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. Last Updated: 07/27/2016

Chamber Recognizes Victorious Tax Fight

The American Chamber of Commerce in Russia dished out a slew of awards at its second annual dinner, including recognition of one businessman who took on the Russian tax authorities -- and won.


John Bailey of Johnson & Johnson in Moscow won the chamber's "Unique Achievement Award" on Saturday for triumphing in two court battles that members said would have cost the personal hygiene division of Procter & Gamble $7 million had it lost.


One American businessman said the case "brought together the business community, the diplomatic community and the American Chamber of Commerce to solve the problem of an American business." Johnson & Johnson had threatened to leave Russia if it had to pay the penalties, said the executive, who asked not to be named.


Bailey declined to comment Monday on the award or details of the case, and chamber and U.S. Embassy officials involved were tight-lipped.


"We served as a conduit between Chubais and Johnson & Johnson," said Peter Charow, executive director of the chamber, referring to former first deputy prime minister for economic policy Anatoly Chubais.


"The American embassy wrote a letter to the Russian government," added the first American businessman. "Chubais was told to straighten it out."


The businessman said Russian tax authorities first brought the case against Johnson & Johnson, centering on "a disagreement over what constituted charter capital," to a Moscow court. After losing the first round, the tax inspectorate brought the case to a Russian federal court, where it lost again, he said.


It was not clear at what point any intercession from Chubais might have occurred. Russian tax and court officials reached Monday said they had no information about the case.


"This sort of thing has happened before but it is very unusual," said a second American businessman, who asked not to be named. "I think this case shows that there are mechanisms available" to U.S. businesses in Russia.


The chamber, which represents some 250 companies, presented a number of other awards at the dinner Saturday night at Moscow's Aerostar hotel.


Coca-Cola was named "Company of the Year" and its Russia head, Michael O'Neill, "Chamber Person of the Year."


Julie Rasmussen, president of Mary Kay Cosmetics, was recognized as "Businessperson of the Year," while the "Small Business of the Year" award went to Direct Net Telecommunications.


Financial consultant Lauralee Raddatz and Michael Forman of MicroAge Computers were named committee chairs of the year for their work on the small-business and information technology committees, respectively.


Thomas Pickering, U.S. ambassador to Russia, was honored as a "Special Friend to the AmCham."