Government Does Not Specify What It Received in Exchange for the 'Expensive Gift' from ZPCM

The government does not detail what it received as a donation in exchange for 15% of the share capital of the Zangezur Copper-Molybdenum Combine (ZPCM).

On October 30, 24News reported that 'Zangezur Mining', whose beneficiary is also the former Minister of Health and Social Development of the Russian Federation, Mikhail Zurabov, has filed a lawsuit against the closed joint-stock company 'Zangezur Copper-Molybdenum Combine', the joint-stock company 'Industrial Company', and the Government of the Republic of Armenia, represented by the Prime Minister's Office, demanding the annulment of transactions. 'Zangezur Mining' has approached the general jurisdiction court of Syunik Province, demanding the annulment of the transaction for the acquisition of 60% of the shares of the combine conducted by Roman Trotsenko, a member of the board of directors of 'Geopromining' company, and the application of consequences related to the annulment. Zurabov owns 12.5% of the shares of ZPCM.

According to an official statement released by the government on October 1, 'Industrial Company' has donated 25% of its shares to the Government of Armenia. 'The Industrial Company' owns 60% of the Zangezur Copper-Molybdenum Combine (ZPCM). The 25% donated to the government corresponds to 15% of the total capital of ZPCM, thus passing to the ownership of the Republic of Armenia. 'Industrial Company' is affiliated with 'Geopromining Armenia', which acquired 60% of ZPCM on September 30, 2021.

As defendants in this case have been designated the Republic of Armenia represented by the Prime Minister's Office, 'Zangezur Copper-Molybdenum Combine' CJSC, and the Moscow-registered joint-stock company 'Industrial Company'. On November 2, 24News had sent an inquiry to the government regarding: 1. How does the government interpret this judicial process? 2. What is the reason for the government receiving 15% of the total capital of ZPCM?

In response to the first question, the government's Department of Information and Public Relations stated that Deputy Prime Minister Suren Papikyan provided a public clarification on this inquiry during a press briefing with journalists at ZPCM on October 25, during his visit to Syunik Province. Addressing the recent judicial process related to ZPCM, Papikyan stated that it 'certainly does not impede' the government’s activities. 'This is a working process. Now the partners who believe there are certain illegal actions have turned to the court, and naturally, the court will respond to them. I do not see anything extraordinary. We are confident that what has been done is legal, and we must defend our positions and the interests of the Republic of Armenia,' added the Deputy Prime Minister.

However, no detailed response was provided by the executive body regarding the second question. 'The donation of 15% of the share capital of Zangezur Copper-Molybdenum Combine to the government by the Industrial Company was made based on an appropriate contract, which stipulates that one party provides and the other accepts. The process is legal, and there are no other legal relations here,' the response stated. Essentially, the government has not indicated what it received in exchange for such an 'expensive gift.'

ZPCM has declined to provide any comment regarding this transaction and the judicial process, and no response has yet been received from the company that made the donation.