People often ask me: what percentage of such-and-such company do you own? I used to be unable to answer that question. Now I can, at least when it comes to Russia’s largest oil company — OJSC Rosneft. I own 0.00000326% of the shares. Rosneft itself calculated that. As you may recall, some time ago we smacked Rosneft around in the Arbitration Court, which made the only lawful decision possible: Rosneft is obliged to provide its shareholder with copies of the board of directors’ minutes. That follows directly from the law "On Joint-Stock Companies." Rosneft, of course, provided no documents, puffed itself up, and said it would appeal the ruling. Well, it has. We have received the text of its appeal. It is something else. In America, in cases like this, they say, "Oh my goodness." What people say in Russia in such cases, you’re about to understand for yourselves. Rosneft, a huge company employing hundreds of lawyers, is seriously claiming that Shareholders come in large, small, and insignificant varieties. And their rights are correspondingly large, small, or insignificant. but the real trashiest part is that Rosneft has decided to prove in court that "A. A. Navalny is not an ordinary shareholder." Not on some kompromat website, but in an appeal against an Arbitration Court ruling, they quote a Wikipedia article (!!!) about me bring up the YABLOKO party, the NAROD movement, and the Committee for the Defense of Muscovites scold me for "skipping" the shareholders’ meeting quote the "statements of journalist Oleg Kashin" (!!!!) about me (kashin, hi there) state that I stage "show trials" (yes, yes, the poor dears suffer so much from my judicial terror) mention with disapproval the "blockbuster in Forbes magazine" accuse me of regularly appearing in the pages of Vedomosti, Kommersant, Novaya Gazeta, Forbes, etc. say that I am "abusing my right to judicial protection" (!!!) So basically, the idea is that I’m not really a shareholder at all, but a villain. And since this shareholder is a villain, he is not entitled to receive documents. The full text of this work of genius is here. For those too lazy to read the whole pile of nonsense, here are a few choice excerpts for your amusement:
If you’re not a Rosneft shareholder, this is funny. But I am a shareholder, and I find it depressing. Because an enormous oil company — effectively a state oil company — is wasting its time on this kind of nonsense. They keep a hundred million lawyers in suits on the shareholders’ dime, only for this legal army to produce such pathetic drivel: they go to arbitration court to complain that I am staging "show trials." Here:
This lady, Larisa Kalanda, is the chief inspiration behind this legal gibberish with its references to Wikipedia. She’s quite remarkable: not only does she oversee legal work at Rosneft, she also heads Rosneftegaz, a strange outfit that is the formal owner of the state’s shareholdings in Rosneft, Gazprom, and so on.
The lady’s husband — an energetic gentleman and former FSB general — works as first deputy at the Federal Drug Control Service and has a reputation as an outstanding lobbyist (or perhaps I should call him a "pusher," given that he’s from the drug control agency). So yes, it’s quite the family contracting operation. The two-man saw reaches far. Well, all right, to hell with the Kalandas — let them run their family business. I know this post will be pored over at Rosneft, so I have a few questions: For Peter O’Brien, our transparent foreign citizen and Rosneft vice president. Every time Peter sees me, he looks at me very sympathetically and says: Alexei, they still haven’t given you the minutes? Tut-tut! That’s terrible. I’ll ask them to speed up the process.
Petruccio, what’s up? I notice you are enjoying being a bad Russian guy. Just remember, you have the Bribery Act in your home country. For the new Rosneft president, Eduard Khudainatov.
- Eduard, was it you personally who decided to introduce such wonderful — and in some ways even innovative — methods of dealing with shareholders? What prompted you to do this? Are you frightened by "show trials"? 3. For Standard & Poor’s, which year after year gives Rosneft top marks in its corporate transparency rankings.
My friends, I don’t know what exactly is going on with your ranking methodology, but the fact that a company has officially refused to provide a shareholder with documents he is legally entitled to, on the grounds that he is "small" and "bad," is something you will have to take into account somehow. Expect a letter from me. And finally, to the country’s chief oil-and-gas strongman and chairman of Rosneft’s board of directors, Igor Sechin.
Igor Ivanovich, please make up your mind. Otherwise it looks like schizophrenia. Inter RAO UES, where you also chair the board, gave me the minutes after signing a confidentiality agreement. Gazprom gave them to me with no conditions at all. Even Surgutneftegas — shabby as they are — handed them over. Everyone did, and nothing happened. The sky did not fall to earth. But Rosneft refuses, citing Wikipedia, journalist Kashin, and my absence from the general shareholders’ meeting. There needs to be some consistency here. And as for the Kalanda spouses, please issue them mittens, company-logo hard hats, mosquito spray, and send them off to develop the Vankor oil field. Energetic and enterprising people are needed there. So there you have it. I’ll add that today the newspaper Vedomosti is also writing about this:
Rosneft Doesn’t Sweat the Small Stuff Companies should not have to disclose current operating information to small shareholders, and Alexei Navalny is abusing his right to information — that is what Rosneft will try to prove in court. The state-owned company has appealed a court ruling ordering it to provide documents to Navalny, who owns 0.00000326% of its shares. The Ninth Arbitration Court of Appeal accepted the complaint for consideration on Monday, according to its website. Read the full article
And I will gladly translate this marvelous document — a perfect illustration of Rosneft’s attitude toward shareholders — into English and, with a cover letter, send it to all of Rosneft’s foreign shareholders, ADR/GDR holders, investment banks, mutual funds, and so on. They’re small shareholders too. I’m sure they’ll find it interesting.