The British Council Reached Disagreement with Russia
// The tax dispute is no longer public
The organization challenges tax officers in Moscow and St.-Petersburg
Yesterday Moscow’s tribunal tried a case of the British Council Russia filing a suit against Russia’s Federal Tax Service (FTS). The British Council intends to challenge some of the tax fraud accusations of 2004-2006. A similar process has been launched in St.-Petersburg. Interestingly, the sides used to take advantage of such occasions to make harsh political statements, whereas now they prefer to abstain from political rhetoric refusing even to divulge the sums of the claims and their essence. Experts concluded that the change of tactics is evident of Moscow and London’s eagerness to normalize their relations. They’ll make the first step in this direction at the G8 summit in Japan this June.
Moscow’s arbitrage held a preliminary sitting regarding the suit of the British Council Russia against Moscow’s FTS interdistrict inspectorate #47. The Council aims to put into question the tax fraud accusations of 2004-2006, which were brought against the organization after auditing. Representatives of the British Council in Russia told Kommersant that the tax claims were received in May, 2008 and the organization has already paid everything off. “But we’ll appeal some certain clauses of the claims we disagree with,” the Council’s press-service reported. Yesterday the sitting in the Moscow court of arbitration was put off till July 3 at the desire of the tax inspectorate. After the sitting neither of the sides explained what claims were disputed. FTS officers said that they “are not allowed to give any commentary,” and the British Council’s lawyers didn’t even bother to say anything to Kommersant. “We can’t discuss the details of the tax claims since the case is underway now,” explained the Council’s press-service. In the central office of the organization they added that they consider the present conflict “routine practice of tax disputes.”
The British Council was set up by the government of Great Britain as a humanitarian NGO. The government has offices in 110 countries of the world and informs people about the British culture and art, organizes educational programs, holds exhibitions and cinema festivals. In Russia the British Council, with its headquarters in Moscow, has worked since early 1990s. It has its offices in St.-Petersburg and Yekaterinburg as well.
It need be reminded that last December the Russian Foreign Ministry forbade the regional divisions of the Council in St.-Petersburg and Yekaterinburg to work in Russia referring to its “illegal status.” The Russian authorities made no secret of the fact that their action was politically motivated.
Russia’s Foreign Minister Sergey Lavrov stated that the closing of the offices of the British Council was brought about by Britain’s extradition of Russian diplomats in response to Russia’s refusal to extradite businessman Andrey Lugovoy, who was suspected of committing the murder of political emigrant Alexander Litvinenko.
A similar trial has been launched at the court of arbitration of St.-Petersburg and the Leningrad region. “Preliminary sittings have been held, and the next one has been planned for July 3,” the plaintiff’s lawyer Sergey Sosnovsky told Kommersant, “But it’s only the Council’s representatives who are authorized to comment on the matter.” The FTS department in St.-Petersburg and the court of arbitration demanded official letters of inquiry, but no answer has been received so far. Second Secretary of the representatives of the Russian MFA in the Sverdlovsk region Sergey Ivanov told Kommersant, “In Yekaterinburg the case of the British Council hasn’t been closed yet, all consultations regarding the matter are held in Moscow now.” According to the information of Kommersant sources in the diplomatic circles, the negotiations “have proceeded slowly but surely,” and it’s not ruled out that the British party will consent to Russia’s terms concerning the organization of the Council’s work. “We reckon that the issue may be settled by the end of the year, and the British Council will manage to resume its activity under the auspices of the Russian law,” the diplomat told Kommersant.
“What’s now happening over the British Council, is connected with the forthcoming meeting of Russia’s President Dmitry Medvedev and Britain’s Prime Minister Gordon Brown at the G8 summit in Japan,” Andrey Fedorov, Director of Foreign Policy Programs with the Council for Foreign and Defense Policy, Deputy Foreign Affairs Minister in 1990-1991, opines. “According to the information we have, it has been finally agreed to hold this meeting. The British party also reported that Mr Brown will hand over an invitation to visit London to Dmitry Medvedev to discuss a cluster of proposals envisaging the normalization of the bilateral relations. If both agreements are reached, the problem of the British council’s work in Russia will be resolved.” However, officials with the Department of Information and Press of the Russian MFA refused to confirm this version and said that the conflict’s assuming non-public forms “doesn’t mean that the Russian government’s line on the British Council has changed.”
Andrey Kozenko, Maxim Kirillov, St.-Petersburg; Ella Bidilieva, Yekaterinburg
All the Article in Russian as of June 20, 2008
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