Wild Days: As Berezovsky and Abramovich Face Off in UK Court, the Case Sheds Light on the Politics of Old and New
file photoWhile at the center of the court case between Russian oligarchs Roman Abramovich and Boris Berezovsky lay an ownership dispute over shares in an oil company, its the background details that catch the eye. The case finally lays out facts in place of years of speculation about power and politics in Russia in the notoriously chaotic 1990s. Whats more, the case sheds light not only on the Boris Yeltsin era, but also on contemporary politics under Prime Minister Vladimir Putin.
file photoSince it began more than a month ago in Londons High Court, the case has grabbed headlines throughout international media. Berezovsky is suing Abramovich, his onetime business partner and close friend, over what he alleges to be Abramovichs bullying of Berezovksy out of his shares in the lucrative Sibneft, which Abramovich later sold to Gazprom for $13 billion in an historic sale. Berezovsky claims he was forced to sell his shares in the company for a grossly undervalued sum before he fled Russia for the UK in 2000. Abramovich, meanwhile, denies his former friend ever owned any part of the company.
Oligarch lawsuits such as this one frequently draw international attention, particularly because they almost exclusively take place outside of Russia (and, at that, often in London). The irony is that the legal system in Russia, the country where they made the lions share of their wealth, is simply too unreliable and suspect to political machinations, especially when, as in the Berezovsky-Abramovich case, about $6.5 billion is at stake.
But the most intriguing part of the case is not the airing of dirty laundry by high profile, well-dressed playboys who own football teams or villas in the Western Europe. Instead, its one of the few occasions when the crony capitalist politics of Russia have been laid bare. As the oligarchs trade blows and accusations against one another, observers in both Russia and the West are finally privy to the facts which, until now, were long the subject of intense speculation that provide credence to the shady business climate and the confluence of money, power and politics during the wild 1990s.
Abramovichs 101-page written testimony, presented recently to the London court, details the rise of his business, his association with and reliance upon Berezovsky, as well as the dubious relation between business and politics at the time. He candidly describes how Berezovsky played a key role in providing him krysha or political protection for which, in exchange, he received hundreds of millions of dollars worth of chartered jets, country estates and various other luxuries. Whats more, he detailed how Berezovsky leveraged his political influence to convince former President Boris Yeltsin to merge two state assets a Siberian oil field and a refinery in Omsk and sell them in a rigged auction to Abramovich. Shortly thereafter, Sibneft, one of the most profitable Russian oil companies, was born.
At the time, to [build a lucrative business] in Russia was impossible without the aid of a person who had the necessary political connections, said Abramovich in the statement, parts of which have been published in the Vlast magazine. In addition, it was necessary to also have physical protection, since everyone who had access to companies that could bring in a lot of money suffered from criminal attacks, including the possibility of violence. My relationship with Berezovskycan be characterized as a relationship with someone with political connections, the use of which could solve issues in exchange for monetary compensation.
Experts said the affair, by providing a window into the crooked dealings of the 1990s, serves to delegitimize many of the business interests accumulated during the era. Moreover, Pavel Salin, an analyst at the Center for Political Assessments, points to the contrasts between the state-initiated media campaign against oligarchs in the early 2000s and the information uncovered from the current court case, claiming the facts are more credible now than ever before. Theres one important nuance: people understood that the sources of [the media campaign] were not other oligarchs, but their opponents in the state bureaucracy who were taking revenge, he said. Now, were being told these very same facts, but by the oligarchs themselves, and its much harder to accuse an oligarch than an enemy of an oligarch of lying.
The case also helps uncover the facts of Russias transition from crony to state capitalism, as well as Putins own rise to power. As the hearings drag on and testimonies are collected, more high profile witnesses are being pulled in to corroborate the facts. Aleksandr Voloshin, Putins former chief of staff, gave his testimony on November 14, in which he claimed that Berezovsky used his TV channel at the time, ORT (now Channel One), to attack the Kremlins mishandling of the 2000 sinking of the submarine Kursk. He added that the final nail in the coffin in the relationship between Berezovsky and the Kremlin took place in an August 2000 meeting, when Putin allegedly told the oligarch that the show is over.
According to Berezovksys account, Abramovich, on behalf of the Kremlin, pressured him to sell his shares in ORT also a subject of the lawsuit before fleeing to the UK. Berezovsky also alleged earlier that Abramovich betrayed his former mentor in order to remain in Putins favor and gain access to other choice privileges such as the record $13 billion sale of Sibneft to Gazprom in 2005.
Other experts argue that the facts of the case, which seemingly overlap two different political eras of post-Soviet Russia, cement in the minds of Western observers a certain continuity between the 1990s and today. It will be difficult for the British court to decide whether Russia under Boris Yeltsin was good or bad, and whether Vladimir Putin continued on the same course as the first Russian president or served as his grave-digger, said political commentator Konstantin von Eggert on Kommersant FM. [For the West,] the 1990s cannot be separated from todays era, and those who are in power today are fully responsible for what happened ten, 15 years ago. And no one will be able to escape this historical responsibility neither the plaintiff, the defendant, nor anyone who is mentioned in the court.
