BVI Offshore Business: Grey Area

The Moscow Arbitration Court announced this week that it would delay the decision on whether the seizure of 29.9 per cent stock in VimpelCom owned by Norway’s telecommunications company Telenor will be blocked. The hearing is rescheduled to the end of April. Also, the judge asked representatives of VimpelCom to attend it, and this would be the first time when this company being in the middle of the Telenor-VimpelCom case will appear in the court.

Earlier, it was decided by the Omsk court that Telenor is to be deprived of its share in Russia’s mobile operator. Telenor asked the Moscow court to block the seizure of its stake in VimpelCom, after the Norwegian company refused to pay a court-ordered $1.7 billion fine.

In February, the Omsk court ruled in favor of the BVI company Farimex, which brought the suit against Telenor, claiming that it delayed VimpelCom’s entry into Ukraine. Telenor has linked Farimex, which owns a 0.002 per cent stake in VimpelCom, with Alfa Group’s telecoms arm Altimo, the other main shareholder of VimpelCom, and the telecoms arm of Russian tycoon Mikhail Fridman Alfa Group. Alfa denies any connection to the case.

Before the Moscow court hearing, there will be an April 28 hearing in Tyuman, where a court will hear Telenor’s appeal concerning the execution of the Omsk court’s ruling to the BVI company. The appeal of the original case probably will be heard in the end of May.

The case is tied to related suits in Kiev and New York, and it can create the precedent for shareholder rights in Russia. The lawyer of BVI-based Farimex said that the company does not want Telenor to lose its stake. By his words, Farimex is not interested in the shares of the Nordic telecoms company, but rather in compensation for the losses.