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Crimean authorities take control of Krymkhleb nationalized enterprise - Aksyonov

November 13, 2014, 0:49 UTC+3 SIMFEROPOL
“Employees established control of the enterprise on their own. We just helped them a little,” Aksyonov said
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© ITAR-TASS

SIMFEROPOL, November 12. /TASS/. Crimea’s authorities have taken control of bread company Krymkhleb, which was nationalized Wednesday, Crimean head Sergey Aksyonov said.

“Employees established control of the enterprise on their own. We just helped them a little,” Aksyonov said. “There are a few representatives of militia there now, but there is no need to guard the enterprise in a special way now.”

He warned former heads of Krymkhleb that should they appear on the Crimean Peninsula, they could be brought to criminal account in line with laws of the Russian Federation.

Earlier today, Crimea’s parliament, the State Council, decided to nationalize the company as well as the Simferopol bread products combine - a flour maker. The enterprise’s employees asked the republic’s authorities to do so.

Earlier it was reported that Crimea’s financial supervision service revealed "financial losses as a result of inefficient managerial solutions" worth 285.2 million rubles ($6.1 million) in Krymkhleb.

Crimea’s prosecutors are checking the financial and economic activities of Krymkhleb, whose owners are suspected of involvement in the financing of Kiev’s military operation against Ukraine’s southeastern regions.

What Krymkhleb is suspected of

Dmitry Prostakov, the head of the Crimean Anti-Corruption Committee’s department for anti-corruption inspections, said November 6 that Krymkhleb could be involved in financing an “antiterrorism operation” the Kiev authorities are conducting in southeast Ukraine.

Prostakov showed journalists documents indirectly confirming that the company’s funds were withdrawn to Ukraine. He said the committee has information that 75 million rubles ($1.6 million) designed to buy flour was sent to a conversion center, converted into cash, exchanged to dollars and withdrawn to Kiev.

A spokesman for the tax inspectorate department in Simferopol, Oleg Petrov, said the tax service checked Krymkhleb’s activity and revealed numerous violations, including expenditures without documentary confirmation, as well as non-withholding of the individual income tax from employees.

Crimean head Sergey Aksyonov said October 30 that the republic’s authorities are considering nationalization of Krymkhleb enterprises.

The Krymkhleb public company is the largest producer of bakery and confectionery goods on the Crimean peninsula. The enterprise has structural units in Bakhchisarai, Dzhankoi, Yevpatoriya, Kerch, Simferopol, Feodosiya and Yalta.

According to Krymkhleb business director Denis Boiko, the company produces some 127 metric tons of bakery goods daily, with the monthly earnings exceeding 100 million rubles ($2.2 million). The share of the company’s products on the Crimean bread market totals 36%

Krymkhleb’s owner is Lauffer Group registered in the Netherlands.

Crisis in Ukraine

The Republic of Crimea and Sevastopol, a city with a special status on the Crimean Peninsula, where most residents are Russians, refused to recognize the legitimacy of authorities brought to power amid riots during a coup in Ukraine in February 2014.

Crimea and Sevastopol adopted declarations of independence on March 11. They held a referendum on March 16, in which 96.77% of Crimeans and 95.6% of Sevastopol voters chose to secede from Ukraine and join the Russian Federation. Russian President Vladimir Putin signed the reunification deals March 18.

After that, mass protests erupted in Ukraine’s southeast, where local residents, apparently inspired by Crimea's example, did not recognize the coup-imposed authorities either, formed militias and started fighting for their rights.

According to the UN, more than 4,000 people have been killed and hundreds of thousands have fled Ukraine’s southeast as a result of clashes between Ukrainian troops and local militias in the Donetsk and Lugansk regions during Kiev’s military operation, conducted since mid-April, to regain control over the breakaway territories, which call themselves the Donetsk and Lugansk People’s republics.

Kiev has called its military operation against the regions "an antiterrorism operation".

The parties to the Ukrainian conflict agreed on a ceasefire at talks mediated by the Organization for Security and Cooperation in Europe (OSCE) on September 5 in Belarusian capital Minsk. The ceasefire took effect the same day but has reportedly occasionally been violated.

In the Soviet Union, Crimea used to be part of Russia until 1954, when Nikita Khrushchev, the first secretary of the USSR’s Communist Party, transferred it to Ukraine's jurisdiction as a gift.

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