Potash Chief to Remain in Belarus Prison as Court Rejects Plea

Belarus will keep Vladislav Baumgertner, the chief executive officer of Russian potash producer OAO Uralkali (URKA), in detention in Minsk after a judge rejected a plea from lawyers for his release.

Under Judge Natalia Pykina’s ruling, Baumgertner must remain in Belarus while an investigation into alleged abuse of office is underway. His legal team will challenge the decision to leave Baumgertner’s status unchanged, Dmitry Goryachko, the Russian executive’s lawyer, said at the courthouse.

Baumgertner’s detention on Aug. 26 stems from the July decision to end a marketing joint venture with Belarus’s Belaruskali, plunging the former Soviet Union’s two largest potash producers into a dispute and roiling the $20 billion global market for the crop nutrient. He was taken into custody at the Minsk airport after being invited to talks by Belarus Prime Minister Mikhail Myasnikovich.

Uralkali quit the Belarusian Potash Co. joint venture because Belarus “violated” their agreement by allowing Belaruskali to export some of its potash independently, the Russian company said at the time. Uralkali said it would work at full capacity, a strategy that would lead to a decline in potash prices.

Uralkali shares fell in London.

Belarus charged Baumgertner, who is also chairman of BPC, with abuse of office. He faces as long as 10 years in prison and may forfeit property if convicted.

European Ban

The case was heard by Pykina in the Partizanskiy district court in Minsk. Along with President Alexander Lukashenko, she is among Belarusian officials barred from entering the European Union after her 2011 sentencing of an opposition activist to 3 1/2 years’ imprisonment in a high security prison.

Baumgertner’s Moscow-based lawyer, Alexey Basistov, said in a Sept. 4 interview his legal team would argue that were no grounds for the CEO’s detention and that he should be freed, or at least the terms of his confinement should be eased.

Guarantees in support of Baumgertner’s release were provided by Viktor Basargin, the governor of Russia’s Perm region, and Igor Barinov, a deputy from the ruling United Russia party in the lower house of parliament, Basistov said. Uralkali’s potash mines and production plants are in Perm.

Belarus is seeking to arrest Uralkali billionaire investor Suleiman Kerimov and four other employees of the fertilizer producer through Interpol.

Russia, which led a $3 billion bailout loan to Belarus in 2011, has called for Baumgertner’s release. The government expects Belarus to comply within the “coming days,” Yuri Ushakov, a Kremlin foreign policy aide, told reporters on Aug. 30 in Moscow. Belarus is scheduled to receive the final $440 million of the Russian-led emergency funding by the end of the year.

Uralkali has repeatedly rejected all of Belarus’s allegations against Baumgertner and its other employees. The company will seek help from “appropriate Russian authorities” to help stop “politically motivated persecution” of its staff, it said this week.

To contact the reporters on this story: Aliaksandr Kudrytski in Minsk, Belarus at akudrytski@bloomberg.net; Yuliya Fedorinova in Moscow at yfedorinova@bloomberg.net; Ilya Khrennikov in Moscow at ikhrennikov@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net

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