The European Union (E.U.), as part of its sixth sanctions package against Russia and Belarus adopted on June 3, added EuroChem Group AG’s main beneficiary Aleksandra Melnichenko to its list of sanctions against Russia (GM June 3, p. 1), according to the E.U.’s Official Journal, published on June 3.
Melnichenko became the new beneficiary of the trust holding the controlling 90% stake in EuroChem in May (GM May 27, p. 29). Her husband, Russian billionaire Andrey Melnichenko, withdrew as main beneficiary of the group and resigned his position as Non-Executive Director following his inclusion on the E.U.’s expanded sanctions list in March (GM March 11, p. 1).
The E.U.’s decision to sanction Aleksandra Melnichenko puts into question whether Switzerland and Belgium will reverse their recent decisions to lift sanctions on EuroChem.
Certainly, Switzerland’s Federal Council is reported to have adopted the E.U.’s sixth sanctions package, and the country’s Federal Department of Economic Affairs, Education, and Research (EAER) also approved the sanctioning of over 100 further Russian and Belarusian individuals and entities.
According to a Bloomberg report on June 10, Switzerland’s list of sanctioned individuals and entities is identical to that of the E.U.
The Swiss government lifted its sanctions on the Zug-headquartered group following the ownership change, according to an Interfax report, citing Swiss newspaper Tages-Anzeiger.
In line with the charter of Switzerland’s State Secretariat for Economic Affairs (SECO), the organization responsible for monitoring sanctions against Russia, EuroChem’ s bank accounts and payments were unfrozen following the lifting of sanctions.
Swiss banks UBS and Credit Suisse temporarily froze EuroChem’s accounts in March after Andrey Melnichenko was put on Switzerland’s sanctions list.
Following the ownership change, the Belgian government around May 24 allowed EuroChem’s Antwerp plant to restart production, and also for the plant to buy raw materials (GM May 27, p. 29).
A representative for the Melnichenko couple described the E.U. decision to extend sanctions to include Aleksandra as “irrational” because she has never held Russian citizenship or resided in Russia, according to a Reuters report, citing an emailed statement from the representative.
Aleksandra Melnichenko, who was born in Belgrade, Serbia, and holds Serbian and Croatian citizenship, will “vigorously contest the unfortunate decision against her,” according to the report.
Meanwhile, EuroChem has announced the resignation of Kuzma Marchuk as Chief Financial Officer, effective June 1. Marchuk has also resigned from his positions on the group’s Board of Directors.