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Opinion
Matt Levine

Citgo Isn’t Sure Who Its Boss Is

Also POT, IRAs and cold storage.

We have talked about this question a few times in the past, and I have advocated for a sort of legal-realist approach, one that focuses less on philosophical debates about shareholder rights and board accountability and more on practical questions like, who has the keys to the front door and the password to the website? I feel like that approach is soon going to be very useful in understanding Citgo Petroleum Corp. If you look at an org chart, you will notice that Citgo is owned by Petróleos de Venezuela SA, and that PdVSA is in turn owned by the nation of Venezuela, giving the president of Venezuela the ultimate power to appoint (the people who appoint) the people who run Citgo.

But if you look at a map, you will notice that Citgo is mostly in the U.S., while Venezuela is mostly in Venezuela, which has important implications for the exercise of that power, given that the U.S. is trying to oust Venezuelan President Nicolás Maduro and is supporting opposition leader Juan Guaidó’s claim to the presidency. So for instance the president of Venezuela, Maduro, can appoint the president of Citgo and send him to the U.S. to run Citgo, but the U.S. can just not let him come in. That happened: