The Ongoing Sibir Saga

Coming to this a few days late – the Wall Street Journal published a lengthy account last week of Sibir Energy and its beleaguered top shareholder, former real estate magnate Chalva Tchigirinsky.

There’s not a lot new here to anyone who’s been paying close attention to the case, but it is a decent aggregation of the case’s developments and is yet another reminder of the malleable notion of rule of law in Russia. But the statement from Elena Baturina, whose full involvement in the Sibir case is still not entirely clear, did catch my eye:

“The only issue between us is the loan which I provided to Mr. Tchigirinski and which he has still not paid back. Mr. Tchigirinski told me that the money he received from me was stolen by European banks and he can’t pay back the loan. But afterwards it emerged that he had used the money for his own purposes. I have made several, fruitless attempts to make Mr. Tchigirinski return the money. Because of this, I do not exclude exercising my right to seek redress through the courts.”

The courts in question of course are located in London, but one shudders to think what this case would become were it to be tried in Moscow’s courts. As we have previously pointed out, the case lays bare the extent to which a dysfunctional legal framework winds up costing both the public sector and private sector more time and money over the long haul and seriously stifles the country’s longer-term development.