Belarus president Alexander Lukashenko has household connections to at the least two companies in Cyprus, as EU states put together to go after his cash.
The 2 Cypriot real-estate firms – Eastleigh Buying and selling and Dana Holdings – each have hyperlinks to the president’s daughter-in-law, Lilya Lukashenko, the spouse of his eldest son, Viktor.
And a more in-depth take a look at the companies shines gentle on the labyrinthine monetary ties between Nicosia and Minsk.
The Lukashenko title turned freshly poisonous after the president spent the final two months brutalising pro-democracy protesters, who got here out on the streets following Lukashenko’s election victory in August – a end result the EU refused to recognise.
And EU nations, together with Cyprus, agreed, on Monday (12 October), to freeze his monetary belongings in the event that they discovered any.
The Belarus disaster worsened the identical day, when Lukashenko’s deputy inside minister authorised police to make use of dwell ammunition in opposition to opposition teams.
And the EU sanctions may broaden additional in future to additionally cowl enterprise tycoons who enriched the Belarusian chief, an EU supply mentioned.
“The sanctions have a really broad authorized foundation and there are, actually, 1000’s of names we may add,” the supply famous.
For her half, Lilya Lukashenko was named as a director of Eastleigh Buying and selling by Vyacheslav Dudkin, a former anti-corruption chief in Belarus’ inside ministry, who fled the nation and spoke to Russian newspaper Kommersant in 2012.
Dudkin mentioned she and Eastleigh Buying and selling proprietor, Belarusian tycoon Vladimir Peftiev, had used the agency in fraudulent schemes.
And Peftiev was blacklisted in earlier EU sanctions in 2011 on grounds he was a “key monetary sponsor of the Lukashenko regime”.
Lilya Lukashenko at present runs an artwork gallery in a Dana Holdings group shopping center in Minsk.
However when requested by EUobserver if Lilya Lukashenko was an artist, Valery Tsepkalo, a number one Belarusian opposition determine, mentioned: “She’s an artist at earning money from him [Alexander Lukashenko] giving enormous concessions to his favoured companies”.
Eastleigh Buying and selling was nonetheless lively in 2019, in keeping with its Cypriot company recordsdata.
And its “principal actions” have been “that of a holding firm and the acquisition, reconstruction, and rendering of actual property in Belarus”, in keeping with a 2013 audit.
Its shares have been held “completely by non-residents” of Cyprus, the audit mentioned, and its administrators have been a Cypriot monetary providers agency known as Centaur, which doesn’t reply its telephones.
In the meantime, the Dana Holdings group has its HQ in Minsk and is run by two Serbs – Bojan and Nebojsa Karić – who’re scions of the Belgrade-based Karić enterprise dynasty, with which Alexander Lukashenko has had pleasant ties for years.
Lilya Lukashenko was additionally named as a “senior officer” in a Dana Holdings subsidiary, Dana Astra, in Belarusian financial records in 2017.
The group’s Cypriot subsidiary has not completed a lot enterprise these days, its recordsdata indicated, however Nebojsa Karić, who gave his handle as Palm Jumeirah in Dubai, the place Alexander Lukashenko ceaselessly visits, was certainly one of its main shareholders in 2019.
Dana Holdings acquired contracts to construct towers of luxurious flats in Lukashenko’s capital metropolis over the previous few years.
It additionally joined a listing of firms, seen on fliers posted in Minsk, voicing assist for him at a time when others have been happening strike in solidarity with protesters.
However it denies Belarus opposition accusations that it acquired undue favours from the pariah president.
“This declare is categorically false. Dana Holdings … obtained constructing permissions through open, aggressive processes, in strict accordance with Belarussian laws,” a spokesperson for Dana Holdings from its London-based PR agency, EM, informed this web site.
And it tried to distance itself from Lilya Lukashenko, saying she had been a mere designer and had not come again to work for Dana Astra after she went on maternity go away three years in the past.
The Minsk-Nicosia-Belgrade-Dubai connection sheds gentle on a few of the labyrinthine monetary flows between Belarus and the EU.
And Cyprus would have its work minimize out if it needed to actually delve into its Belarus monetary relations.
The small island, on paper, handles extra international funding in Belarus than some other EU nation.
The shut ties stem from a double-taxation treaty in 1998, which lets Belarusian companies profit from decrease Cypriot taxes through brass-plate subsidiaries.
And the perks see as much as €1bn a 12 months shifting forwards and backwards in good years, comparable to 2013, in keeping with Belarus’ official statistics.
Some main Belarusian firms have additionally invested in Cyprus.
Asbis, a Belarusian IT agency, which has revenues of €1.6bn in keeping with its annual report, has its world HQ within the Cypriot city of Limassol.
Wargaming Group, a Belarusian video-game firm valued at €1.3bn by the Bloomberg news agency, has its HQ in a glass tower within the Cypriot capital.
Wargaming Group has purchased the biggest chunk (20 p.c) of Cyprus’ second largest lender, Hellenic Financial institution, in keeping with Cypriot business media.
And at the least 19 Belarusians, together with businessmen and their households, additionally purchased Cypriot passports between 2017 and 2019, the Al Jazeera information company informed EUobserver, primarily based on leaked Cypriot recordsdata.
“Wargaming Group has change into very influential in Nicosia,” a former Cypriot central financial institution official informed EUobserver.
However for the Cypriot finance ministry, there was nothing untoward in regards to the state of affairs.
“The monetary flows from Cyprus to Belarus are restricted,” the ministry informed this web site.
“There are usually not some other Belarusian traders within the Cyprus banking system,” it added.
“It needs to be famous that Cyprus is a global enterprise providers and monetary centre with an in depth community of double-tax treaties. As that is the case, FDI [foreign direct investment] flows in the direction of different jurisdictions is a standard phenomenon,” it additionally mentioned.
The ministry declined to say if it knew of any Lukashenko-linked companies on its soil.
And it declined to say if it froze any Belarusian belongings the final time the EU imposed sanctions on individuals like Lukashenko and Peftiev between 2011 and 2016.
Lukashenko has salted away “greater than $1bn (€850m)” in his non-public fortune, Tsepkalo, who used to handle a enterprise park in Minsk earlier than he joined the opposition, estimated.
Tsepkalo urged EU nations to place strain on the regime by focusing on what he known as “firms which act as his [Lukashenko’s] private pockets”.
However it isn’t straightforward, even for EU officers, to pierce the opacities of the Belarusian constructions.
The final time round, Peftiev, as an illustration, received a landmark trial on the EU courtroom in Luxembourg in 2014, which mentioned the EU Council had failed to assemble sufficient proof for his itemizing.
And it isn’t straightforward for journalists to ask questions.
When EUobserver requested the place Peftiev now lived and if he was nonetheless concerned with Eastleigh Buying and selling, his Minsk-based legislation agency, Revera, declined to reply and threatened to sue this web site if it talked about his earlier EU asset-freeze.
“To … create a picture that contradicts the choices of the final courtroom of the EU is unsuitable, deceptive, and can trigger nice harm,” the legislation agency’s Dmitry Arkhipenko mentioned by e mail.
Peftiev and his spouse, Olga Makarenko, used to dwell in Malta and Olga Makarenko additionally created 12 firms within the British Virgin Islands whereas he was nonetheless underneath EU sanctions, in keeping with the so-called Panama Papers revelations.
However “we don’t entitle you to publish … any details about Mr Peftiev or his relations,” Arkhipenko mentioned.
“Mr Peftiev has not visited Belarus for a few years, doesn’t handle any enterprise – neither in Belarus, nor within the EU, doesn’t personal any shares of EU companies, and, in keeping with my data, he’s in the mean time writing books,” Arkhipenko additionally mentioned.