Tsarukyan's Response to Ararat Mirzoyan

The president of the Prosperous Armenia Party, Gagik Tsarukyan's press secretary Iveta Tonoyan has released Tsarukyan's response to the Chairman of the National Assembly Ararat Mirzoyan. It should be noted that Mirzoyan expressed concerns on his social media page days ago about the suspicions raised among a wide segment of the public regarding Tsarukyan's engagement in entrepreneurial activities, even though the Constitution and laws prohibit a member of the National Assembly from personally engaging in entrepreneurial activities.

Tsarukyan's response particularly states:

“Dear Mr. Mirzoyan,

Recently, you expressed concern in your writing regarding the question raised about my supposed engagement in entrepreneurial activities. I hope the facts presented will fully dispel all kinds of doubts and concerns that have been voiced previously.

First, let us note that the definition of incompatibility requirements for a parliamentary mandate is not arbitrary. Such requirements primarily aim to keep a member of parliament from being overloaded with other issues. In turn, the requirement prohibiting a parliament member from engaging in entrepreneurial activities is aimed at ensuring that the member’s status is not used to the benefit of their economic interests. Many countries have established compatibility requirements in their legislation, and the Republic of Armenia's legislation is no exception. Given that the raised issue relates to a violation of the requirement not to engage in entrepreneurial activities, I present the following facts regarding this.

From the moment the prohibition of a parliament member engaging in entrepreneurial activities was enshrined in legislation, I transferred my shares in commercial organizations to fiduciary management (in accordance with Article 2, Part 2, Point 3 of the Law on the Guarantees of the Activity of Members of the National Assembly of the Republic of Armenia). Currently, my shares remain under fiduciary management (the latest fiduciary management agreement was signed on May 20, 2017, for a period of five years).
Let us note that transferring assets (property rights) to fiduciary management does not transfer ownership rights (Articles 163 and 954 of the RA Civil Code), and the fiduciary manager is obliged to manage the property for the benefit of the founder. That is, after transferring the property to fiduciary management, the owner retains the right to receive dividends.
Your letter does not substantively mention my statements that gave rise to the assumption of my personally engaging in entrepreneurial activities; however, judging by the publications in the press and the letter from the secretary of the executive body of the 'Citizen’s Decision' party, you may have meant my statements as follows:

That I instructed to reduce the sale price of cement by 10,000 AMD. I made this statement as the first step in the declared economic revolution in the country, meaning that I refuse from the profit expected from cement production or, in other words, I accept the consequences of production loss, which is the owner’s right. In other words, this statement cannot be equated with the act of personally engaging in entrepreneurial activities.
That I announced a meeting with investors. Investment policy has been declared as one of the main directions of the Armenian government’s economic policy. The Prosperous Armenia Party has always declared its readiness to facilitate and support the implementation of investment policy. As the party leader, I have continually served my entire reputation, acquired over the years abroad, for the purpose of increasing investment volumes in our country and attracting foreign investors. In this process, numerous foreign investors have met with me to familiarize themselves with our country’s investment environment and key sectors and have valued my opinion. Moreover, many investors see me as a reliable guarantor for their investments, a trust that has been built over years of honest and successful activity.
That I made statements regarding the results of the activities of my companies transferred to fiduciary management in the first person. These statements merely reflect my awareness of the operational results of the organizations, which, even at a minimum, has no connection with the act of personally engaging in entrepreneurial activities. My meeting with the workers of the Ararat cement plant took place after the public demand of over a thousand workers, when they were not satisfied with the explanations and justifications provided by the management of the plant and the fiduciary manager. I held this meeting in the capacity of an owner, during which I made a decision that was not in the interest of the owner, conflicting with the board of directors' decisions, assuming responsibility for potential significant damages. Was this decision aimed at improving my or the plant's property status? Of course not; this decision was yet another expression of humanitarianism exclusively.

The concern mentioned in your letter about the conflict of interest for the deputy is probably related to my statement on the issue of the import duty on clinker. It is known that the Ararat cement plant is not the only cement producer in the republic, and my position was not aimed at improving the property status of 'Araratcement.' It is no secret that the discussion on the import duty for clinker was preceded by public discontent from over a thousand workers of 'Araratcement' regarding the issue of job cuts. Under such circumstances, under the provisions of Article 4, Part 5 of the Law on the Guarantees of the Activity of Members of the National Assembly of the Republic of Armenia, my position could reasonably not be interpreted as being driven by personal interests, as the issue affects an entire city and broader sectors of society.
In conclusion on the adherence to the requirements of incompatibility of the parliamentary mandate, I declare that I hold no position in any of the commercial organizations I founded, nor do I personally participate in the management of any of these. Therefore, I express my disagreement with your assessments regarding the raised issue formed by the expression 'fair concerns and reasonable doubts,' as well as your hint regarding the direct management of the enterprise transferred to fiduciary management through 'hidden mechanisms.'

From the perspective of relevance to the raised issue, I emphasize the inadmissibility of equating Gagik Tsarukyan as the leader of a political force, Gagik Tsarukyan as a deputy, and Gagik Tsarukyan as an owner. Each of the listed statuses of mine is regulated by law and complies with the letter and spirit of the law. I have never availed myself of 'hidden mechanisms' of management, as my activities have always been public, transparent, and visible; I have never had any issue of concealing or covering up from the state and the people, nor do I have it now.

I share your opinion on the need to define and clarify the legal mechanisms for separating political and entrepreneurial activities in the future. Both I and the parliamentary group of the Prosperous Armenia party are ready to make every effort to study global experience and develop an appropriate legislative package.

The management results of my enterprises under fiduciary management and my awareness of the business environment of the country do not leave many at ease, and attempts are being made to link this fact with the alleged engagement in entrepreneurial activities. These facts testify that the issue raised is artificial and aims to at least cast a shadow on my reputation and standing. Throughout my entire activity, by putting my personal interests aside, I have prioritized and continue to prioritize serving the interests of our country and state, every soldier standing on the front line, the security of Artsakh, the residents of disaster-stricken areas, and the interests of the entire Armenian nation—from builders to intellectuals and students to farmers.

For years, I have exclusively used my personal connections and reputation for the economic development and strengthening of the Republic of Armenia. As always, today too, I am ready to bear this heavy burden, having the vision of creating a Prosperous Armenia ahead of me.

The political force I lead in the National Assembly, the Prosperous Armenia party, represents the collective will and desires of thousands of voters, has been and will continue to be the voice of the people in parliament. We will consistently continue to act in the interests of our voters, our people, and the Republic of Armenia.

Dear Mr. Mirzoyan, I hope that the comprehensive justifications I have presented will forever dispel the doubts of all interested persons and organizations 'concerned' about this issue.

God bless us all.

Respectfully, Gagik Tsarukyan