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| Gazprom pipeline: for years foreign investors have got around restrictions on owning shares in the Russian gas company through grey trading schemes. News of a crackdown hit its share price |
Foreign investment sentiment was already being battered by the Yukos affair, the Kremlin's attack on what was Russia's biggest oil company. However, waning confidence was dealt a fresh blow in August when a Duma deputy officially called for an investigation into ?grey? schemes used by foreigners to hold billions of dollars-worth of Gazprom shares.
On August 17 the legislator, Yuri Savelyev from the Rodina (Motherland) party, sent a letter to head of the federal security service (FSB) Nikolay Patrushev, interior minister Rashid Nurgaliyev and prosecutor-general Vladimir Ustinov. It accused Russian investment bank United Financial Group (UFG) of running, ?a scheme under which anonymous foreign companies and individuals can own shares in Gazprom, bypassing a 1997 presidential decree that bans the ownership of Gazprom shares by foreign companies and individuals or Russian companies with more than 50% foreign capital?.
Gazprom's share price immediately plunged 12.5%, wiping more than $6 billion off the company's market capitalization in a day as investors ran for cover, fearing that the Kremlin was about to launch a crackdown on the schemes and confiscate their money.