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2020.03.01 11:59

LRT FACTS. Russian plane under US sanctions arrived in Vilnius. Why?

Jurga Bakaitė, LRT.lt 2020.03.01 11:59

A plane belonging to Russia‘s Yevgeny Prigozhin, who is currently under US sanctions, was spotted in Vilnius on January 28. Why was the plane in Lithuania in the first place? And could this lead to US sanctions on Lithuanian companies?

Yevgeny Prigozhin is connected with the private military company Wagner that has taken part in conflicts in Syria, several African countries, and Ukraine. Prigozhin, as well as his planes and yacht, came under US sanctions for his infamous ‘troll farm‘ in St Petersburg, interference in the US elections, and for the role he played in Russia's war in Ukraine. LRT FACTS investigates why the plane landed in Vilnius and what the repercussions could be.

“By accepting this plane, Lithuania as a country became an accomplice of Prigozhin, even if indirectly,“ Marius Laurinavičius from the Vilnius Political Analysis Institute posted on Facebook.

Read more: Lithuanian parliament seeks EU sanctions on 'Putin's chef'

Quick to respond, Gediminas Žiemelis from Avia Solutions Group – the Lithuanian company allegedly behind the work offered on Prigozhin's plane – denied the allegations.

“If there‘s a ban placed on the plane – it would be prevented from landing” in Lithuania by the authorities, he wrote on social media. “We have US investors and we‘re fully supervised – that‘s why the previous [media allegations] and Laurinavičius‘ ‘tale‘ are under legal scrutiny by US investors.“

Vygaudas Ušackas, a former Lithuanian foreign minister and EU ambassador to Russia, is now a member of the board at Avia Solutions Group. He declined to comment. Meanwhile, the company‘s spokeswoman Vilma Vaitiekūnaitė dismissed the claims as “speculations”.

Read more: Putin's regime, kleptocracy, and drug money – interview with investigative journalist Anastasia Kirilenko

“Our company is not working, has not worked, and has refused to work [on the plane],“ she told LRT FACTS. “We have no intention to do so, because we have procedures whereby every client and supplier is vetted.“

“We are issuing bonds“ and are operating under “very strict international jurisdiction, where we cannot work with sanctioned clients,“ she said, adding that the company wouldn‘t put the whole business at risk over a single customer.

She also denied that Avia Solutions Group is the only company able to service the aircraft at the Vilnius airport.

Meanwhile, aviation experts interviewed by LRT FACTS who preferred to stay anonymous claimed that two companies owned Avia Solutions Group, FL Technics and Jet Maintenance Solutions, are the likely contractors, because they have the necessary certificates to work with Hawker 800B-type aircraft owned by Prigozhin.

And following the publication of this article on LRT.lt in February, the company admitted that it had worked on another plane back in 2018 owned by Prigozhin.

The parliamentary commitee on security and defence also said the company admitted it was due to service Prigozhin's plane.

Meanwhile, a Lithuanian MP from the parliamentary committee on security and defence, Laurynas Kasčiūnas, turned to the country‘s prime minister calling for action. He asked PM Saulius Skvernelis to propose options to prevent Prigozhin-owned aircraft from landing in Lithuania again.

Kasčiūnas also called to initiate the process of adding Prigozhin onto the EU sanctions list, and also impounding the plane that arrived in VIlnius.

Who’s servicing the plane?

Vidmantas Plėta from Lithuania’s state-owned Transport Competency Agency that supervises aviation services said no other company in Vilnius is able to work on Hawker 800B-type aircraft.

Charter Jets denied that it can work with the aircraft, contrary to Avia Solutions Group claims. Other companies working at the Vilnius airport also said they wouldn’t be able to service Prigozhin’s plane.

At least several aviation experts interviewed by LRT FACTS said a possibility exists that the plane was simply parked at the airport, due to the cheaper fees than in other regional airports. Another likely possibility is that the plane is now in the process of being registered under a different ownership.

Meanwhile, Giedrius Mišutis from the Lithuanian State Border Guard Service confirmed to LRT FACTS that the plane arrived in Lithuania for maintenance. However, it left several weeks without being serviced.

Can US sanctions target Lithuania?

Even if the plane wasn’t serviced, its owners must pay the parking fees to the state-owned Lietuvos Oro Uostai (Lithuanian Airports).

Yet, the airport is not the authority making decisions whether to permit a plane to land if it's targeted by sanctions, said Tadas Vasiliauskas from the Lithuanian Airports.

“We’re infrastructural objects that fulfil certain requirements,” he said, adding that the airport follows the regulations set by state institutions.

Prigozhin’s plane belongs to a company registered in the Cayman Islands, a tax-haven. The US Department of Treasury said the company is directly connected to Prigozhin.

“By continuing to service these aircraft [the] providers of such services run the risk of facilitating or supporting Prigozhin’s nefarious activities and may also be subject to future sanctions,” according to the US Treasury.

The US states that Prigozhin, as well as his VP-CSP plane, is subject to sanctions over Russia’s conflict in Ukraine, cyber threats against the US, and interference in the US election.

Read more: Russian troll farm offspring picks Lithuanian soldiers for propaganda

The US Embassy in VIlnius declined to comment whether Lithuanian companies could come under American sanctions by working with Prigozhin’s assets.

American sanctions probit US citizens from getting into any contractual obligations with the sanctioned individuals and entities, according to Rimantas Daujotas, an associate at the Motieka ir Audzevičius law firm in Vilnius.

“All assets on the list are detained because of the sanctions, including the identified aircraft and ships,” he said.

Meanwhile, the Lithuanian Foreign Ministry told LRT FACTS that businesses working with companies tied to Prigozhin risk secondary sanctions.

According to the US Treasury, secondary sanctions can be applied if there is “a significant transaction” with the sanctioned entities. The US can then apply secondary sanctions to prevent them from dealing with American businesses and citizens.

The Lithuanian Foreign Ministry said no Lithuanian company had come under US sanctions.

“Secondary sanctions may be applied in isolated cases, if the US institutions ascertain the need to apply them,” the ministry told LRT in a written statement.

“A dangerous game”

Tadas Vizgirda from the American Chamber of Commerce in Lithuania said the companies are playing “a dangerous game” by engaging with sanctioned individuals, especially in light of the ongoing trade negotiations between the EU and the US over tariffs.

And although Washington has been silent, Vizgirda said the US could bring up this case if any circumstances change.

Read more: US puts Latvian mayor under sanctions

Meanwhile, Mayor of Ventspil Aivars Lembergs was placed under US sanctions in December last year together with the Ventspils Freeport Authority where he was the director.

The oligarch had been the mayor of Ventspils since 1988.

Lembergs was accused of large-scale corruption and was added together with the Latvian companies in the so-called Magnitsky list.

Read more: Magnitsky a symbol of sanctions – and not just in Russia

Lithuania passed the so-called Magnitsky Laws in November 2017 using the precedent set by the US senate. The laws bar individuals connected to large scale corruption, money laundering, or human rights abuses from entering the country.

The US sanctions had a crippling effect on the Latvian port, according to Artūras Drungilas from the state-owned port of Klaipėda in Lithuania.

The number of goods moving through Ventspils port fell by 47 percent. According to Drungilas, swift reaction by the Latvian government and the country’s diplomats led to Lembergs being dismissed from his position at the port just nine days later. The US then removed the port from the sanctions list.

Read more: Latvian municipal companies caught in US sanction turmoil

The US sanctions are split into several dozen programmes covering different issues and countries.

For example, the Iranian airlines Mahan Air have been under US sanctions since 2011, and although the US called for action, the company had continued flying to Europe.

Only after US President Donald Trump announced his ‘maximum pressure’ campaign against Iran in 2019, the Italian and Geman leaders said they would bar Mahan Air flights.

The lawyer Daujotas told LRT FACTS that Lithuania has “all the means to initiate new EU sanctions,” but since they would involve economic and financial measures, it would have to be done via the European Council “which is even a more difficult and lengthy procedure''.

Read more: Lithuanian parliament seeks EU sanctions on 'Putin's chef'

Although Avia Solutions Group is right to say there are no restrictions preventing Prigozhin’s plane from landing in Vilnius, it would be wrong to assume it’s a diplomatically insignificant event.

Read more: Bust spies, fine Facebook, foster elves: how to counter Russia’s actions – report

US institutions have warned of risks associated with providing services to Prigozhin's aircraft. Lithuanian companies that partake in “significant” contracts could risk secondary sanctions, and although applying such sancitons is a complicated process, they could potentially be used in isolated cases. Tadas Vizgirda from the American Chamber of Commerce in Lithuania also said circumventing US sanctions sends a diplomatic signal that could harm Lithuania’s reputation in the US in the future. The example in Latvia also shows that EU countries can decide to follow US sanctions, without the need for EU-wide action. LRT FACTS also found that only Avia Solutions Group can service the type of aircraft owned by Prigozhin.