Russian Federation aluminium major Rusal finds itself the subject of sanctions placed upon it by Ukraine. The world’s second-largest aluminium producer was accused of undermining the country’s national security in a decree handed down by the country’s president Petro Poroshenko.
Rusal joins over three hundred other Russian citizens and businesses that are subject to restrictions placed upon it by the current Ukrainian leadership. The presidential decree gives Ukrainian authorities the right to freeze Rusal’s assets and block its economic actions within the country. It also prohibits the firm from removing capital, bidding on government contracts, and engaging in share transactions.
The decree did not specify how the president believes Rusal’s actions threaten the country. However, Rusal indicated in a statement that it believes the sanctions are a retaliation for regaining control of Zaporozhye Aluminium Smelter (ZALK) in recent arbitration proceedings at the International Centre for Settlement of Investment Disputes Against Ukraine. ZALK is Ukraine’s sole aluminium plant. Rusal also owns Mykolayiv, which is Ukraine’s largest alumina plant.
Rusal’s statement went on to say that it has yet to settle upon a response to the sanctions, but that it would protect its interest in any event.
“The Company is analyzing the potential impact the newly introduced Ukrainian sanctions may have on the operations of the two subsidiaries and the Group as well as the actions to be undertaken by the Company to protect the interests of the Company and its shareholders. The Company will update its shareholders and investors as and when required under the applicable laws and regulations.”