Parliament bans Nikopol privatization again

The Verkhovna Rada has once again banned the privatization of a 50-plus-one percent interest in the Nikopol Ferroalloy Works of Dnipropetrovsk, which will be owned by the state in 2006-07.

Two hundred and seventy-one parliamentarians voted for the new wording of Bill no. 9041 “On the Introduction of Changes to the Law ‘On a List of State Properties not Subject to Privatization’” - although passing the bill required 226 votes.

Forty-two MPs voted for President Yushchenko’s move to reject the bill, while 241 MPs voted to override the president’s veto.

The bill was tabled by the socialist MP Mykola Sadovy. He argued the need to pass this bill by pointing to the NFW’s strategic importance to Ukraine’s economy and national security as well as the unique nature of this mining and metallurgical complex.

In banning the privatization on Feb. 9, the Verkhovna Rada reaffirmed that these assets should remain state property. The Ukrainian president vetoed the law later. The Ukrainian cabinet won the case of the illegitimate privatization of NFW in the courts, and proceedings are now underway to return the 50-plus-one interest (owned by the Prydniprovia Concern) to state ownership.

At the moment these shares are with Ukrsotsbank, which is acting as custodian. Interpipe, which controls Prydniprovia, has about 73 percent of the shares in the Nikopol Ferroalloy Works, while the Privatbank group controls some 26 percent.