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Press review: Moscow to take property spat to UN and what awaits Russia after US midterms

Top stories in the Russian press on Tuesday, November 6


Kommersant: Russia to address UN over diplomatic property seized in US

Moscow will raise the issue of Russia’s diplomatic property seized in the US at the UN General Assembly in the near future, a source in the Russian Foreign Ministry informed Kommersant. Russia earlier sent 120 formal enquiries and notes of protests to the US describing Washington’s actions as "a gross violation of international legal obligations."

According to Russian diplomats, Moscow is also pushing ahead with its efforts to file lawsuits with US courts. Currently, it is known that the White & Case LLP international law firm will be representing Russia’s interests. "We cannot refrain from acting when we are actually being robbed in broad daylight," one of Kommersant’s government sources said, adding though that the chances of winning the legal battle look pretty slim.

Another source said he doubted that US courts would take up the case at all and stressed Russia could turn to international organizations to resolve the crisis.

On the other hand, Moscow will keep trying to sway the US through diplomatic channels, demanding at least permission to inspect the seized property. "Today, six Russian diplomatic premises in the US, which are Russia’s state property and enjoy diplomatic immunity (except the leased offices of the trade mission in New York and the Consulate General in Seattle), have been fully seized. Despite the wording of the State Department’s notes saying that access there is closed for ‘all individuals,’ the Americans’ presence there is seen regularly. Russia as the property owner never gave any permission for that, and no one has ever asked for it," a source in the Russian Foreign Ministry told the paper.


Vedomosti: Midterm elections may weaken Trump's sway in US Congress

The midterm elections to the US Congress, which will determine the political landscape for the second half of Donald Trump’s presidential term, will be held in the United States on Tuesday. Now Trump’s supporters control the majority of seats in both houses. However, according to some estimates, after the elections they are expected to only retain control over the Senate, while losing the majority in the House of Representatives, Vedomosti writes.

If the Democrats are able to get the majority in Congress, that will rein in Trump’s power substantially, but his impeachment is highly unlikely even in the event of that scenario. If the Republicans retain the majority of seats, it will be easier for Trump to press ahead and undo Obama’s healthcare reform plan.

On the other hand, if the Democrats get a majority of seats in the House of Representatives, it will be easier for them to lobby for a tougher policy against Russia, North Korea and Saudi Arabia.

The situation where Republicans dominate both houses is uncharacteristic of the United States, so the country is likely to return to the traditional deterrence and counterbalance system, when the Republicans control one house and the Democrats the other, the paper quotes William Smirnov, Head of the Department of Political Science at the Russian Academy of Sciences’ Institute of State and Law, as saying. "It is hard for Trump to win the support of minorities. That gives the Democrats an advantage, particularly in those states with a large proportion of the Spanish-speaking population," he stressed.

According to the expert, Trump made the right decision to return to the Iranian agenda shortly before the elections, as American society in general supports the president in matters related to countering radical Islam. Meanwhile, the Russian agenda is of no considerable importance at these elections, he explained. "Relations between Russia and the US at the moment depend on Washington’s relations with China rather than on the domestic political landscape in the US, because Beijing continues to be a more important partner for the Americans and, at the same time, Russia’s ally."


Izvestia: Second round of US sanctions against Tehran won’t isolate Iran

Washington’s restrictive measures will not be able to cut off Iran from the rest of the world, Russian Senator Alexei Pushkov told Izvestia.

The second round of US sanctions against Tehran came into effect on Monday, November 5. Washington thus fully re-imposed those restrictions, which it had lifted after the Iran nuclear deal had been signed. Washington also threatened to impose secondary sanctions on those countries and corporations working with Iran.

Nevertheless, the US made an exception for eight countries and territories, including India, Italy, Turkey, Japan and China, which, Washington says, can continue to import Iran’s energy resources.

"The US cannot impose secondary sanctions on India, South Korea and Japan, since this will worsen its relations with these countries dramatically. As for relations with India, the Americans have done a lot to draw them (India) closer, and it is not in their interests to damage relations with New Delhi. Japan depends on Iran’s oil to a great extent, and severing ties with that country would be tantamount to a crisis in its economy. Iran is highly sought after in many markets, so the US had to show flexibility," Pushkov explained.

According to the lawmaker, the sanctions will cut back the volume of Iran’s trade, but the US will not be able to impose a total boycott. Tehran will continue selling oil abroad, even by using special tools, which make it possible to bypass the sanctions.


RBC: Russian companies anxious over new US sanctions

As many as 86% of large Russian companies fear new US restrictions, according to a recent survey conducted by the Adizes Institute business consulting company for RBC. Experts interviewed 1,015 owners and CEOs of big businesses, with 38% of those surveyed in manufacturing, 17% in construction, 16% - in transport, 14% - in financial sphere.

The US Congress can discuss new restrictive measures after the November 6 midterm elections. In April, Washington expanded anti-Russian sanctions, and in August the sanctions pressure had started intensifying again.

Ninety-five percent of those polled said they had felt the effects of the April round of sanctions, saying that the ensuing ruble depreciation and financial market volatility primarily affected their businesses, while the remaining 5% said their rivals had been sanctioned. Ninety-seven percent said they were closely following reports about new potential sanctions, and nearly all those polled said they expected sanctions to be toughened within the next six months.

The weakening ruble and volatility of financial markets are seen as the least critical factor, stressed Valery Mironov, Deputy Director of the Center of Development Institute at the Higher School of Economics. "There will be no disaster if the ruble continues to be weak. The Bank of Russia has sufficient gold and foreign exchange reserves. If fluctuations go beyond the average boundaries of recent years, the Central Bank can intervene," the paper quotes him as saying.

According to the survey, 31% companies said a ban on government-owned banks’ foreign exchange operations could be the worst impact of the sanctions. "State banks constitute a significant part of, but not the entire banking system. In that case, alternative methods to closing deals will have to be found," Mironov said when commenting on the issue.


Izvestia: Aluminum giant Rusal ‘moves’ back to Russia

The Board of Directors of Russia’s US-sanctioned-hit aluminum giant, Rusal, has decided to change the company’s jurisdiction by moving from the island of Jersey, one of the world’s biggest offshore territories, to Russia, Izvestia writes. That meets the interests of the company and its shareholders, Rusal said in a statement on the website of the Hong Kong Stock Exchange.

In September, Russian Economic Development Minister Maxim Oreshkin said the company was expected to be re-registered in Russia in October.

According to Rusal, to complete the process, it is necessary to get the greenlight from Russian authorities and bring the regulatory documents into compliance with Russia’s legislation.

Rusal’s desire to change its registration is quite natural, Yaroslav Kabakov, Head of the Strategy Development Department at Finam, told the paper.

"As for the interests of Rusal and its beneficiaries, they are unlikely to be affected substantially. One of the key advantages of registration in Western jurisdictions is the ability to attract foreign investment," he explained. "However, given the current political environment, Western investment is ruled out. Besides, in Russia, Rusal will apparently be registered in one of the country’s domestic offshore territories, which means it will not pay any taxes in the amount envisaged for the majority of national companies."

Where exactly Rusal will be registered is not really important, the expert added. Anyway, that will be a region, which has been selected by the government as a priority development area.


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