DCH group of Aleksandr Yaroslavskyi posted information about the legal position of DCH on issues related to PJSC ‘Motor Sich’ on its official website today. Earlier, Mr Yaroslavskyi has repeatedly confirmed his interest in acquiring large-scale industrial enterprises, and together with Chinese investors of PJSC ‘Motor Sich’ applied for the equity concentration to the Antimonopoly Committee of Ukraine last week.
As it is known, the acquisition of shares of ‘Motor Sich’ by Chinese investors was blocked by the actions of the Antimonopoly Committee of Ukraine and the Security Service of Ukraine under the previous government since 2017. Subsequently, the issue of a joint application of Skyrizon, the Chinese company-shareholder, and the State Concern ‘UkrOboronProm’ was considered, but the agreement was never implemented before its expiration, and the management of the concern called the issue no longer relevant. The Chinese investors of ‘Motor Sich’ say about their intention to ‘we are able to take off the project on the right foot with DCH’s involvement’ as follows.
‘We are confident we can deliver a prosperous, profitable and viable Motor Sich with all its energy and potentials. We absolutely support the statement of the owner and president of DCH Alexander Yaroslavskyi as far as we know him as a man, who is sincerely and unconditionally devoted to the interests of Ukraine,’ stated in the information of Skyrizon Board of Directors.
Also, the company’s management announces its readiness to use all legal means to protect their investments in the national and international legal field.
In this regard, in the announcement of the legal position of DCH motivated why the Antimonopoly Committee of Ukraine has no legal grounds to refuse permission to concentrate PJSC ‘Motor Sich’ shares either to the Chinese investors of the enterprise or to the DCH group.
‘Theoretically, only two characteristics of a transaction to acquire corporate rights could serve as legal grounds for such a line of actions taken by the AMCU.
First is that the transaction leads to monopolization or significant restriction of competition in the Ukrainian market, as stated in Article 25 of the Law of Ukraine ‘On Protection of Economic Competition’.
Second is that the deal involves companies that are included in the sanctions lists of Ukraine, as stated in Article 24 of the Law of Ukraine ‘On the Protection of Economic Competition.’ Neither the first nor the second criteria fit our joint application with our Chinese partners for the equity concentration of ‘Motor Sich,’ DCH states.
They also remind that the AMCU is obliged to respond to the application within a period of time from 45 calendar days to 3 months, but in any case no later than 135 days from the date of the announcement of the opening case according to the current legislation.
Let us recall that in the statement of Aleksandr Yaroslavskyi made public a few days ago, referred to the pressure of the security forces on the AMCU officials in order to prevent them from giving permission for the concentration requested by Skyrizon and DCH.
DCH considers the arrests imposed on the shares of ‘Motor Sich’ by the court and the Prosecutor General's Office of Ukraine as forceful pressure on business, which violates the rights of all shareholders of the company without exception, not just Skyrizon and DCH.
‘There is a ban on re-registration of shares and issuance of a register of shareholders in respect of all 100% of shares as a result of the arrests. This means that the owners of PJSC “Motor Sich” shares have been unable to dispose of their property for 3 years already, can’t take part in the management of the enterprise and control the compliance of those taken by the management. All court decisions on the imposition of arrests were made in violation of the requirements of the criminal procedural legislation, in the absence of proper verification of the circumstances declared by the prosecution and without examining the reasonableness of such a security measure. The business of the enterprise is paralyzed. There is no possibility to restore stable work and attract new investments. Therefore, the arrest of shares not only does not “contribute to ensuring the safety of property,” but, on the contrary, consistently leads “Motor Sich” to destruction,’ the group's website says.
Lawyers remind that all parties to the transaction, for the approval of which DCH and its Chinese partners have now applied to the AMCU, are private companies: PJSC ‘Motor Sich’ is not included in the list of state property objects of strategic importance for the economy and security of the state in accordance with the Resolution of the Cabinet of Ministers of Ukraine No. 83 dated March 4, 2015, and it was not included in the state strategy for the development of the aircraft industry.’
And they state that ‘such a context of events gives the shareholders of PJSC “Motor Sich” every reason to consider the actions of Ukrainian law enforcement agencies as pressure on business and appeal to international judicial institutions in order to put an end to this outrageous arbitrariness and restore their violated rights. ‘If turning to international arbitration, the state of Ukraine will be forced to compensate the losses and incur colossal reputational losses. Therefore, we hope that in the future our state will refrain from any form of illegitimate behaviour of state authorities (the AMCU, etc.), which would not meet international standards for the treatment of foreign investors,’ the statement summarizes.
In conclusion, DCH emphasizes the strategic interest in the development of ‘Motor Sich’ in Ukraine and the financial solvency of the group saying, ‘We have sufficient financial capabilities to carry out the equity concentration in the enterprise without attracting external funding, and we will independently exercise full corporate control in the long term.’
Just like the Chinese investors of ‘Motor Sich’, DCH separately notes in its today's statement its readiness ‘to use all legal measures to protect both our investments and the investments of our Chinese partners in PJSC ‘Motor Sich.’
