Businesses reacted to the EU sanctions
26 January 2021 | Ihar Aliakseyeu, TUT.BY
It has been more than a month since the moment when the European Union
imposed sanctions on Belarusian companies and businessmen. How did they react to being blacklisted?
Let’s recall that the sanctions have been imposed on seven legal entities. Most of them are organizations that specialize in the military field including the Barysau tank repair enterprise 140 Repair Plant, the Minsk Agat Electromechanical Plant, the Minsk Wheel Tractor Plant, and the special arms exporter Beltekheksport. The EU has also blacklisted the General Economic Department of the Presidential Property Management Department, a private construction company Dana Holdings, Synesis IT company, and two businessmen (Mikalai Varabei and Aliaksandr Shakutsin).
Varabei was the first to react to the sanctions. Its managers became the owners of the Interservice oil trader, Absolutbank, and the Krasny Bor hunting complex. However, it did not save him from trouble. The National Bank of Ukraine refused Mikalai Varabei’s request for the acquisition of the Ukrainian BTA Bank. Failure to provide sufficient documents and information to confirm the compliance of the applicant’s financial condition and sources of his own funds has been named as one of the grounds for refusal.
Meanwhile, the businessman launched a game meat processing workshop in Belarus. The grand opening was attended by Prime Minister Raman Halouchanka.
It is interesting that in the European Union list Mikalai Varabei is presented as a co-owner of the Bremino Group company which enjoys tax breaks and other forms of assistance from the Belarusian authorities. “Thus, he benefits from the Lukashenko’s regime and supports it,” the sanctions’ creators say.
Bremino Group has built two logistics centers near the border and is now creating a multimodal complex in the Orsha region. It was owned on a parity basis by Varabei, Aliaksandr Zaitsau, and Aliaksei Aleksin. At the end of 2020, Aliaksandr Zhuk, Vital Kaspiarovich, Illia Yarmalovich and Dzmitry Vidmanau became members of the Bremino Group. People with these names provide legal services. Their total share of company ownership is less than 0,5%.
The chairman of Amkodor holding board of directors, Aliaksandr Shakutsin, has submitted applications to the European organizations in which he expresses his disagreement with the sanctions imposed against him. He refers to the fact that some of the information about him is inaccurate or outdated.
Even before the sanctions, a part of the businessman’s assets had been on his son’s name, who, soon after the elections, began to manage the Russian company Amkodor-Onego.
The Minister of Industry, Petr Parkhomchyk, said that a number of Finnish and German companies began to delay the supply of components to Amkodor.
The EU’s decision to impose sanctions also affected enterprises that “produce military-industrial products”.
“I think we will very carefully look at the nomenclature that determines the production of the final product, […] where we can, we will look for other ways […] Europe does not want to supply us, but China will. Finding other suppliers who are ready to supply products today is a possible way out,” said Parkhomchyk.
The sanctions against Synesis forced this IT company to take action.
On 18 December it announced the intention to appeal the decision of the European Union in court. The company considers the “verdict” to be wrong on many levels and based on a misunderstanding of how facial recognition technology works. Hi-Tech Park resident is a creator of the Kipod video surveillance platform. The EU believes that with the help of this platform, the security forces identify the protesters in Belarus.
On 24 December, Synesis, created by the natives of Moscow, announced that it would rename all of its companies that had not fallen under the sanctions, but whose names contain the word Synesis. We are talking about the companies Synesis Lotto (now Ridotto), Synesis Atlas (Atlas Acme), Synesis Stigma (Stigma Soft), and Synesis Sky (Sky Nolimit).
LLC Synesis itself now has only one owner, Aliaksandr Shatrou. His partners and the Aleksin family left the company.
At the end of December 2020 American company GSD Venture Studios announced its refusal to cooperate with Synesis. They had previously expressed a desire to promote Kipod on the US market. “The European Union has recently introduced sanctions. GSD Venture Studios is a strong advocate for civil and political rights. GSD Venture Studios is no longer working with Synesis,” said the co-founder of the American company, Gary Fowler.
Apparently, businessman Aliaksei Aleksin began to act simultaneously with IT specialists and created a system operator for monitoring international transit traffic. Alongside Synesis, a platform for electronic truck sealing and monitoring the status and location of transit cargo was developed.
So, Aleksin has given up the ownership of Energooil and Belneftegaz. The information about the new composition of owners is posted on the website of MTBank owned by these legal entities.
Before Aliaksei Aleksin had controlled 60% of both Energooil and Belneftegaz. The remaining 40% had belonged to Ina Aleksina. Now the sons of the businessman, Dzmitry and Vitaly Aleksin, own 40% of both Energooil and Belneftegaz. According to the information on the bank’s website, 20% of the companies in question are still owned by their mother Ina Aleksina.
Aliaksei Aleksin, who had created a tobacco factory in Minsk in partnership with Philip Morris and planned to purchase the Polish Idea Bank, was discussed as a candidate for inclusion in the EU sanctions list. However, sanctions were not imposed on him.
Dana Holdings, owned by the Serbian brothers Karic, fell under the European sanctions with the following wording: “The owners of Dana Holdings/Dana Astra maintain close relations with Alexander Lukashenko. Liliya Lukashenko, the president’s daughter-in-law, holds a high position in the company. Thus, Dana Holdings/Dana Astra benefits from supporting the Lukashenko regime.”
Dana Holdings now includes at least four construction companies. These include Dana Astra, Emirates Blue Sky, Emirates Blue Sky, and Dubai Water Front.
Both Emirates Blue Sky and Dubai Water Front are completing their construction and investment attraction activities in Belarus as the company has announced shortly after the imposition of sanctions.
Thus, Dana Astra remains on the market and continues to build the Minsk-Mir complex. As for the residential areas built by the Emirates Blue Sky and Dubai Water Front, they are maintained either by owners’ associations or by Dubai Property Management.
Office of Presidential Affairs
In Lithuania, the sanatorium Belarus, which is controlled by the Office of Presidential Affairs, fell under the sanctions. Swedbank has blocked the company’s accounts. The management of the sanatorium came to an agreement with the bank to allow the payment of salaries to the employees and tax payments. Most of the employees of the sanatorium in Druskininkai are Lithuanian citizens (about 400 people). They came out in protest and asked for help from local authorities and a former presidential candidate Sviatlana Tsikhanouskaya.
However, sanatorium Belorussia, located in Jurmala and controlled by the same Office of Presidential Affairs has not fallen under the European sanctions and continues to operate. The employees of that health resort received a downtime allowance in December, writes Kas Jauns Avize.
According to the local media, the nuance is that the Latvian health resort is connected with the Administrative Department of the President of Belarus, against which no sanctions have been imposed. In the case of Lithuania, the sanatorium is under the patronage of the Main Economic Department of the Office of Presidential Affairs which is under sanctions. The Office of Presidential Affairs failed to clarify this information.