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. Last Updated: 07/27/2016

Business in Brief

Foreign Banks' Access

MOSCOW (AP) -- The Finance Ministry has drafted legislation giving foreign banks greater access to the Russian banking sector, Interfax reported Friday.

The proposed amendments to the country's banking law would allow foreign banks to acquire up to 10 percent of shares or stakes in the charter capital of a Russian lending institution without government permission, Interfax said.

It was not immediately clear when the government might submit the legislation to parliament.

During the first nine months of this year, the number of Russian banks with foreign capital grew by three to 129 and the number of banks fully controlled by nonresidents grew from five to 28, the report said.

Iraq Oil Deal 'Reserved'

MOSCOW (MT) -- Despite scrapping a contract with LUKoil to develop the West Qurna 2 oil field, Iraq considers it Russia's, a top Iraqi oil ministry official said in Cairo on Saturday, Agence France Presse reported.

"The West Qurna field is reserved for the Russians by a decision of the Iraqi leadership, not for any Russian company in particular but for the Russian government," the ministry's first undersecretary Hussein Suleiman told AFP.

"Moscow has the right to propose that [another] Russian company to develop this field," Suleiman said on the sidelines of an Arab oil ministers' meeting here. The official denied a report that LUKoil had lost the contract after Baghdad discovered it had been in contact with the Iraqi opposition, AFP reported.

"The Russian government had in 1997 proposed to LUKoil to work according to a precise timetable, but this company did not conduct activities during the period of the embargo, contrary to the terms of the contract," Suleiman said.

Levi's Joint Venture?

MOSCOW (Vedomosti) -- Levi Strauss & Co. is looking for partners to produce its blue jeans in Russia.

Russia's largest jeans maker, Gloria Jeans looks likely to become Levi's partner. Last week Levi's representatives visited the Gloria Jeans factory and held initial negotiations on using the factories capacities to produce Levi's, said Levi Europe spokesman Sedrick Jungpeter.

A source at Gloria Jeans said Levi's wanted to produce a new brand called Levi Strauss Signature. The brand would retail at $25 a pair -- compared to other Levi's lines that sell for around $40 -- and be sold exclusively by American retailers such as Wal-Mart.

5 Satellites Launched

MOSCOW (AP) -- Russia launched five small satellites and a replica of moon-orbiting probe into space Friday aboard a Dnepr-1 rocket, Interfax reported.

The booster rocket, a decommissioned ballistic missile converted for commercial space launches, blasted off at 8:10 p.m. Moscow time from the Baikonur Cosmodrome in Kazakhstan, Interfax said, citing the Space Forces.

Space Forces officials could not be reached to comment.

Supercomputer Fine

MOUNTAIN VIEW, California (Reuters) -- Silicon Graphics Inc., or SGI, said Saturday that it would pay $1 million to settle criminal charges arising from its sales of four supercomputers in 1996 to a Russian laboratory that designs nuclear weapons.

In a complaint filed Friday in the U.S. District Court in San Jose, California, the Department of Justice accused SGI of violating U.S. export regulations by failing to get the necessary Commerce Department licenses to send the computers to the high-security Russian laboratory, known as Chelyabinsk-70, in September and December 1996, according to a report in the San Jose Mercury News.

In a statement early Saturday morning, SGI acknowledged two violations of export licensing requirements and said it had agreed to pay a fine of $500,000 for each violation. Mountain View, California-based SGI added that its computers were not used for "military-related applications'" and that it expects the court to approve the settlement in early January.

Russia had initially said it bought the computers to help create a mathematical simulation of a nuclear blast, the San Jose Mercury News reported. Chelyabinsk-70 is a weapons lab, similar to the U.S.-run Lawrence Livermore National Laboratory in California.

The U.S. government uses SGI's supercomputer and graphics systems in various projects, including ballistic missile defense and homeland security.

AvtoVAZ Hits Brakes

MOSCOW (Prime-Tass) -- No. 1 car producer AvtoVAZ plans to halt vehicle production over the New Year holidays from Dec. 28 to Jan.7 and the plant will undergo renovation, an AvtoVAZ official said Friday.

AvtoVAZ expects to produce 720,000 vehicles this year.

AvtoVAZ said the low level of output is due to a halt in work from Oct. 26 to Nov. 9 to due to overproduction.

Earlier, AvtoVAZ general director Vitaly Vilchek said AvtoVAZ would cut its working day by two hours between Nov. 26 and Dec. 28.

The move is aimed at "optimizing production," the plant's press service said.

The company produced about 765,000 cars in 2001, an increase of 8.4 percent from the previous year.

Metro to Invest $600M

MOSCOW (Prime-Tass) -- Germany's Metro Cash & Carry GmbH plans to invest about 600 million euros ($616 million) by the end of 2007 in expanding its wholesale store network in Moscow, general director Herbert Zlabinger said Friday.

He added that within the next five years, Metro Cash & Carry plans to have 10 stores in Moscow. The company currently has three Moscow stores. In 2003, it intends to open stores in Moscow, St. Petersburg and Kiev.

Metro Cash & Carry also plans in 2003 to open the first store of the Real SB supermarket chain, which could be expanded to 20 stores.

Metro Cash & Carry is the third largest trading company in Europe and the fourth largest in the world. It owns 387 stores in 23 countries.

KamAZ Gets UN Work

MOSCOW (Prime-Tass) -- Leading heavy truck manufacturer KamAZ has become an official supplier to the United Nations, KamAZ said in a statement Friday.

KamAZ will therefore be able to directly contact UN departments without Russian government participation or the involvement of other mediating entities, the company said.

The UN will inform KamAZ of all tenders for the purchase of vehicles produced by KamAZ.

KamAZ deputy general director Andrei Surnichenko said the special relationship with the UN was "the result of long negotiations with the help of Russia's Foreign Ministry and Russia's mission to the UN."

For the Record

Cellular operator Mobile TeleSystems on Friday launched its network in the city of Brest in Belarus. (MT)

Russia's national long-distance operator Rostelecom will hike tariffs for budget-funded organizations in Moscow starting January. The tariffs will be increased by an average of 20 percent for calls made from 8 a.m. to 8 p.m. (MT)