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. Last Updated: 07/27/2016

Business in Brief

Kasyanov on Taxes

MOSCOW (Prime-Tass) -- Prime Minister Mikhail Kasyanov said Thursday that the current tax collection level is between 95 percent and 96 percent, up from 60 percent four years ago.

The level of tax collection is now higher than in some countries of the European Union, Kasyanov said at a government meeting.

"The government's mission to carry out tax reform has almost been completed," he said.

FSC Cracks Down

MOSCOW (MT) -- The Federal Securities Commission announced Thursday that a new law aimed at cracking down on insider trading and making the market more transparent will come into force on Oct. 13.

The new law on insider trading is Russia's first regulation dealing with such offenses. Its enforcement comes amid pledges by FSC chairman Igor Kostikov to clean up the market and follows the launch earlier this year of eleven FSC probes into leading Moscow investment banks suspected of unfair dealing.

"This law puts all the market players in equal conditions when it comes to receiving information. This will considerably limit opportunities to use insider information in conducting deals," Kostikov was quoted by Interfax as saying Thursday.

The law requires companies to disclose information on equity and debt issues by 10 a.m. the day after the event through two officially approved news agencies -- Interfax and AK&M. The information can also be distributed through free-access internet sites within three days and through printed media within five days.

The new law, approved by the FSC in July, tightens the deadline for the release of quarterly financial result reports to 45 days after the end of the quarter. Major changes in the issuers' shareholding structure or profits are required to be disclosed in quarterly reports.

Toyota Mulls Plant

MOSCOW (MT) -- The chairman of Japanese car giant Toyota, Hiroshi Okuda, is set to visit Russia later this month as the company considers going into local production, a company representative said Thursday.

News of the Toyota head's visit comes as sales of locally-produced foreign cars, such as those made by Ford and General Motors, soar. The official is coming "to see how the company is doing on the market," a representative of Toyota's Russia sales department said by telephone from Tokyo, on condition of anonymity.

Japanese news agencies Thursday cited sources close to negotiations as saying Okuda's visit was aimed at clinching a deal to build a car plant that would produce tens of thousands of Corolla sedans and Land Cruiser jeeps.

A spokesperson for Toyota in Russia would not confirm or deny those reports, saying she was not aware even of Okuda's plans to visit. She did say, however, that Toyota was continuously looking into the possibility of building a plant in the country. "There is nothing concrete yet," she said.

Toyota had planned to build a factory in Russia before the 1998 financial crisis, but then pulled out of the project because of the market's collapse.

Last year, however, as the local economy recovered, Toyota and its luxury division Lexus more than doubled their sales to 8,630 in Russia.

Sberbank Bond Debut

MOSCOW (Reuters) -- Top bank Sberbank said Thursday it might offer its debut floating rate bond to international debt markets in the last quarter of 2003.

Sberbank has appointed UBS Investment bank as lead manager for the issue, the state-run bank said in a statement.

"Providing market conditions are favorable, we plan for a substantial issue to be placed in the fourth quarter of the year," the statement said. It gave no further details.

$400M MTS Eurobond

MOSCOW (Reuters) -- The country's No. 1 mobile operator, Mobile TeleSystems, said Thursday that it planned to issue a eurobond worth up to $400 million, with marketing of the paper beginning within the next week.

"The final terms of the transaction will depend upon market conditions, although MTS does not expect the offering to exceed $400 million," it said in a statement. CSFB and ING are to lead manage the issue.

The proceeds of the planned senior unsecured dollar-denominated Eurobonds would be used to refinance the company's outstanding debt, the statement said.

The notes will be issued through MTS's subsidiary Mobile TeleSystems Finance S.A., a company operating under the laws of Luxembourg, it said.

In August, MTS placed $300 million in floating rate notes to finance the buyout of minority shareholders in subsidiaries and finance the company's expansion. MTS also has an outstanding $400 million 2008 eurobond and a $300 million 2004 eurobond.

OPEC Pressures Rivals

OSLO, Norway (Reuters) -- The OPEC oil cartel on Thursday raised pressure on rival producers to join output restraint efforts even though prices seem too high for non-OPEC states to consider sharing the load.

OPEC's No. 3 producer Venezuela will host Norway's oil minister for market discussions later this month, a Norwegian ministry spokeswoman said Thursday.

OPEC last week agreed to cut production by 3.5 percent from Nov. 1 to curb growth in consumer inventory stockpiles as rival production rises from Russia and West Africa and Iraq's post-war production slowly recovers.

The group, which controls around half the world's oil trade, said it expected non-OPEC producers to join in if further cuts are needed.

OPEC meets again on Dec. 4 to decide policy for the first quarter 2004.

In 2002, top non-OPEC producers Russia, Norway and Mexico supported OPEC cuts by making their own curbs, but only after prices had fallen to $17 a barrel. OPEC's basket of crude oil was last valued at $27.08 a barrel, near the top of the cartel's $22-$28 target range.

President Vladimir Putin said last week that Russia could join curb exports if crude prices come under pressure, but analysts doubt Moscow's willingness to cut actual supply, saying Russian fuel exports fall during the domestic winter anyway.

MMK Touts Bond

YEKATERINBURG, Ural Mountains (Reuters) -- Magnitogorsk Iron and Steel Works, or MMK, one of the country's largest metals firms, has started a roadshow for an international bond issue, a source in the company familiar with the deal said Thursday.

"MMK will not comment on rates, maturity or the size of the planned issue because of existing legislation," the source said.

The source said the presentation of the bond started Wednesday and is expected to be completed in London on Oct. 8.

The proceeds from the notes are intended be used to refinance a portion of MMK's existing debt and to fund the modernization of its facilities.

Gazprom Output Up

MOSCOW (Reuters) -- Gazprom, the world's top gas producer, boosted output by 3.8 percent in the first nine months of 2003 to 395.65 billion cubic meters from 380.98 bcm in 2002, the Energy Ministry said Thursday.

Russia's total gas output also rose by 4.3 percent to 453.15 bcm in January-September 2003 from 434.65 bcm in the first nine months of 2002, mainly due to Gazprom.

The company is heavily investing in Siberian fields to reverse a period of output slump.

Sukhoi Holding Co.

MOSCOW (MT) -- The government has finally completed the creation of the Sukhoi Aviation Holding Co. in a major step toward consolidating the country's mammoth defense sector.

The Property Ministry registered AHC Sukhoi as a 100 percent state-owned entity on Wednesday, Sukhoi said in a statement.

The new structure, whose best-selling fighter jets account for the majority of Russian arms exports, raking in more than $1 billion a year, will unite the state's 74.5 percent stakes in two production facilities in Novosibirsk and Komsomolsk-on-Amur, known by their acronyms NAPO and KnAAPO.

For the Record

Gazprombank's net profit amounted to $154 million in January-June, as calculated under international accounting standards, the bank's vice president, Ilya Kochevrin, told reporters Thursday, without providing comparative figures. (Prime-Tass)

Crude oil and gas condensate output rose in January-September by 11 percent to 311 million metric tons (8.35 million barrels per day) from 280 million tons (7.5 million bpd) in the same period last year. (Reuters)