions ultimately also resulted in the loss of investments in countries outside of Russia. All of this conduct is in breach of Mr. Pugachev’s rights under the France-Russia Bilateral Investment Treaty and international law. In addition, legal counsel is exploring the possibility of a claim also to be brought against Russia for violations of the European Convention on Human Rights as a result of the treatment of Mr Pugachev.

“Over the past few years, Russia has pursued a multi-pronged attack against me, my family, and my investments. I refuse to be intimidated by Russia’s tactics, and I look forward to having an international arbitral tribunal assess Russia’s conduct by applying international standards,” said Mr. Pugachev.

“Mr. Pugachev’s filing today should not come as a surprise,” added Mr. Edward G. Kehoe, of King & Spalding LLP, lead counsel to Mr. Pugachev in the international arbitration proceedings. “Russia’s conduct violates the Bilateral Investment Treaty’s guarantee of fair and equitable treatment and prohibition against unlawful expropriation with respect to French investors, among other protections.”

“Russia cannot continue its worldwide persecution of Mr. Pugachev with impunity. This international arbitration proceeding is intended to hold Russia to its international obligations under the Bilateral Investment Treaty”, said J. Michael McNutt, Senior Litigation Advisor to Mr. Pugachev.

Mr. Pugachev is not alone in highlighting Russia’s misconduct and its hostility towards foreign investors. At present, over ten (10) investment treaty arbitrations against Russia are pending. Most recently, an international arbitral tribunal ordered Russia to pay former shareholders of the OAO Yukos Oil Company approximately $50 billion in compensation for unlawful expropriation through a series of targeted measures taken between 2003 and 2007.

Mr. Pugachev’s notice of arbitration has been delivered to the Minister of Economic Development of the Russian Federation, as well as to Russia’s President, Minister of Finance, Minister of Foreign Affairs, and Minister of Justice of the Russian Federation. Upon appointment of the arbitrators to hear the case, the tribunal will establish a schedule for briefings and arguments on the merits.

Copies of the petition in English, as well as related materials, can be found on the ‘Litigation’ page at www.pugachevsergei.com.

PRESS RELEASE: Pugachev Forced to Leave London Due to Severe Threats Against His Life

LONDON, 9 June 2015 – Sergei Pugachev, a French citizen, former Russian Senator and business magnate is confirming today that he was forced to leave London and the UK due to serious concerns regarding his personal safety and increasing harassment, as part of an unlawful seizure of his assets by the Russian State.

The difficult decision to leave the UK was made after suspicious devices were discovered to have been illegally fitted on his cars. The anti-terrorist unit SO15 is investigating the crime also as a potential bomb threat and has identified the suspects.

In July 2014, The Russian State initiated interim measures in the UK to support their continuous abuse in the form of the civil case in Russia. Beyond these, there were no other claims against Mr. Pugachev in the UK.

To fight the unlawful expropriation of his business assets and forced financial ruin Pugachev has initiated an international arbitration claim against Russia.

Until his departure, Pugachev had been under the protective watch of British police, he wishes to return to the UK after the threat to his safety will be resolved:

“Even if I had police protection, had I stayed, I would still feel that my safety was severely compromised. I will return to the UK once I can be assured that the threat against my life has been eradicated”

Press Office of Sergei Pugachev

PRESS RELEASE: Sergei Pugachev denies allegations of intentional bankruptcy and misappropriation

MOSCOW, 7 February 2014 – The Moscow City Court on Monday upheld the refusal of the Basmanny District Court to arrest businessman Sergei Pugachev in absentia.

It was alleged that Pugachev, a former Russian senator and founder of International Industrial Bank (IIB), was  involved in misappropriation of funds and the intentional bankruptcy of IIB.

In a statement released today, Pugachev denies involvement in any wrongdoings. Pugachev’s lawyers argue that the legal proceedings have been replete with irregularities, and the wrongful application of law enforcement agencies to solve commercial disputes, echoing the experience of high profile Russian businessmen such as Mikhail Khodorkovsky. Under Russian law, the charges brought against Mr. Pugachev are associated with business activities, and recourse for arrest in absentia is not available. Despite these provisions, the Basmanny District Court granted an arrest warrant late last year. Defence counsel successfully argued that there were serious problems with the decision, and the ruling was quashed on appeal.

A further attempt to have the Basmanny Court grant an arrest warrant was denied in January 2014. The Moscow City Court’s decision today to uphold the refusal of the lower court highlights once again the highly irregular manner in which the justice system has been used in this matter. The charges against the former politician were met with surprise by many, given the widely held belief that Mr Pugachev, who served in the Russian Senate from December 2001 to January 2011, was close to both former President Boris Yeltsin and to current President Vladimir Putin.

Speaking for the first time about the matter, Sergei Pugachev commented: “In the last few years, law enforcement agencies have become the main tool for solving commercial disputes in Russia. Ever since I left the country, every one of my main domestic assets has been facing raiding attempts or expropriation. I have also been on the receiving end of threats and attempts at extortion. The unsubstantiated criminal allegations against me are consistent with that.The International Industrial Bank was founded by me more than 20 years ago but after I disposed of my shares over ten years ago, I no longer had any involvement, let alone control over its activities. If its bankruptcy was indeed intentional, it would have to have been instigated by the Russian Central Bank, which closely supervised its activities, and the Central Bank’s Chairman.” 

The case re-ignites the public debate about the Russian justice system and its impact on doing business in the country, at a time when Russia is in desperate need of inward investment. The pardoning of Mikhail Khordorkovsky late last year and the release of his business associate Platon Lebedev in January had been interpreted as signs Russia’s authorities were taking steps to appease international opinion. The authorities’ continued pursuit of Mr Pugachev, along with his statement made today that his domestic assets have been subject to raids and attempts at expropriation, goes against this trend. In an interview on 15 January 2014 with Radio Ekho Moskvy, counsel for the defence Aleksandr Gofstein said that Sergei Pugachev will plead not guilty and the prosecution does not have sufficient evidence, “the fact is that there was no crime, and that’s why there is no documentary evidence of criminal activity.”

Press Office of Sergei Pugachev

PDF version of the Press Release 14.02.07