Ukraine's Parliament Mulls Ukrtelecom Commission Creation

KIEV, Ukraine -- Ukrainian lawmakers may create a special commission to investigate privatization of national phone company UkrTelecom amid skepticism about the government’s story suggesting the company had been purchased by five Austrians.

Oleksandr Riabchenko, the head of the State Property Fund, told lawmakers on Friday UkrTelecom had been purchased by the five Austrian managers of a private investment house.

The assurances, however, did not quell the skepticism among some lawmakers that believe the phone company may have been actually acquired to benefit interests of President Viktor Yanukovych’s circle.

“Here is what I suggest: if we need to, let’s create the commission that would investigate this issue,” Volodymyr Lytvyn, the speaker of Parliament, told Channel 5 television Sunday. “When there are doubts, we should go parliamentary way to establish the truth instead of speaking with mysterious phrases.”

The developments cast more controversy on the privatization of UkrTelecom, the first major selling of state assets since Yanukovych had been sworn in as the president in February 2010.

Foreign investors have been watching the UkrTelecom privatization for clues of whether Yanukovych’s government would live up to its promises of holding transparent selling of state assets.

Epic Systems Ukraine LLC, or ESU, recently signed the agreement to acquire 92.7% in UkrTelecom for 10.57 billion hryvnias, or $1.3 billion.

The money is supposed to change hands within two months.

But the controversy rose last week after a report in a newspaper suggested that ownership of ESU has changed two months before the company had submitted its bid for the Ukrainian assets.

“The buyer is owned by a Cyprus-based company, while the Cyprus-based company is owned by an Austrian company, while the Austrian company is owned by the five citizens of Austria,” Riabchenko tried to explain to lawmakers on Friday. “So, through the Cyprus-based company, which is not unknown, the buyer is owned by the citizens of Austria.”

The five Austrians include Peter Goldscheider, Brigitte Goldscheider, Gustav Wurmbock, Marina Wurmbock and Franz Lanschutzer, according to SPF papers.

Source: Ukrainian Journal