“Russian trace” and searches in the AMC: in Ukraine, the scandal is gaining momentum with the tobacco monopoly

This morning the staff of the General Prosecutor of Ukraine (GPU) appeared suddenly with searches in the Antimonopoly Committee of Ukraine (AMCU). The monopolists seize documents. As reported “Today” in the AMC, the demonstrations according to the decision of Pechersky court of Kiev and associated with the so-called “affair “Tedis” – the monopolist-distributor of the tobacco market of Ukraine. The same information is confirmed by the General Prosecutor of Ukraine Yury Lutsenko.

The website “Today” to figure out what’s going on in a loud “tobacco”, as it is associated with the Antimonopoly Committee and what consequences threaten the entire cigarette market in Ukraine.

That “Tedis”?

“Tedis-Ukraine” (earlier “Metropolis”) – a distributor of tobacco products in Ukraine. The company is in the TOP 20 largest in Ukraine and full control of the market distribution of tobacco products. For many years the company has collaborated with international manufacturers of tobacco products: JapanTobacco International, Philip Morris International, Imperial Tobacco Group, British American Tobacco, as well as with suppliers of lighters FireTime and Ringo Ltd. In 2014 and 2015, 100% made in Ukraine cigarettes were implemented “Tedis”.

In December 2016, the AMCU has fined the “Tedis” 431 million UAH for abuse of monopoly – the claim was to the pricing. In addition, according to AMC, “Tedis” partially refused to sell the product in the absence of alternative sellers.

Now charges more serious than the company suspected of tax evasion and the illegal withdrawal of billions of hryvnia abroad, including to Finance terrorism.

March 31, thousands of law enforcement officers under the procedural guidance of the Military Prosecutor’s office launched investigations (primarily search and seizure operations) associated with the company “Tedis-Ukraine”.

In the office of the “Tedis” also were searched. In the investigation involved thousands of law enforcement officers from the GPU, the Military Prosecutor’s office of Ukraine. Searched apartments linked to a group of people, a fictitious company,”satellites”, and government agencies.

Searches. Photo: Arsen Avakov / Facebook

“This morning, thousands of law enforcement officers under the procedural leadership of the Military Prosecutor’s office on the investigation materials of Department of counteraction in the sphere of economy launched investigations (primarily search and seizure operations) associated with the company “Tedis-Ukraine”, which is also known as “Megapolis-Ukraine” (the name change happened recently)”, – reported the Prosecutor General of Ukraine Yuriy Lutsenko. He said that only happens about 100 searches for all companies associated with the “Tedis” or “Megapolis-Ukraine”, as well as in the AMC.

While in the “Tedis-Ukraine” deny all allegations of the Prosecutor General on the evasion of taxes in especially large sizes, as well as the withdrawal of billions of hryvnia from the country.

Until the investigation is continuing.

“Russian trace”

Investigators have established that a Moscow law firm was actually in charge of all actions of the “Tedis”, including financial.

“There were decisions made, in what amount and when to withdraw money from Ukraine. We are now interested in ending this financial fountain that illegally withdraw money from Ukraine, part of which could go to funding the supply of weapons to terrorist organizations,” – said Lutsenko.

Photo: Arsen Avakov / Facebook

The state office of public Prosecutor during pre-trial investigation also found that the company is run by Russian oligarch Igor Kesaev.

“Under the influence Kesaeva in key positions in the “Tedis” designated person that all of their decisions in consultation with a member of the Board of Directors of the Russian JSC “Degtyarev Plant” – one of the suppliers of weapons to terrorist organizations “DNR/LNR”. Despite the ban, the national security Council and the NBU, via accounts of firms-transit countries for 2015-2017 receive 2.5 billion UAH”, – said the Prosecutor General.

To Kesaeva, by the way, sanctions which prohibit the withdrawal of funds from Ukraine abroad.

“In connection with [activities of the plant. Degtyareva] of the national security Council and the NBU with the 2014 year imposed sanctions against a citizen Kesaeva in the form of prohibition on withdrawal of capital companies, where he is the founder or the beneficiary in the territory of Ukraine. Despite this prohibition, through a series of financial and economic structures and firms transit to the Russian Federation for the period of 2015 year of legalized and receive UAH 2.5 billion. Part of them, according to investigators, was funded by the arming of terrorist organizations “LNR” and “DNR” – said Lutsenko.

According to the GPU, now Kesaev is located on the territory of the Russian Federation. “So we have no contact with him. The purpose of today’s searches is receipt of documents on which basis will be formed suspicions – suspicions against all those who violated our laws, thus waiting on the financing of terrorism. We are talking about the leadership of the “Tedis-Ukraine” and representatives of government agencies that were supposed to prevent monopolies,” – said Lutsenko.

Distributor he said that among the direct or indirect owners of the “Tedis-Ukraine” no Russian companies or Russian citizens. “The owners of the TEDIS Ukraine are individuals – citizens of Ukraine, Ireland and the UK,” said the company.

What’s the ACU?

The task of the Antimonopoly Committee is to ensure state protection of competition in entrepreneurial activities. The AMC in this regard is regulation of monopolies – ensures that the market functioned normally and without “bias”.

The “reality “of the Tedis”, according to the Prosecutor General’s office would be involved and the competition authority. As reported, Lutsenko, tobacco distributor “received assistance from separate state agencies.” That is, the AMC is suspected of promoting monopoly “Tedis” tobacco market”.

“In the Antimonopoly Committee in the morning before the start of the day without the use of special forces came investigators for the seizure of documents testifying to the accompanying monopoly position and non-statutory actions of the leadership of the AMC. The fact that a number of other Ukrainian companies which wish to engage in the distribution of tobacco products, has applied to the ACU to force manufacturers to break the monopoly and to cooperate with other distributors. Despite its obligations under the law, the AMCU leadership has not taken such measures on demonopolization of the market than according to the investigation, was accompanied by the establishment of monopolies of the company “Tedis-Ukraine”, – said Yuri Lutsenko.

The attorney General is confident that the AMC should not be limited to fines and accepting actions against manufacturers of tobacco products, “to get them to destroy monopoly and to provide the products to other distribution companies”.

Photo: Arsen Avakov / Facebook

The Minister of internal Affairs of Ukraine Arsen Avakov has even called for the resignation of the leadership of the Antimonopoly Committee in connection with the situation around the “Tedis”.

“At work today in the Antimonopoly Committee is missing its head (Yuri – Ed.) Terentyev – he’s in some kind of departure. His Deputy, (Nina – Ed.) Sidorenko, who was in the business of “Metropolis” and “Tedis”, today, too suddenly on a business trip. Another Deputy is on vacation. I think a vacation for these people needs to be extended. The result of this inquiry the society and we are entitled to demand the resignation of the leadership of the AMC. … Antimonopoly Committee is the structure that needs to investigate or prevent a monopoly position. Long time for one reason or another, check the AMC did not see any problems here”, – said Avakov.

The AMC confirms that the head and two deputies is not in the Committee in connection with stay in travel/vacation, but with the “business “Tedis” is not connected. At the moment, the acting head of the AMCU takes Andrew M. Volk.

According to the public Prosecutor of Ukraine Yury Lutsenko, the heads of the Antimonopoly Committee at the moment are on the territory of Ukraine, and the reasons for the issuance of the suspicion in committing a crime yet.

What’s next?

The tobacco situation has not commented, but experts believe that the scandal with the company “Tedis-Ukraine” will hardly affect the smokers although cigarette prices still can grow.

“The situation around the “Tedis” is redistribution. It’s all very simple. “Tedis” good money on cigarettes. People close to power, I just want to take control of the structure. Eliminating this monopoly, they put their. Collapse will not occur. Smokers are at a problem will not feel. But may increase the average price of cigarettes. Suddenly the new distributor will set prices higher,” – said the President Ukranalittsentra Alexander Ohrimenko.

“Tedis-Ukraine” can be nationalized, experts say.

In addition, there is a risk of nationalization, monopoly, head of the Department of control over tobacco of the Ukrainian Institute for strategic research of the Ministry of health Konstantin Krasovsky.

“Can be two options. On the one hand, searches can no be completed. On the other – the government can go on a radical step and nationalize “Tedis”. Then in Ukraine on the example of Hungary is a state-owned company controlling the entire market of cigarettes. The tobacco companies absolutely do not like this step. Now they do not sell cigarettes, except for “Tedis”. It is known that the distributor previously lobbied for their interests to establish minimum excise duties on cigarettes,” said Krasovsky.