Struggle to control Moscow's airports appears to be gaining pace

Published: 12/29/1999

According to reports in Kommersant, the future of Vnukovo Airport as an independent entity is looking increasingly difficult as the government with the support of the FSVT transfers Federal property at the airport to the control of a new Federal state unity enterprise (FGUP) which will absorb both the Administration of Domodedovo Airport and the Federal assets left out of the privatisation at Vnukovo Airport and seems likely to be controlled by the East Line Group who control Domodedovo Airport. The assets controlled by the Federal authorities and not owned by the Vnukovo Airport joint stock company include runways, taxiways and aprons, and are used by the airport, but were not subject to privatisation when the airport was originally established as a joint stock company. Its non-inclusion in the privatisation has left it vulnerable to the government and commercial efforts to create a unified Moscow airport operator. The Federal authorities also have the controlling interest at Vnukovo Airport joint stock company through the Federal Property Fund and the Ministry of State Property, although there are no plans at present to sell those interests and they also appear from reports not to have used their votes to silence Vnukovo"s management objections to the moving of the Federal assets. On November 4th 1999,the Presidential Administration issued a letter to the FSVT requesting their views on the future holding structures for Federal assets at Vnukovo .The response on the 5th of November by the FSVT to the Ministry of State Property, was that the assets should be transferred to the Administration of Domodedovo, which should then become a Federal state unitary enterprise called Administration of Moscow Airports. In response to this letter the Ministry issued an order for the transfer. For the FSVT and the Ministry of State Property this appears to be the first step in the creation of a Moscow airports authority controlling all the airport assets in Moscow, including those of Sheremetyevo. According to Kommersant the various authorities consider that the controller of these new assets should be a closed joint stock company Domodedovo International Airport controlled by East Line, giving one company a virtual monopoly of Moscow"s air transport. The efforts to transfer have however, been opposed by the Vnukovo Airport General Director Victor Baikov, who attempted to have the transfer blocked in the Moscow Arbitration Court. An action which was accompanied by a letter from the FSVT asking for the transfer to be suspended, although the letter is reported to have come from Andreyev"s deputy Anatoly Bonderev and was subsequently not acknowledged by the General Director. The key element in these events appears to be East Line, who are reputed to be well connected within the Federal government and are suspected of using this influence to good effect in tying themselves into the concept of a unitary authority for all of Moscow, exploiting the state"s extensive interests at each of the city"s airports. Whether they will succeed is another matter, Mayor Luzhkov has ambitions to control Shermetyevo, still 100% government owned and will be unlikely to give in easily to an East Line Group dominated Moscow administration. For Vnukovo opened in 1941, falling traffic in the Moscow area has led to rumours of proposals for its closure in July 1999. It has also lost a considerable amount of traffic with the transfer of a number of airlines to Domodedovo, claiming overly high charges, including its former sister company Vnukovo Airlines.

Article ID: 1259