CORPORATE HOSTILE TAKEOVERS

Privatization Reforms, Property Rights,

and

Predatory Raiders
in

Post-Soviet Russia

Ararat L. Osipian

CORPORATE HOSTILE TAKEOVERS

Privatization Reforms, Property Rights, and Predatory Raiders in Post-Soviet Russia

Ararat L. Osipian

Osipian, Ararat L. Corporate Hostile Takeovers: Privatization Reforms, Property Rights, and Predatory Raiders in Post-Soviet Russia. : Press, 2012. This book presents theoretical and empirical investigation of the phenomenon of corporate hostile takeovers and its impact on the process of legitimization of private property rights and development of market institutions in Russia. Privatization reforms, property rights, and predatory raiders in post-Soviet Russia correspond to such notions as virtual reality, volatile rights, and violent raiding. This research defines corporate raiding and addresses main organizational structures of raiding. A substantial part of the book is devoted to the integrative scholarly synthesis. Key words: hostile takeover, legitimacy, privatization, property rights, raiding, Russia JEL codes: I22, K42, P26, P31, P37 The book is intended for professors, scholars, graduate students, students, public officials, leaders of NGOs and businesses, all who are interested in issues of raiding, corruption, and privatization. Osipian, A.L., 2012

Exit data: Manuscript is completed, 101,000 words, 13 tables, 2 figures. Status: Under review.

PREFACE Barbarians at the Gate! A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty. Winston Churchill Barbarians at the gate! Today they are gathering at the gates of factories and plants, housing condominiums, collective farms, banks and insurance companies and numerous other enterprises, firms, and organizations. Who are these aggressively looking men in black or khaki uniforms wielding clubs and batons, spreading tear gas, jumping over fences and ramming gates? These are Russian raiders. Why do they climb the walls, jump into windows, break through office doors into directors quarters, and roll top managers out of their offices along with their leather armchairs? Because they take over the key positions: the directors office, accounting, and gates and checkpoints. They secure the perimeter to let their people in and to move the now previous owners out. This is called corporate hostile takeover the way it is done in Russia. Iron gates and fireproof safes are unlooked with electric saws and sledge hummers in order to gain access to seals, documents, charters, and cash. It is relatively easy to explain such a dramatic raiding spectacle to an unaware bystander, but it is much harder to understand and explain what is in the background of such swift violent storming actions and battles for property. This book will attempt exactly this, the explanation of fundamentals that lie beneath the bold manifestations of corporate hostile takeovers and other types of raiding. More than two decades into the market reforms, the Russian Federation (RF) is still in the process of creating and developing its market institutions. Russian economy is the fifth largest economy in the world, sharing this spot with Germany, faces serious challenges when it comes to such issues as legitimacy of property and protection of property rights. Raiding along with corruption is the number one problem in Russia, which worries not only domestic entrepreneurs, but also foreign investors. According to some accounts, this problem after the financial crisis of 2008 has worsened. In addition to production facilities, real estate and land are major targets of raiders. Raiding goes far beyond bankrupt private enterprises. Raids are organized against the state enterprises and state property as well. Essentially, anything of value is potentially an object for a raider attack. As Moscow stays in the top ten world capitals to do business in and to invest, Russian raiders may certainly pretend on a top place in the ranking of world raiding, if such would exist. A quarter century ago, at the development of Gorbachevs Perestroika in 1987, cooperatives and so-called small enterprises manifested the legalization of private property in the USSR, very little and tightly restricted and controlled, and yet private. This was not a genuinely private property, but rather a quasi-private property, tightly controlled by the state and oftentimes assaulted by criminals, including first of all racketeers. It was explained in part by the lack of proper regulatory frame and market environment. There was a clear lack of market institutions, indeed. However, in 2012, there are still plenty of problems with property rights which owners of private property face frequently, and the major blame continues to be placed on that same lack of market institutions.

Institutions are called to minimize transaction costs; they are for sure useful market agents. But what about raiders? Do they threaten the system of property rights, or do they make strongest market players to survive and prosper while weeding out weaker ones? This book intends to clarify whether raiders can be considered as positive and useful market agents. Is it true that raiders in Russia act not only in their own best interest, but also to the benefit of the economic system overall? Do raiders strengthen the national economy by weeding out weak firms? Do raiders serve as market cleaners, especially after the crisis? This book also considers institutional aspects of raiding, including the role of commercial arbitration courts and bankruptcy procedures in Russia. Privatization reforms, property rights, and predatory raiders in post-Soviet Russia, placed in the title of this book, correlate with such notions as virtual reality, volatile rights, and violent raiding. Indeed, this set of notions may be positioned as parallel to the title line. Privatization was done through the creation of virtual reality, when every Soviet state-owned enterprise was reproduced in a parallel dimension called title of property. Shares, privatization vouchers, auctions and other tools were used to manipulate the status of these enterprises through their virtual being or virtual dimension. Private property rights in Russia are still not well-protected. They are vulnerable to both the state and criminal groups and dishonest entrepreneurial raiders. Thus, private property rights are strongly associated with the notion of volatility. Volatile rights to private property do not let owners sleep well. They lost their sleep in part thanks to the growing threat of predatory and aggressive raiding. Raiders in Russia are not those met in the West: they do not limit themselves to the Wall Street strategies and tactics of acquiring shares. Instead, they often resort to violence. Violent crimes, related to private property, including order killings of heads of targeted companies, are no longer exceptionally rare. The use of violence during the storming of offices and enterprises gives justification to associating the notion of violent raiding with raiding actions that take place in Russia. Property relations are indeed the key in understanding the phenomenon of raiding. Property rights were formed and transformed through the processes of distribution and redistribution of property. The move from predatory lending to predatory raiding signifies the transition from more civilized to more violent forms of property redistribution. In addition, state agencies act similar to raiders: they take property from citizens and turn it to new owners. Sometimes Raiders are coming means collector agencies at work. Terms democratization and disintegration are now being replaced with capitalization and commercial dispute resolution. Corporate raiding as we know it is the way it is presented in western research. Here, golden parachutes and poison pills are included in the defensive strategies of western firms designed to oppose hostile takeovers. Problem of raiding in works of Russian scholars is not well-described, and in addition, some large cases of corporate hostile takeovers, such as those of Yukos, TogliattiAzot, and Vympelkom, receive a fair amount of the media attention. Organizational forms of raiding in Russia include a familiar structure of client, organizer, and executor. It is hard to say who the real raider is: the client who orders the raiding, the organizer who designs the raiding project and sets the whole thing in motion, or the executor, who actually put it into action. Not all corporate raids in Russia are done in business offices and law firms; some, in fact many, remind chronicles of ancient sieges or the war of high fences with foot soldiers and firepower. While foot soldiers or storm troopers and trial lawyers are the front men, there are deeply entrenched institutional actors as well. Prices on raiding and related services, which are sometimes mentioned in the media and surfaced in the reports on raiding in the form

of price-lists, point to a strong institutional component of Russian raiding. Private security firms (ChOPs) and the Ministry of the Interior (MVD) exercise their right to defend property from raiders and equally so when it comes to defeating the rightful owners. ChOPs promise a better protection of property rights to you personally, while Putin promises it to everyone, to the nation as a whole. However, the war against raiding, declared by the state, is about as successful as the war against corruption, if the word success is at all appropriate in this context. The future of raiding is not as bleak as some state officials like to picture. Waves of raiding activities follow the waves of privatization and financial crises. Privatization in Russia continues, and so does raiding. Similar to the Russians are Coming expression, set in minds of people in the West during the Cold War era, Raiders are Coming came to the annals of the Russian modern history for a long time. Opportunistic behavior of raiders and foreign investors is alike. Russian business climate is harsh, but those who see the opportunity in it may eventually succeed.

TABLE OF CONTENTS

INTRODUCTION I. CORPORATE RAIDING: THEORETICAL GROUNDS AND RECENT DEVELOPMENTS II. WHO STOLE MY PLANT?: ORGANIZATIONAL AND INSTITUTIONAL ASPECTS OF RAIDING III. GIVING HAND OF THE STATE: LEGITIMACY OF PROPERTY AND ILLEGALITY OF RAIDING IV. ARE RAIDERS PREDATORS?: PRIVATIZATION REFORMS AND CRISIS RAIDING V. FABERGE EGGS REVISITED: CHANGING VALUE, CHANGING HANDS VI. FUTURE OF RAIDING: RAID THE RAIDERS VII. FOREIGN CONNECTION: RUSSIAN STATE AND RUSSIAN EXILES CONCLUSION REFERENCES APPENDICES

TABLE OF CONTENTS Preface LIST OF TABLES LIST OF FIGURES INTRODUCTION I. CORPORATE RAIDING: THEORETICAL GROUNDS AND RECENT DEVELOPMENTS 1.1. Corporate raiding as we know it Raiding in western research Golden parachutes and poison pills: defensive strategies of western firms 1.2. Corporate raiding in Russia Problem of raiding in works of Russian scholars Big cases: TogliattiAzot, Vympelkom 1.3. Concluding remarks II. WHO STOLE MY PLANT?: ORGANIZATIONAL AND INSTITUTIONAL ASPECTS OF RAIDING 2.1. Organizational forms of raiding: client, organizer, and executor A fellow who knows what hes about Chronicles of ancient sieges or the war of high fences 2.2. Foot soldiers and firepower: prices on raiding services ChOPs and MVD: the right to defend Prices on raiding and related services 2.3. Concluding remarks III. GIVING HAND OF THE STATE: LEGITIMACY OF PROPERTY AND ILLEGALITY OF RAIDING 3.1. The invisible hand of the market and indivisible hand of the state State as an instrument of legitimization and raiding Revision of privatization results as a gift to the raiding movement 3.2. The invisible hand of the market and invincible hand of the raider Transaction costs and forest wolfs Legitimacy of property and re-nationalization 3.3. Concluding remarks IV. ARE RAIDERS PREDATORS?: PRIVATIZATION REFORMS AND CRISIS RAIDING 4.1. Privatization: virtual reality, volatile rights, and violent raiding Chronology of raiding: waves of privatization Privatization as unequal distribution of property 4.2. Predatory raiding in Russia: institutions and property rights after the crisis Bankruptcy and the role of commercial arbitration courts 4 9 10 11

15 15 15 21 24 24 29 32

35 35 35 40 42 42 48 49

52 52 52 56 64 64 68 77

80 80 80 82 86 86

Bankruptcy dynamics in Russia: external management, auctioning and liquidation 4.3. Concluding remarks V. FABERGE EGGS REVISITED: CHANGING VALUE, CHANGING HANDS 5.1. The Czars Faberge Eggs: assets appreciate, oligarchs depreciate Economic sociology of raiding or Faberge eggs from David Woodruff Private interest versus social responsibility 5.2. Putin 2.0: re-industrialization and tax maneuvering Barbarians at the gate: forced deindustrialization and evolution of grey markets Putins tax maneuver and windfall tax: workout, bailout, or payback 5.3. Concluding remarks VI. FUTURE OF RAIDING: RAID THE RAIDERS 6.1. Future of raiding: the fall of anti-raider Reactive character of raiding and anti-raiding Post-privatization and crisis raiding 6.2. Privatization reloaded: back to the future Show must go on: privatization continues From invisible hand of the market to the iron fist of raiders 6.3. Concluding remarks VII. FOREIGN CONNECTION: RUSSIAN STATE AND RUSSIAN EXILES 7.1. Internalization of values and hierarchical changes Pulling the rug out from under their feet: land as an instrument of raiding Horses on the river crossing: from Russel to Rossel 7.2. Externalization of assets and disputes Russian London: how business tycoons turn political exiles Dog barks, but the caravan proceeds 7.3. Concluding remarks CONCLUSION APPENDICES Appendix I Appendix II REFERENCES AUTHOR INDEX SUBJECT INDEX About the author

90 95 97 97 97 105 109 109 111 118 121 121 121 126 132 132 136 143 146 146 146 148 153 153 164 167 169 174 175 182 187 201 204 217

LIST OF TABLES

TABLE PART II 2.1. Types of economic crimes in Russia, 2010 PART III 3.1. National Wealth in Russia, 2000-2007, (as of the beginning of the year; current prices; billion Russian rubles) 3.2. Sources of income of population in Russia (percentage of respondents), 1999-2004 PART IV 4.1. Work of the Commercial Arbitration Court system in the RF, 1992-2011 4.2. Bankruptcy cases in the Commercial Arbitration Court system in the RF, 1998-2011 4.3. Bankruptcy cases in the Commercial Arbitration Court system in the RF, 1998-2011: financial recovery and external management Appendix I Table 1. National Wealth in Ukraine, 2000-2007, (as of the beginning of the year; current prices; billion hrivnas) Table 2. National Wealth in Belarus, 2000-2007, (as of the beginning of the year; current prices; billion Byelorussian rubles) Table 3. National Wealth in Kazakhstan, 2000-2007, (as of the beginning of the year; current prices; billion tenge) Table 4. National Wealth in Moldova, 2000-2007, (as of the beginning of the year; current prices; million lei) Table 5. National Wealth in Kyrgyzstan, 2000-2007, (as of the beginning of the year; current prices; billion soms) Table 6. National Wealth in Azerbaijan, 2000-2007, (as of the beginning of the year; current prices; billion manats) Table 7. National Wealth in Tajikistan, 2000-2007, (as of the beginning of the year; current prices; million somoni)

Page

45

61 76

89 90 93

175 176 177 178 179 180 181

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LIST OF FIGURES

FIGURE PART II 2.1. Structure of a raiding organization PART IV 4.1. Bankruptcy cases in the Commercial Arbitration Court system in the RF, 1993-2011

Page

39

91

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INTRODUCTION By the way, DEstourville, are you perfectly sure of retaining the property? You should take steps to perfect your title to it; so far as I now remember, the king did not give it to you, after all. He did not give it to me, true, Replied the provost with a laugh, but he let me take it, which is much the same thing. Undeceive yourself my dear provost, undeceive yourself; the Hotel de Nesle is no longer your property at this moment Alexandre Dumas. Ascanio. 1899.

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APPENDICES

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Appendix I National Wealth of the Former Soviet Republics, 2000-2007 Table 1. National Wealth in Ukraine, 2000-2007, (as of the beginning of the year; current prices; billion hrivnas) 2000 2001 2002 2003 2004 2005 2006 2007 Fixed assets at book value as of the beginning of the year 823.7 892.2 942.5 985.8 1081.5 1204.0 1437.9 1842.4 as of the end of the year 828.8 915.5 965.7 1026.2 1141.1 1276.2 1568.9 2038.1 at residual value as of the beginning of the year 473.0 482.5 500.4 512.1 543.0 603.4 678.9 824.4 as of the end of the year 466.4 503.3 512.7 538.8 587.5 661.6 774.5 987.2 Inventories as of the beginning of the year 85.3 96.8 115.4 122.5 ... ... ... as of the end of the year Household consumer durables at historic cost 12.2 15.5 19.8 55.2 ... ... ... ... as of the beginning of the year as of the end of the year at residual value as of the beginning of the year as of the end of the year Source: Statistical Yearbook. Interstate Statistical Committee of the Commonwealth of Independent States. Moscow, 2009.

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Table 2. National Wealth in Belarus, 2000-2007, (as of the beginning of the year; current prices; billion Byelorussian rubles) 2000 2001 2002 2003 2004 2005 2006 2007 Fixed assets at book value as of the beginning of the year 28764 86570 116129 152547 192456 235329 243395 297433 as of the end of the year1 86570 116129 152547 192456 235329 243395 297433 341880 at residual value as of the beginning of the year 14612 45173 58867 75486 93992 115587 119924 152936 as of the end of the year 45173 58867 75486 93992 115587 119924 152936 180708 Inventories as of the beginning of the year 7219 7601 11364 14984 20154 25778 32934 38881 as of the end of the year 7496 11396 15345 20760 25746 31292 41636 49362 Household consumer durables at historic cost as of the beginning of the year 644 1713 3772 6553 10223 14507 21503 29689 as of the end of the year 1785 3988 7039 11182 15882 23744 33069 44001 at residual value as of the beginning of the year 587 1542 3315 5501 8374 11389 16896 23191 as of the end of the year 1542 3315 5501 8374 11389 16896 23191 30725 1 Taking into account revaluations of fixed assets Source: Statistical Yearbook. Interstate Statistical Committee of the Commonwealth of Independent States. Moscow, 2009.

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Table 3. National Wealth in Kazakhstan, 2000-2007, (as of the beginning of the year; current prices; billion tenge) 2000 2001 2002 2003 2004 2005 2006 2007 Fixed assets at book value as of the beginning of the year 3044 3509 4026 4883 5707 6937 9332 11366 as of the end of the year 3402 4004 4883 5707 6628 8426 11478 13943 at residual value as of the beginning of the year 2134 2465 2921 3477 3870 4591 5691 7255 as of the end of the year 2392 2678 3413 3870 4296 5273 6818 8677 Inventories as of the beginning of the year 302 374 597 614 886 1139 ... as of the end of the year 383 457 726 698 1139 1828 ... Household consumer durables at historic cost as of the beginning of the year 256 293 445 556 691 852 ... as of the end of the year 293 445 556 691 852 1021 ... at residual value as of the beginning of the year 198 227 318 408 500 618 ... as of the end of the year 227 324 408 500 618 735 Source: Statistical Yearbook. Interstate Statistical Committee of the Commonwealth of Independent States. Moscow, 2009.

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Table 4. National Wealth in Moldova, 2000-2007, (as of the beginning of the year; current prices; million lei) 2000 2001 2002 2003 2004 2005 2006 2007 Fixed assets at book value as of the beginning of the year 91223 91823 87075 97778 103098 106241 112221 124979 as of the end of the year 91319 95009 100914 101890 106761 112502 125225 137252 at residual value as of the beginning of the year 50228 50505 49069 61817 57741 60505 58058 67347 as of the end of the year 49984 52582 54835 55657 57342 62184 66010 73626 Inventories as of the beginning of the year 6324 7628 8825 9863 13168 16031 23815 27757 as of the end of the year 7785 9044 9883 13334 16265 20493 24470 37788 Household consumer durables at historic cost as of the beginning of the year 2855 3890 5139 6834 8017 9040 10614 11506 as of the end of the year 3890 5139 6834 8017 9040 10614 11505 15310 at residual value as of the beginning of the year 2101 3008 3947 5052 5525 6280 7727 8576 as of the end of the year 3008 3947 5052 5525 6280 7727 8576 11761 Source: Statistical Yearbook. Interstate Statistical Committee of the Commonwealth of Independent States. Moscow, 2009.

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Table 5. National Wealth in Kyrgyzstan, 2000-2007, (as of the beginning of the year; current prices; billion soms) 2000 2001 2002 2003 2004 2005 2006 2007 Fixed assets at book value as of the beginning of the year 108.2 117.1 138.2 158.4 166.8 190.9 212.8 243.5 as of the end of the year 116.4 124.7 147.2 164.8 183.9 213.2 238.8 278.2 at residual value as of the beginning of the year 86.6 93.7 85.5 112.9 114.9 130.5 145.4 169.2 as of the end of the year 89.3 95.2 88.7 111.2 124.0 143.2 163.3 192.3 Inventories as of the beginning of the year 21.2 13.6 14.2 15.1 15.8 17.7 19.5 20.2 as of the end of the year 13.6 14.0 15.3 16.6 17.9 19.5 21.7 26.7 Household consumer durables at historic cost as of the beginning of the year 23.7 29.7 40.7 61.5 65.2 as of the end of the year 29.7 39.6 61.5 65.2 66.3 at residual value as of the beginning of the year 18.5 23.4 30.1 48.9 49.5 as of the end of the year 23.4 31.1 48.9 49.5 48.2 Source: Statistical Yearbook. Interstate Statistical Committee of the Commonwealth of Independent States. Moscow, 2009.

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Table 6. National Wealth in Azerbaijan, 2000-2007, (as of the beginning of the year; current prices; billion manats1) 2000 2001 2002 2003 2004 2005 2006 2007 Fixed assets at book value as of the beginning of the year 84870 100373 105309 112195 127062 145282 33939 43192 as of the end of the year 90698 104798 111572 127062 145228 169696 40641 50183 at residual value as of the beginning of the year 51471 55958 54983 54730 65003 74418 18382 24537 as of the end of the year 54651 55734 54487 60749 73950 91004 22900 29904 Inventories as of the beginning of the year 4827 3481 3492 6590 7200 8349 28 30 as of the end of the year 3481 3492 6590 7200 8349 12777 30 36 Household consumer durables at historic cost as of the beginning of the year 7322 7779 9186 11893 14185 17160 4167 5237 as of the end of the year 7782 9392 11827 14185 17153 20833 5237 6874 at residual value as of the beginning of the year 5018 5908 6632 8490 9928 12642 2984 3777 as of the end of the year 5914 6962 8426 9928 12636 14925 3777 5026 1 Since 2006 - mln. Mantas Source: Statistical Yearbook. Interstate Statistical Committee of the Commonwealth of Independent States. Moscow, 2009.

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Table 7. National Wealth in Tajikistan, 2000-2007, (as of the beginning of the year; current prices; million somoni) 2000 2001 2002 2003 2004 2005 2006 2007 Fixed assets at book value as of the beginning of the year 1478.2 1585.0 3682.5 5778.6 6031.7 6700.1 7355.4 7913.9 as of the end of the year 1585.0 1745.7 5778.6 6031.7 6203.1 7355.4 7913.9 8909.9 at residual value as of the beginning of the year 799.2 850.6 2264.9 4347.4 3790.4 3920.3 3281.3 3360.3 as of the end of the year 850.6 919.4 4347.4 3790.4 3920.3 3281.3 3262.9 3483.3 Inventories as of the beginning of the year 267.0 434.1 584.7 875.0 1212.1 1788.3 2186.9 2816.7 as of the end of the year 390.6 446.3 745.0 1158.1 1770.1 1920.0 2555.1 2950.2 Household consumer durables at historic cost as of the beginning of the year 0.9 1.5 2.9 3.1 4.7 7.2 9.5 14.7 as of the end of the year 1.0 2.0 3.1 4.7 7.2 9.5 14.7 29.4 at residual value as of the beginning of the year as of the end of the year Source: Statistical Yearbook. Interstate Statistical Committee of the Commonwealth of Independent States. Moscow, 2009.

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Appendix II Documented evidence of raiding in the former Soviet republics that includes video chronic and brief description materials is presented in Appendix II. The more extensive data and documented evidence of raiding and corruption in the former Soviet Union is presented in compilation of web materials. Raiding of a large business Headquarters of Lenta, one of the largest retail chains in Russia, are being stormed by raiders. St Petersburg, Russia, September 29, 2010. http://www.youtube.com/watch?v=6XMa1oXk4I0&feature=player_embedded http://www.youtube.com/watch?v=tdF4Ks6Mewk&feature=related http://www.youtube.com/watch?v=g0yyr6M_c9s&feature=player_embedded#! http://www.youtube.com/watch?v=aO119CA6Tj8&feature=player_embedded#! http://www.youtube.com/watch?v=bnGOcHaBbHY&feature=player_embedded http://www.youtube.com/watch?v=g0yyr6M_c9s&NR=1 http://www.youtube.com/watch?v=TqF_Osbutbs&feature=player_embedded#! http://readrussia.com/magazine/Winter2010/00061/ Raiding of a medium businesses A dispute over a TV company in Tula turns into a criminal investigation. A group of armed people is storming premises of the company in an apartment building. There are around 50 storm-troopers involved in the storming. Police does not interfere but calls for backup support. More police arrives later and stops the storming, arresting 35 perpetrators. 81 Gogolevskaya Street, Tula, Russia, July 31, 2008. http://mreporter.ru/ReporterMessages!viewReport.do?reportid=14308 http://www.youtube.com/watch?v=K0Zf1nN-3m0&feature=related http://www.youtube.com/watch?v=n2qAMmHDMuA Police are storming a private bank Guta-kapital, using axes and sledge hummers, braking in through the bullet proof glass, and arresting private security. Police is also attempting to get through armored doors. It is unclear why the police are performing locksmith functions. Moscow, Russia, April 15, 2007. http://www.ochevidets.ru/rolik/7551/ This is a hostile takeover of a large public utilities enterprise Teplokommunenergo in Rostovskaya oblast, Russia, on May 27, 2010. http://www.youtube.com/watch?v=yi22U4pXOk Hostile takeover of Angarskcement cement plant in Siberia, Russia, in February 2006. http://rutube.ru/tracks/1431294.html?v=635ffea061d1f457d0068014a1b64a91 Somewhere in Russia. Storm-troopers on two buses arrive to a porcelain factory and move in. August 2006. http://rutube.ru/tracks/1448362.html?v=de86dfd56af302f2e5d8b6ddb87f8a29

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Raiding of large markets Hundreds of police special forces secure the way for construction machines that move in to demolish Khasansky market in St Petersburg, Russia. The market gives jobs to over 3,000 people. Babushkas in their pre-revolution era fur coats and hats, who work as salesmen on the market, fight the police storming squad. St Petersburg, Russia, February 9, 2010. http://www.youtube.com/watch?v=ET1XaBCM3_4&feature=related http://www.youtube.com/watch?v=uxUmTVDj4Xs http://www.youtube.com/watch?v=JTqngw2LLZQ&feature=related Hundreds of salesmen move to defend their business from demolition. They block the way for construction machines. http://www.youtube.com/watch?v=enlQX2qj88E Large trucks carry concrete shields to be used as a construction site fence. Police colonel explains people the court decision. Police fail to clear the way for trucks and call for back up. http://www.youtube.com/watch?v=VU-yuAIWSSg Babushkas fight the police and shout Shame! Shame! http://www.youtube.com/watch?v=3EFmHaa3aBE http://www.tv100.ru/news/Na-Hasanskom-rynke-idut-boi-20541/ Police conduct arrests of resisting market salesmen. http://www.youtube.com/watch?v=JTqngw2LLZQ Construction machines move in. http://www.youtube.com/watch?v=D5xAheBfI7c More arrests follow. http://www.youtube.com/watch?v=uxUmTVDj4Xs Market Druzhba in Surgut, Siberia, Russia, is being closed by the court bailiffs three times due to violations of fire safety requirements in some of its warehouses. Tenants of the market and its management consider it as raiding. Surgut, HMAO, Russia, August 2009, December 2009. http://www.youtube.com/watch?v=vVU53bOTrhI&feature=related http://www.youtube.com/watch?v=vVU53bOTrhI A massive storming and fight in the market in Severnoe Butovo, Moscow, August 4, 2008. Raiders occupy administrative premises of the market and later the salesmen attempt to storm the second floor to regain control. http://www.youtube.com/watch?v=_1MruOJOWkM&feature=related Izhevsks central market, Izhevsk, Russia. http://rutube.ru/tracks/2915664.html?v=684c60f05dc23be5b92c1d33f65eddf0 A swift change of the director on Izhevsks central market, Izhevsk, Russia. http://rutube.ru/tracks/2915664.html Construction, developers, and land raiding This is the confrontation over a large construction site in Kadashi, downtown Moscow, Russia. This is a longstanding battle that went on in May, June, July, and August of 2010. Kadashi is a historical area of Moscow that has buildings of 17th, 18th and 19th centuries. Civil activists use MPs to fight private security hired by the developer.

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http://www.youtube.com/watch?v=jgb_UH9QUuQ&NR=1 http://www.youtube.com/watch?v=Uo4IXCWplh8&NR=1 http://www.youtube.com/watch?v=DdXwwgm0PlY http://rutube.ru/tracks/3311431.html?v=561ade38a1a186aae18471f9105c577e http://www.youtube.com/watch?v=eqTPtqlPzns&feature=related http://www.youtube.com/watch?v=IDKmjTLFg2E&feature=related http://www.youtube.com/watch?v=LuZq3X32HZY&feature=related http://www.youtube.com/watch?v=O_KoVAsl5JA&feature=related http://news.mail.ru/video/3946902/ Dwellers of nearby apartment complexes fight developers and block construction machinery. This is a first storming. 68 Amundsen Street, Yekaterinburg, Russia, July 5, 2010. http://www.uralweb.ru/video/video.php?id=10848 The storm-troopers let the construction cranes to move in. Dwellers of nearby apartment complexes fight developers. This is a second storming. 68 Amundsen Street, Yekaterinburg, Russia, August 5, 2010. http://www.youtube.com/watch?v=PDOoVn4msY&feature=player_embedded Dwellers of nearby apartment complexes fight developers. This is a third storming. Up to two hundred of private security personnel are involved and only few dozens of dwellers resist to them. 68 Amundsen Street, Yekaterinburg, Russia, September 21, 2010. http://www.f1movies.net/video/ON_YywVCwrM/--3-.html http://www.youtube.com/watch?v=fJLgHGADPCA Russian babushkas in fur coats keep fighting the police and storm-troopers. Yekaterinburg, Russia, October 4, 2010. http://e2-e4.tv/f/news/4channel/2010/10/04/tochechnaya_zastroyka_v_ekaterinburge_voyna_mejdu_zastroysch.html The police officer tells babushkas that he is there to make sure that they do not get mugged (by the storm-troopers), to what they respond that they are going to mug him. Yekaterinburg, Russia, October 4, 2010. http://www.ntv.ru/novosti/205297/ Police special forces fight private security storm-troopers over the construction site in 19 Smirnovskaya street, Moscow, Russia. http://smotri.com/video/view/?id=v1725717b5f Dwellers of nearby apartment complexes fight developers and police. They are against construction near 41 Marshala Biryuzova Street, Moscow, on August 17, 2007. http://www.youtube.com/watch?v=dbzwbHpyWXM&feature=related http://www.youtube.com/watch?v=DImwZy_57_w&feature=related Court bailiffs arrive to the wrong address and start demolishing of the building without proper court decision. A crowd of people move in and fight court bailiffs in order to stop the demolition. Gelenjik, Sochi, Russia. This might be a fight for expensive land in a resort area on the Black Sea cost. http://www.youtube.com/watch?v=NJbLmp3jLH0&feature=related A court ordered demolition of houses in Rechnik community in Moscow. The demolition was later ruled unlawful. Owners of the houses resist the police and create obstacles for demolition.

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Moscow, Russia, January 21, 2010. http://www.youtube.com/watch?v=1xAcG9blLtk http://www.rian.ru/video/20100122/205748650.html http://www.rian.ru/society/20100121/205571084.html http://www.youtube.com/watch?v=01dYQoriBeg&feature=related http://www.youtube.com/watch?v=TEHz88VBCyk&feature=related A developer wants to build up two additional floors at the top of an old five-story building. Tenants of the building resist the construction while the storm-troopers block the house and break the gates. 12 Millionnaya Street, St Petersburg, Russia, November 7, 2009. http://www.gazeta.spb.ru/215043-0/ http://newnum.ru/article/114820/7d85/ http://www.tv100.ru/video/view/19665/ A developer fights with the locals over the parking lot, now intended for construction. The excavator digs the ground around parked cars. 61 Roshchinskaya Street, Yekaterinburg, Russia, November 16, 2010. http://e2e4.tv/m/news/4channel/2010/11/16/protivostoyanie_jiltsov__i_zastroyschika_privelo_k__massovay.html Raiding in agriculture A fight for agricultural fields between the storm-troopers of Moscow-based Prodimeks-Holding and an agricultural enterprise in Voronezhskaya oblast. There were nine wounded in the shooting. Voronezh, Russia, summer 2009. http://www.youtube.com/watch?v=Qv8mm2uZy0&NR=1 A group of 25 to 30 men occupies joint-stock company Russia, located on 91 Krylova Street, Stanitsa Ilinskaya, Novopokrovski rajon, Krasnodarski krai, Russia. They move in a new owner of the enterprise. Then, employees, including a number of old ladies, try to storm in and take over the building. They fight the newcomers and the police. Police is trying to separate the confronting sides. The event takes place on March 4, 2010. This is one of those battles where one can observe the spirit of Russian babushkas. http://www.youtube.com/watch?v=IYIOWEnHSlU Hostile takeover of a large agricultural enterprise Zaporozhskoe in Krasnodarski Kraj, Russia. Workers storm in, remove raiders, and take over the enterprise. October 25, 2009. http://www.youtube.com/watch?v=q4Nq6TnY5YY&feature=player_embedded http://www.youtube.com/watch?v=WmVq7lPmYQw&feature=player_embedded#! http://www.youtube.com/watch?v=KoLg9tVOw38&feature=related http://www.youtube.com/watch?v=q4Nq6TnY5YY&feature=related http://www.youtube.com/watch?v=XVFBApRQuRQ http://chelovekizakon.ru/narodniy-reporter/20091105/rejderskij-zaxvat-oao-zaporozhskoe-518 A business of a farmer and local entrepreneur is being assaulted at noon in Bolsha ya Talda, Kemerovskaya oblast, Kuzbass, Russia, on July 7, 2010. The businessman survived 40 gun wounds while his son was nearly killed by an axe. http://www.youtube.com/watch?v=68FOLpgBRwo

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Politically motivated raiding Members of the National Bolshevik Party (NBP) became famous in part because of the boldness of their swift takeovers of some state offices. On August 2, 2004, in Moscow, a group of around thirty members of National Bolsheviks rushed onto the premises of the Ministry of Healthcare and barricaded themselves in three offices, including the office of the Minister. Portrait of Putin is being thrown out of the window. This action was in protest to the Law On monetization of subsidies. Police reacted immediately and vacated the premises. A court sentenced seven of the NBP raiders each to five years in prison. Some of the bystanders protested the arrest. One old lady called a police major a Scumbag, to which he replied I am not a scumbag. I am a major. She was also arrested. Moscow, Russia, August 2, 2004. http://www.youtube.com/watch?v=TJWzQKfw7k4&feature=related Members of the National Bolshevik Party (NBP) took over the roof of the Ministry of Justice building. Moscow, Russia, December 3, 2003. http://www.youtube.com/watch?v=GLs94GlVL_E http://www.youtube.com/watch?v=KNQja3yEK-I Members of the National Bolshevik Party (NBP) are storming the headquarters of a Russian oil giant Surgutneftegaz in Moscow, Russia, on November 7, 2006. http://www.youtube.com/watch?v=DedYlk7SZrY&feature=related Police is storming the headquarters of the NBP, quartered in a basement of a large apartment building. Frunzenskaya Street, Moscow, Russia, June 17, 2005. The first storming took place on March 5, 2004. http://www.youtube.com/watch?v=Q88HYW4-zZI Anti-raiding education A HEI in Yekaterinburg, Russia, is developing an academic program on anti-raiding and corporate security and stages raiding and hostile takeover spectacles in order to popularize this program. Yekaterinburg, Russia, 2010. http://www.nakanune.ru/news/2010/08/18/22177459

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AUTHOR INDEX

Agrawal, Anup, Alger, Cristina, Anderson, Noel, Andreeva, E. Andriyanov, Victor, Armour, John, Aslund, Anders, Astakhov, Pavel, Auerbach, Alan J., Baev, O., Bandurin, A., Banerjee, Ajeyo, Baradwaj, Babu G., Barclay, C. Barnatan, T. M., Barnes, Andrew, Belenkaya, O., Belikov, Oleg, Berkovitch, Elazar, Bhagat, Sanjai, Blasi, Joseph, Borisov, Yuri, Bradley, Michael, Byrd, John, W., Calamari, Peter E., Chandratat, Ike, Chang, Saeyoung, Chaplinsky, Susan, Chubais, Anatoly, Coffee, John C., Cooke, T. E., Cundiff, Victoria A., Dahya, J., Dahl, Vladimir, DeAngelo, Harry, Demidova, ., DeMott, Deborah A., Denis, David, Denis, Diane,

Dmitrieva, E., Dolgova, A., Donath, Roland, Drucker, Peter, Duggal, Rakesh, Dugin, Aleksandr, Dumas, Alexandre, Dunn, Craig P., Easterbrook, Frank H., Ellwood, J., Faenson, Mikhail, Farrar, John, Ferris, Kenneth, Ferris, Stephen P., Firestone, Thomas, Forsyth, Michael, Franks, Julian, Fraser, Donald R., Frazer, Peter, Froot, Kenneth A., Frye, Timothy, Furtado, Eugene P. H., Gaughan, Patrick, Giammarino, Ronald, Gilson, Ronald J., Gololobov, D., Gutfleisch, Todd A., Harbert, Tam, Harrington, William D., Havrylyshyn, Oleh, Hedlund, Stefan, Heinkel, Robert, Herman, Edward S., Hills, Carl, Hirsch, Paul M. Hirshleifer, David, Hoff, Peter, Hoguet, Laura B.,

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Holl, Peter, Hollifield, Burton, Hrabrova, I., Huang, Yen-Sheng, Huckaby, S. T., Ilin, O., Iontsev, M., Jarrell, Gregg A., Jensen, Michael C., Kashkin, D., Kaynard, Meryl R., Kennedy, V.A., Khanna, Naveen, Kireev, Aleksei, Kiryushkin, Roman, Konstantinov, V., Kragel, B. W., Krichevsky, Nikita, Kroumova, Maya, Kruse, Douglas, Kruse, Timothy A., Kyriazis, Dimitris, Labutin, A., Lambert, Richard A., Larcker, David F., Latov, Yuri, Ledeneva, Alena, Limmack, R.J., Long, Michael S., Lopashenko, N., Lowenstein, Louis, Luchin, V., Lustig, Eric, A., Luther, R. G., Magenheim, Ellen B., Mahoney, James M., Mahoney, Joseph T., Malatesta, Paul, Mantone, J., Martin, Kenneth J.,

Mayer, Colin, Mazur, Irina, McCarthy, Martha, McChesney, Fred S., McConnell, John J., McGettigan, Donal, McKee, David L., McMillan, John, Meckling, William H., Medvedev, Roj, Micheletto, R. C., Mikkelson, Wayne H., Millar, James A., Milsom, Tony, Molotnikov, A., Montesquieu, Charles-Louis de Secondat, Morgenbesser, Henry I., Mueller, Dennis C., Muscarella, Chris J., Neale, Bill, Nelson, Ralph, Newton, Lisa H., Niden, Cathy M., Niehaus, Greg, Nikonova, Natalya, OReilly, Charles A., Oesterle, Dale A., Osipian, Ararat, Owers, James E., Palmer, D. D., Partch, M. Megan, Pearce, John A., Pearson, B. R., Peters, Rebecca G., Pimanova, Alisa, Pinkerton, Mary, Pinto, Arthur R., Pirani, Simon, Pistor, Katharina, Pivovarsky, Alexander, Polushkin, Oleg, Poulsen, Annette B.,

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Pound, John, Powell, R., Proudhon, Pierre-Joseph, Pushkin, Alexander, Radaev, Vadim, Radygin, A., Raj, Mahendra, Ravenscraft, David J., Reinganum, . ., Reishus, David, Rice, Eugene, Rivman, D., Robinson, Richard B., Roll, Richard, Romanova, A., Rose-Ackerman, Susan, Rosefielde, Steven, Rudyk, N., Rybakova, E., Sachs, Jeffrey Salter, Malcolm S., Sant, Rajiv, Savchuk, S., Schaffer, Frederick P., Scharfstein, David S., Scheier, R. L., Scherer, F. M., Scholes, Myron S., Seligman, Joel, Semenov, A., Sharples, Jane, Shiller, Robert J., Shleifer, Andrei, Shubik, Martin, Sizov, Yu., Skeel, David A., Skidanova, Lilia, Smallbone, David, Smetankina, U., Sonin, Konstantin, Sridharan, . .,

Stammerjohan, William W., Stein, Jeremy C., Sudarsanam, P. S., Tarkhanova, Zarina, Thosar, Satish, Tikhomirov, Boris, Titman, Sheridan, Treisman, Daniel, Varaiya, Nikhil, Varchuk, T., Varnalij, Zakharij, Vetsuypens, Michael R., Vishnevetsky, K., Vishny, Robert W., Vladimirova, I., Volkov, Vadim, Wade, James, Wakeman, L. MacDonald, Walkling, Ralph A., Wallach, Eric J., Walsh, J., Weinhold, Wolf A., Welsh, Robert C., Welter, Friederike, Wolfson, Mark A., Woodruff, Christopher, Woodruff, David, Wooten, R. W., Wright, Mike, Xu, Chenggang, Yakovlev, A., Zhelnorovich, A., Zimmer, Kerstin, Zinatulin, L., Zon, Hans van,

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SUBJECT INDEX

abuse of authority abuse of public office abuse of the office abuse of trust Abyzov, Mikhail Academy of the National Economy access to corporate information accountability administrative barriers administrative law administrative pressure administrative resource aggressive American style tactics aggressive consolidation aggressive corporate takeovers Akademiya narodnogo hozyajstva Akhtubinsk aksakals Aksakov, Valery Alfa-group alienation All-Russian Research Institute Alpatov, Yuri Altay region Altimo amendment American industry American International Group Inc. Analytical Anti-raiding Center Anarchists Anti-abuse anti-corruption anti-raider defense strategies anti-raiding anti-raiding campaign anti-raiding culture anti-raiding law anti-raiding legislation anti-raiding measures antitrust appeals appraisers

appropriation Arbat Arbat Prestige arbitrage managers arbitration business Arkhangelskaya oblast Arms Chamber Ascanio assault capabilities assaults on property assets Astrakhan attempted hostile takeover Attorney General auctioning of municipal enterprises auctioning of state enterprises Auditing Chamber auditors authoritative bureaucratic hierarchy autonomy average bribe Avialesohrana Ayatskov, Dmitry Azerbaijan bailiffs Baku Bakunin, Mikhail Bank Deposit Insurance Agency Bank Moskvy Bank of America Corp. Bank of Moscow bankruptcy bankruptcy cases bankruptcy claims bankruptcy costs Bashkiria Bashkirneft Bashkiroil Bashkortostan Baturina, Elena behavior of minority share-holders

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Belarus Berezovsky, Boris bid rigging bidder black market blackmail Bolsheviks bonus systems branching out breach of contract breaches of financial discipline Brezhnev, Leonid bribe-givers bribery bribes bribe-takers Britain bubbles on the financial market Bukharin, Nikolai Buksman, Alexander bullying Bunin, Igor burden of proof bureaucracy bureaucrat bureaucratic falsifications bureaucratization business ethics business secrets Butyrka buy-backs California capital flight capital market capital markets capital structure changes capitalist production carrying out of the body cash auctions causing nightmares for business Central Asia certificate-based privatization charter amendment chastnoe okhrannoe predpriyatie

Chechnya check privatization Cherkasov, Ivan Chernoj, Mikhail Chichvarkin, Yevgeny child support ChOP Christian Chubais, Anatoly Borisovich Church Church of Christ the Savior civil servants clan closed joint-stock company codes of conduct collection of protection collective farms commercial arbitration court commercial dispute commercial secrets Committee on Government Operations commodity commodity exchange company-aggressor compensation ceilings competition competitors wars complaints complex organization complexity confidential information confiscation of property conflict of interest conflict regulation consolidation conspiracy Constitution Constitutional court construction companies contract killings contract rights controlled subsidiary controlling functions cooperator corporate blackmail

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corporate charter corporate control corporate finance corporate law corporate lawyers corporate mergers and acquisitions corporate raiders corporate raiding corporate restructuring corporate security corruption corruption in courts cost reduction court bailiffs court decisions court injustice court litigation court system cover creditors creditors demands creditors initiated bankruptcies crime crime against property Crimea Crimean peninsula criminal activities criminal aggression criminal aspects of raiding Criminal Code criminal investigations criminal victimology criminalization criminology Cuomo, Andrew DEstourville dacha Dahl, Vladimir debt repayment debtors decision-making default defense strategy delays

democratic principles and processes democratization democrats Department of Land Resources Deripaska, Oleg derivative developers directors of Soviet enterprises disallowed losses disclosure discrepancies discretion disintegration dispersion of property disputes that emerge out of trade relations distribution district courts dividends document fraud dolshchiki dubious court decisions Dubrovinskiy, Alexander Duma DuPont Eastern Europe economic crime economic development economic disputes economic environment economic growth Edinaya Rossiya effective owners effectiveness efficiency eggs Egiazaryan, Ashot Eksmo electricity electronic justice embezzlement emission of stock enclaves Engels, Frederick England

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enterprise entrepreneurial talent entrepreneurship ethics Evroset executive pay expectation of financial gain expropriation external management extortion Faberge eggs fair market price fairness falsifications family relations Far East Farimex Products Inc. FAS Federal Anti-monopoly Services Federal budget federal government Federal Property Agency Federal Security Services Federal Services of Court Bailiffs Federal state unitary enterprise Federal state unitary enterprise Okhrana federal tax codes Federal Tax Services Federalnaya antimonopolnaya sluzhba Federalnaya nalogovaya sluzhba Federalnaya sluzhba bezopasnosti Federalnaya sluzhba sudebnyh pristavov Federalnoe gosudarstvennoe unitarnoe predpriyatie Federation Council FGUP fictitious voucher auctioning FIDE fiduciary duties fiduciary responsibility filings financial bubbles financial crisis of 1998-1999 financial discipline

financial documents financial inspectors financial motivation financial pyramids financial recovery financial scandals financial security financial-industrial group Finansgrup fine Fink, Yuri firm-object of takeover firm-target of takeover First Vice Mayor of Moscow First Deputy Prime Minister flip-in poison pill flip-over poison pill FNS Fond sodejstviya reformirovaniyu ZhKH food processing plants foot soldiers forced labor forceful entry Ford foreign investments foreign investors Forestry Firefighter Aviation Detachment fortification France fraud fraudulent activities free market friendly mergers and acquisitions FSB FSSP Gaddafi, Muammar Gaidar, Egor Timurovich Gazprom GDP Generation Exile Georgia German socially oriented market economy Germany gift

208

golden parachutes Goldman Sachs Group Inc. gopniki Gosduma Greeks greenmail Gref, German gross waste Gruzdev, Vladimir guarantees Gusinsky, Vladimir Gutseriev, Chingiskhan Gutseriev, Mikhail Guvnor Hanty-Mansijsk Head of the Russian Union of Industrialists and Entrepreneurs healthcare HEI hierarchy higher education higher education institution Highest Arbitration Court Highest Court of London holding company hostile corporate takeovers hostile takeovers Hotel Moscow Hotel Moskva Hotel de Nesle housing hubris hypothesis Hungary Icahn, Carl IKEA illegal access illegal act illegal offering illegality Ilyumzhinov, Kirsan immunity imprisonment inadequate disclosure

industrial structure ineffective management inferior management inflation informal earnings information information access privileges information flow information request insider information insiders institutional deficit institutional investors institutionalization institutionalization of raiding institutions Inteko intentional bankruptcy internal corporate policies internal security department international treaties internationalization Internet intimidation Investigations Committee investment fraud investments invisible hand of the market Italy Ivankina, Elena Ivanov, Vyacheslav Japan Japanese corporate law joint stock companies JPMorgan Chase & Co. judges judicial system judiciary branch jurisdiction jurisprudence Kadyrov, Ramzan Kalmykiya Republic Kareliya

209

Kazakhstan Kazan Kemerovskaya oblast Kerimov, Suleiman KGB Khodorkovsky, Mikhail Klimovski plant Meteopribor Knight Frank knowingly fraudulent information Kokh, Alfred Reingoldovich Kommunisticheskij soyuz molodezhi Komsomol koshmarit biznes Kostromskaya oblast Krasnodarsky kraj Kremenchug oil refinery Kremlin Kress, Victor Kudrin, Aleksei Kyrgyzstan labor camps Labor Code Lan land Land Laws of the Russian Federation landlords law enforcement lawful owner laws lawsuits lawyers LDPR Lebedev, Platon legal defenses legal dimension legal disputes legal gaps legal loopholes legal nihilism legal services legality Legislation Committee in the State Duma legislative process legitimacy

legitimacy of authority legitimacy of property legitimacy of state Lenin, Vladimir Leningradskaya oblast Liberal Democratic Party of Russia liberal reforms Liberalno-demokraticheskaya partiya Rossii licenses liquidation liquidity Literary Fund Litvinenko, Alexander loans-for-shares auctions lobbying local authorities Logunov, Oleg London Lower Chamber of the Russian Parliament Luzhkov, Yuri M&A Madoff mafia Makarov, Alexander Makhlay, Vladimir malfeasance management management self-interest hypothesis managerial responses managerial responsibility manipulations market cleaners market economy market of criminal services market reforms market value Martians Marx, Karl Maserati Maski-Show Masks-Show mass privatization McDonalds

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MChS means of production medieval storms Medvedev, Dmitry meetings of creditors meetings of shareholders Member of Parliament merger waves Mergers and acquisitions Merriam-Webster Dictionary Merrill Lynch & Co. metallurgy methodology Middle Ages Mikhalchuk, Ilya military military commissariats Minekonomrazvitiya Ministerstvo chrezvychajnyh situatsij Ministerstvo kultury Ministerstvo vnutrennih del Ministry of Culture Ministry of Defense Ministry of Economic Development Ministry of Emergency Situations Ministry of the Interior minority holders Mironov, Sergei misappropriation Moldova Molotov cocktail monopolization monopoly Moon mortgages mosaic Moskomimushchestvo Moscow Moscow government Moscow Mayor Moscow oblast Moscow oblast Council Moscow region MP Murmansk sea shipping company

Murmanskaya oblast Murmanskoe morskoe parokhodstvo MVD Nabiullina, Elvira NAK Narkomfin Narodny komissariat finansov National Anti-Corruption Committee nationalization Natsionalny antikorruptsionny komitet natural exchange natural monopoly Nauchno-issledovatelsky institut Nazurbaev, Amanga Nekrasov, Vladimir Nemtsov, Boris neoconservatives neoliberals NEP nesuny Nevzlin, Leonid new debt New Economic Policy New York State Attorney General NGOs NII Nizhegorodskaya oblast Nizhny Novgorod Noginsk state enterprise Vtorchermet non-governmental organizations Norilsk nickel norms of professional ethics Nornikel North Caucasus Norway Norwegian telecommunications company Telenor Novaya ekonomicheskaya politika Novgorodchina Novgorodskaya oblast Novodevichij monastery office malfeasance offshore

211

offshore zones oil and gas industry oil pipeline oligarch Olimpstroj On autonomous legal entities On combating corruption On the amendments to Federal Law on supply of products for federal needs open joint-stock company opportunistic behavior Order of the Government of the Russian Federation of November 30, 2009, N 1805-r. organized criminal groups organizer of the raiding Oruzhejnaya palata outsiders overpriced stocks oversight overvalue ownership Panfilova, lena Pastukhov, Vladimir payments pension funds people pill Peoples Commissariat of Finance Peoples Deputy Peredelkino Perestroika Petrograd phenomenon of raiding Pinkov, Aleksandr plaintiff planned economy Podmoskove poison pill Poland police political raiding Popov Institute of Radio Transmitting and Acoustics populism

portfolio investments post-Soviet space post-war phenomenon Potanin, Vladimir Povolzhe Pozgalev, Vyacheslav Prefect preferred stock premium price preservations prevention pre-war period prikhvatization primary accumulation of capital Primorskij kraj private armies private contract enforcement private security firm private security guard privatization privatization vouchers professional ethics profit maximization profit sharing profiteering prohibitive measures Prokhorov, Mikhail proletarians proper purpose closure property disputes property relations property rights protection Proudhon, Pierre-Joseph provisions psychological satisfaction public consciousness public sector public tender offer public utilities publically traded firms Putin, Vladimir puzzle of low productivity racketeer

212

racketeering racketeers raider Raider, novel raiding raiding attacks Raiding in Sankt-Petersburg raiding movement Rakhimov, Murtaza RAN RAO EES rate of return real estate real estate market recapitalization Rechnik Red Tarzan redistribution refinery regulations regulatory function of the state reiderstvo Reiderstvo v Sankt-Peterburge re-nationalization replacement of management re-sale Research Institute resolved claims responsibility restructuring retail trade retaining specialists returned claims revision of privatization results RF Rice, Condoleezza Rosatom Rosbilding Rosbuilding Investment Company Roslyak, Yuri Rosnanoteh Rosneft Rosoboronexport Rossel, Eduard Rossijskaya Federatsiya

Rossijskij soyuz promyshlennikov i predprinimatelej Rossijskoe aktsionernoe obshchestvo Edinye energeticheskie sistemy Rostehnologii Rostov oblast Rostovskaya oblast Rotenberg, Arkadij Rotenberg brothers Rovenska oblast Rovno RSPP rules Russell, Bertrand Russian Academy of the National Economy and the State Services under the President of the Russian Federation Russian Academy of Sciences (RAN) Russian Federation Russian Joint-Stock Company Unified Energy Systems Russian Orthodox Church Russian Public Opinion Research Center Russian Union of Industrialists and Entrepreneurs Russkaya pravoslavnaya tserkov Samara samoupravstvo sanctions Saratov region Saratovskaya oblast savings Sberbank scale of raiding scam Schwarzenegger, Arnold Scotland searches secondary stock market securities security of property seizure of property self-financing Severnaya Kazna

213

shadow economy Shaimiev, Mintimer share buybacks shareholder rights Shokhin, Alexander short term speculations Shuvalov, Igor Shvartsman, Oleg Sibneft siphoning off SK SKP Sledstvennyj komitet Sledstvennyj komitet prokuratury Smith, Adam Smolenskaya oblast smuggling Sobyanin, Sergey social obligations socialism Socialist Bloc socialist property socially complex societies Sodom and Gomorrah Soros, George Sothebys Soviet people Soviet Union Soyuz pravykh sil Soyuz sotsialnoj spravedlivosti Rossii special police forces speculations Spravedlivaya Rossiya SPS St. Petersburg staged bankruptcies Stalin, Joseph standard share starting price state contracts State Duma state regulation State savings bank Steal the stolen! Stepashin, Sergei

stock exchange brokers stock exchanges stock holders stock market stock price reduction stock revaluation stock selling stock tenders stock value storm troopers storms strategic enterprises strategic joint-stock companies street level bureaucrats Strojgazmontazh submitted claims subprime mortgages subsidiary supplemental income supremacy of law Sverdlovsk region Sverdlovskaya oblast Svyazinvest Swedish furniture retailer Switzerland Synttech Company Tajikistan target targeted company targeted enterprises targeted firm Tatarstan, Republic of Tax Administration tax breaks tax evasion Tax Inspection tax shields taxation Telenor tender bids theft theft of confidential information theft of socialist property threat of violence

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threats of violence Timchenko, Gennady TNK-BP ToAZ tochechnaya zastroika TogliattiAzot Tomskaya oblast top management compensation trade unions traffic police transaction costs transactions transfer of property transfer of shares transfer of wealth transition economy Transneft transparency Transparency International, Russian Office of travel abroad Trotsky, Lev Troy trust Tuleyev, Aman Turkmenia Tverskaya oblast Tverskoj court Tyumen UK Ukraine Ulyanovsk Ulyanovskaya oblast Ulyanovskptitseprom unemployment Unified system of gas supply Union of Right Forces Union of the Social Justice of Russia Union of the Soviet Socialist Republics United Kingdom United Russia United States unlawful actions Uralkalij

URS US USPP USSR Uzbekistan value maximization VCIOM Vekselberg, Viktor velvet re-privatization vertical axis of authority victimology violations violence violent entrepreneurship violent storms and assaults Virgin Islands virtual reality Vladimirskaya oblast Vneshekonombank Vneshtorgbank Volga Volgograd Volgogradskaya oblast Volodin, Vyatcheslav Vologodskaya oblast voucher auctions voucher privatization vouchers Vserossijsky tsentr issledovanij obshchestvennogo mneniya Vyacheslav Datsik Vympelkom wage arrears War of the Worlds western businessmen western investors western literature Western Siberia white knights windfall tax Winter Palace workers collective workload per judge

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World Bank World Chess Federation World War II Yaminskaya, Alla Yavlinsky, Grigory Yekaterinburg Yeltsin era Yeltsin, Boris Young Communists League YUKOS Zahvat.ru ZhEK Zhirinovsky, Vladimir

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ACRONIMS and ABBREVIATIONS ChOP, chastnoe ohrannoe predpriyatie [private security firm] Duma, Lower Chamber of the Russian Parliament FGUP, Federalnoe gosudarstvennoe unitarnoe predpriyatie [Federal state unitary enterprise] FIDE, World Chess Federation FNS, Federalnaya nalogovaya sluzhba [Federal Tax Services] FSB, Federalnaya sluzhba bezopasnosti [Federal Security Services], former KGB FSSP, Federalnaya sluzhba sudebnyh pristavov [Federal Services of Court Bailiffs] Gosduma, State Duma, Lower Chamber of the Russian Parliament HEI, higher education institution IKEA, Swedish furniture retailer Komsomol, Kommunisticheskij soyuz molodezhi [Young Communists League] LDPR, Liberalno-demokraticheskaya partiya Rossii [Liberal Democratic Party of Russia] M&A, Mergers and acquisitions MP, Member of Parliament MVD, Ministerstvo vnutrennih del [Ministry of the Interior] NAK, Natsionalny antikorruptsionny komitet [National Anti-Corruption Committee] Narkomfin, Narodny komissariat finansov [Peoples Commissariat of Finance] NEP, Novaya ekonomicheskaya politika [New Economic Policy] NII, Nauchno-issledovatelsky institut [Research Institute] RAO EES, Rossijskoe aktsionernoe obshchestvo Edinye energeticheskie sistemy [Russian Joint-Stock Company Unified Energy Systems] RF, Rossijskaya Federatsiya [Russian Federation] RSPP, Rossijskij soyuz promyshlennikov i predprinimatelej [Russian Union of Industrialists and Entrepreneurs] Sberbank, State savings bank SK, Sledstvennyj komitet [Investigations Committee] SKP, Sledstvennyj komitet prokuratury [Lead Investigation Department] SPS, Soyuz pravykh sil [Union of Right Forces] ToAZ, TogliattiAzot USSR, Union of the Soviet Socialist Republics VCIOM, Vserossijsky tsentr issledovanij obshchestvennogo mneniya [Russian Public Opinion Research Center] YUKOS, YUganskneftegaz and KuibyshevOrgSintez ZhEK, zhilishchno-ekspluatatsionnaya kontora

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About the author Ararat L. Osipian is a PhD candidate in the Department of Leadership, Policy, and Organizations at Peabody College of Education at Vanderbilt. He holds a PhD in Political Economy from Kharkov National University (Ukraine) and an MA in Economics from Vanderbilt University, where he came as a fellow of The US Department of State. Dr. Osipian served as an Assistant Professor of Economics at Kharkov University of Construction and Architecture before he came to the US. His publications include four books, Raiderstvo: Corrupt Raiding and Hostile Takeovers (Ukraine, 2011), The Impact of Human Capital on Economic Growth: A Case Study in Post-Soviet Ukraine, 1989-2009 (New York: Palgrave Macmillan, 2009), Economic Growth: Education as a Factor of Production (Ukraine, 2007), and Economy of the Welfare State: Foundations and Creation under the Conditions of Market Transformation (Ukraine, 2001). His articles appeared in Demokratizatsiya: The Journal of Post-Soviet Democratization, Research in Comparative and International Education, European Education: Issues and Studies, Canadian and International Education Journal, Economics of Education Review, Prospects: Quarterly Review of Comparative Education, International Journal of Educational Development, Transition Studies Review, Journal of Eurasian Studies, Journal of Economic Issues, International Journal of Sociology and Social Policy, Brigham Young University Education and Law Journal, East European Politics and Societies, Global Crime, Soviet and Post-Soviet Review, Laboratorium: Russian Review of Social Research, FedUni Journal of Higher Education, European Dialog, Business-Inform, and Region. He is also a winner of several awards, including grants from Soros Foundation, Open Society Institute, Edmund Muskie/FSA, Yale, Vanderbilt, and Central European University. His research interests include corruption in higher education and inequalities in access to higher education in international perspective, corporate, property and land raiding, nexus of education and economic growth, modern welfare states and political economy of transition.