Page 14 - bne IntelliNews monthly magazine May 2024

14 I Companies & Markets bne May 2024
London. Prior to Russia's invasion of Ukraine this investment vehicle had been trying to get back into the oil business internationally, as well as making other profitable investments.
Fridman grew to prominence in the 1990s after his Alfa Group made him a billionaire. After getting his start as a window cleaner in the aftermath of the collapse of the Soviet Union he went on to found a business empire that includes Alfa Bank, the highly successful X5 retail and supermarket group and numerous other businesses.
“It is unlikely that the Council of the EU will not implement the decision of the Court – and if it does, it will create an important precedent for challenging sanctions decisions made without proper legal grounds”
Volkov criticises the decision
The decision to lift sanctions on the two tycoons was not welcomed by Leonid Volkov, the former head of the late opposition activist Alexei Navalny who died in prison on February 16.
Volkov was ensnared in a scandal when it emerged that
he had written to the EU supporting Fridman’s application
to have sanctions lifted. As an active member of the anti- Putin movement, critics said it was inappropriate for such
a high-profile opposition leader to be lobbying on behalf of an oligarch that was seen to be supporting the Russian regime by maintaining profitable businesses in Russia. Volkov was forced to resign.
However, reversing his former support for Fridman, Volkov condemned the decision in a post on X, saying there were no grounds for the EU’s change of heart.
“When a year and a half ago I (extremely unsuccessfully) tried to act as a mediator between the owners of Alpha and European officials, the point of the story was to
a) create a precedent, open the way for the escape of the pro-Putin elites,
b) condition the lifting of sanctions on a public break with Putin and active repentance,
c) create a transparent, reproducible mechanism for getting out of sanctions.
“It didn't work out – but I still think there was a point in trying. But what the Europeans have done now makes no sense.
www.bne.eu
“Fridman and Aven never said a word publicly against the war and did not come into conflict with Putin. The EU Court simply gave them what they wanted on a silver platter. For what? What signal does the court send to Putin, his friends, and Russian oligarchs? A transparent mechanism for exiting sanctions through a public break with Putin and active repentance has not been created. ‘Better hire more European lawyers and lobbyists,’ says the court. This is all very, very bad,” Volkov wrote.
Setting a precedent
But the two Alfa Group tycoons are not out of the woods yet. The ruling by the European court in Luxembourg was clear that one set of sanctions will be lifted, but the second set will remain in place – a partial victory.
Influential Russian academic Vladislav Inozemtsev, the former director of the Moscow-based non-profit think tank Centre for Research on Post-Industrial Societies and now classed as a “foreign agent” by the government after he fled into exile, said in a post on Telegram that he was sure the Council of Europe lift the sanctions on Fridman and Aven and set an important precedent by doing so.
“It is unlikely that the Council of the EU will not implement the decision of the Court – and if it does, it will create an important precedent for challenging sanctions decisions made without proper legal grounds,” Inozemtsev wrote. “I am not saying that all sanctions are wrong, but I am pointing out that politicians are not too "bothered” when they were introduced,” Inozemtsev added.
Inozemtsev points out that fellow tycoon Alisher Usmanov was placed on the same sanctions list as Aven and Fridman on the same day at the start of the war in Ukraine, accused of acting as a front for Russian President Vladimir Putin’s financial affairs, as reported by Forbes.
Part of the text of that article, “migrated to the decision of the EU Council in the best Russian traditions - simple copy-paste,” says Inozemtsev.
However, that article is no longer available as Forbes was forced to remove it after a court in Hamburg three months ago ruled the claims were baseless, Inozemtsev points out, citing
a bne IntelliNews report on the case.
Inozemtsev speculates that given the precedent set in the Fridman-Aven case will have a knock on for other cases such as Usmanov’s battle to have his name cleared. Usmanov appealed against his inclusion in the sanctions list, but in February his plea to have his name removed was rejected.
I think that now the decision on A. Usmanov will not stand
up in the EU Court either. In general, the precedent of
M. Fridman and P. Aven shows that in the West the judiciary is still able to correct the mistakes of the executive branch. This is certainly good news for the West itself: with the likely increase of populism in developed countries, the courts will have more work to do in the coming years....” says Inozemtsev.