Tajik group files lawsuit against Rusal

United Company Rusal, the Russian aluminium group preparing to list on the London Stock Exchange, is facing fresh legal problems following the launch of a lawsuit in the British Virgin Islands by Tajik Aluminium Company. The BVI lawsuit is the latest development in a long-running legal battle, potentially worth hundreds of millions of dollars, being waged over a state-owned aluminium smelting plant in Tajikistan. Tajik Aluminium Company, or Talco, formerly known as Tadaz, alleges that a Tajik businessman, Avaz Nazarov, had a “corrupt relationship” and paid bribes to Abdukadir Ermatov, the plant’s former manager. This, it maintains, allowed Ansol, a Guernsey-based company associated with Mr Nazarov, to supply raw materials to the plant at inflated prices, receiving in return finished aluminium. The barter deal, it maintains, went back to the 1990s, and gave Ansol a $485m profit on its dealings with Tadaz. Tadaz sued in London over the alleged fraud two years ago. But the defendants denied any wrongdoing, and Ansol also claimed to have entered a joint venture deal with Rusal over the Tadaz business in 2003. That, in turn, prompted Ansol to bring a counterclaim against Rusal, alleging there had been an unlawful conspiracy with members of the Tajikistan government aimed at ousting Ansol from the alleged joint venture so that Rusal could take control of Tadaz. This counterclaim is now settled. Talco’s new BVI lawsuit alleges that Rusal was aware of the supposedly corrupt relationship between Mr Ermatov and Mr Nazarov and exploited this to its own advantage – and that Rusal itself defrauded the Tajik plant in the course of supply and purchase arrangements. In documents filed in the BVI, Tadaz also alleges that both Oleg Deripaska, Rusal’s major shareholder and Alexander Bulygin, Rusal’s chief executive, knew of the relationship and the bribes. Rusal on Tuesday dismissed the accusations as “baseless”. The new lawsuit comes as Mr Deripaska faces a separate legal threat from Michael Cherney, a founding father of Russia’s post-Soviet aluminium industry, over a disputed 20 per cent stake in Rusal, potentially worth more than $6bn. The claim – dismissed as completely without foundation by Mr Deripaska – is temporarily halted, however, while a dispute over whether it was properly served is sorted out. Rusal, the world’s largest producer of aluminium, is thought to be worth at least $30bn. The group is expected to sell a stake of at least 25 per cent with its London listing, which is scheduled before the end of this year.