RUSSIA: RUSSIAN OIL GIANT YUKOS AWAITS BAILIFFS AFTER FAILURE TO MEET A $3.4 BILLION TAX DEADLINE

Record ID: 344915

  • Title: RUSSIA: RUSSIAN OIL GIANT YUKOS AWAITS BAILIFFS AFTER FAILURE TO MEET A $3.4 BILLION TAX DEADLINE
  • Date: 8th July 2004
  • Summary: (U3) MOSCOW, RUSSIA (JULY 8, 2004) (REUTERS) 1. TILT: EXTERIOR OF YUKOS HEADQUARTERS IN MOSCOW 0.06 2. CU: YUKOS LOGO 0.12 3. YUKOS STAFF ENTERING THE BUILDING 0.17 4. DIRECTOR OF YUKOS INTERNATIONAL INFORMATION DEPARTMENT HUGO ERIKSSEN TALKING TO JOURNALIST 0.22 5. YUKOS STAFF ENTERING THE BUILDING 0.31 6. (SOUNDBITE) (English) DIRECTOR OF YUKOS INTERNATIONAL INFORMATION DEPARTMENT HUGO ERIKSSEN: "We have no idea in respect what may happen today. The court bailiffs may come, they may not come, they may come to another location, we have no indication of what will happen." 0.40 7. PEOPLE ENTERING YUKOS BUILDING 8. (SOUNDBITE) (English) DIRECTOR OF YUKOS INTERNATIONAL INFORMATION DEPARTMENT HUGO ERIKSSEN: "We will continue producing our oil, selling our oil, we will encourage a compromise, but with our bank accounts and assets frozen that will be increasingly difficult as time goes by. But we are very interested in finding an amicable solution that will allow us to pay our taxes, though we do dispute the legality of the claim." 1.02 9. EXTERIOR OF YUKOS BUILDING 1.13 Initials Script is copyright Reuters Limited. All rights reserved
  • Embargoed: 23rd July 2004 13:00
  • Keywords:
  • Location: MOSCOW, RUSSIA
  • Country: Russia
  • Reuters ID: LVAABUUK0IFAWGSC995USGVK7M2D
  • Story Text: Russia's YUKOS oil giant awaits bailiffs as tax
    deadline passes.


    Time ran out for Russia's largest oil firm YUKOS
    on Thursday (July 8) after failure to meet a 3.4 billion
    U.S. dollar tax deadline left the giant perhaps only hours
    away from a fire sale of assets.

    The deadline expired at midnight after eleventh-hour
    talks with the government proved fruitless and the company
    said it would not be able to pay the demand, which relates
    to 2000.

    Bailiffs can now arrive at any moment at the company's
    glass-fronted Moscow headquarters or its operations, which
    pump a fifth of Russia's crude oil.

    "We have no idea in respect what may happen today. The
    court bailiffs may come, they may not come, they may come
    to another location, we have no indication of what will
    happen," said Hugo Erikssen, director of YUKOS'
    international information department.

    YUKOS says it could collapse by the end of the year
    under a tax bill that has mushroomed to nearly 7 billion
    U.S. dollars. Analysts say that could rise to 10 billion
    U.S. dollars after audits of 2002 and 2003.

    The firm's future to a large extent depends on whether
    main shareholder Mikhail Khodorkovsky, and other core
    owners who control YUKOS through holding firm Menatep, can
    reach a settlement with the Kremlin.

    The politically ambitious Khodorkovsky is on trial for
    fraud and tax evasion and the charges against YUKOS are
    widely seen as part of a campaign against him by a Kremlin
    administration ill at ease with potential political
    opponents.

    Khodorkovsky's lawyer said on Wednesday (July 7) that
    he had offered from his jail cell to give up control in
    return for the company's salvation but there was no word
    from officials.

    President Vladimir Putin pledged last month that the
    government would do all it could to avoid the firm's
    collapse, but legal blows have continued to rain down on
    the firm. Even as the deadline approached, armed police raided
    the office which keeps its list of shareholders after
    officials said the registrar had failed to cooperate with
    bailiffs.

    A high-level YUKOS source said the company was in talks
    with officials on how to reach an amicable agreement and
    avoid bankruptcy.

    But a YUKOS spokesman denied talks were going on and
    said the government had not responded to attempts to strike
    a deal.

    Many Russians may cheer the potential collapse of a
    company whose shareholders amassed huge fortunes in shady
    privatisations while most of the population was thrown into
    poverty.

    But analysts say the selective bankruptcy of YUKOS
    could hurt everyone in a country banking on foreign
    investment to help double the size of the economy in this
    decade.




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