Court wrangle over commission payments (267 words)

Published: 8/6/2001

OOO Yuridicheskaya Aviationnaya Sluzhba (Legal Aviation Service/LAS) has filed a claim with the arbitrage court to stop the merger of Siberia Airlines (Sibir) and Vnukovo Airlines, on the basis that it is owed Rb 4m ($137,000) by Sibir for commissions earned from selling VAL tickets. Sibir, for its part, accepts that it owes LAS commission as a result of the merger of the two airline's activities, which is already in force in practice, but it disputes the level of the payments. The airline has, therefore, counterclaimed for a decrease in the alleged sum and has further requested that the court prevents claims for this type of debt against Sibir being used to halt the merger process. According to Igor Volkov, from Sibir, the case will be discussed this month but, given the size of the debt, he does not envisage it as being a serious threat to the merger. However, the risks of this type of case are high in terms of irritation, as those claiming against a company can cause considerable trouble in the rather chaotic Russian commercial legal system, which is only now in the process of being overhauled and which is often subject to contradictory decisions by courts at various levels. It still seems unlikely that Sibir would jeopardize the merger over the difference between $137,000 and what it thinks is the correct figure. LAS has operated in the transportation sector since 1998, providing agency sales, audits and consulting (East Line, Domodedovo Airlines, Orenburg Airlines), as well as commercial management (KrasAir).

Article ID: 2690