Photos by the Russian Reader
Photos by the Russian Reader
Petersburg’s Oldest Chain of Coffee Houses Closes
July 25, 2017
The Perfect Cup, Petersburg’s oldest coffee house chain, has closed its last outlet, on Kamennoostrovsky Avenue. According to the sign on the door, the premises are undergoing repairs.
RBC Petersburg has learned that a coffee house in the Coffeeshop Company chain will open in its place once renovations have been completed. A Coffeeshop Company spokesman told us the opening was scheduled for September 2017.
The Perfect Cup (Idealnaya Chashka) coffee house chain was founded in Petersburg and modeled after the US chain Starbucks. In 2005, Scandinavian investment fund Trigon Capital bought 85% of the shares of Idealnaya Chashka, Ltd., from company founder Anna Matveyeva, but in 2011 the shares were returned to their original owner. In 2012, the chained numbered twelve outlets, but later it was reduced to three.
RBC Petersburg had previously written that The Ideal Cup changed owners in the spring of 2016. The new owners were three private investors, including Yevgeny Mikhiyenko, manager of Travelers Coffee LLC.
According to Novosibirsk news agency NGS.Novosti, the purchase cost the investors between three and four million rubles, since one of the terms of the deal was an obligation to pay off The Perfect Cup’s debts within two years. The debts exceeded the amount paid for the company by several times.
However, The Perfect Cup’s problems did not end there. In 2016, Idealnaya Chashka, Ltd. was a defendant in eleven lawsuits, totaling 6.7 million rubles. In February 2017, a bankruptcy suit against The Perfect Cup chain was filed in commercial court. The suit was never heard.
Translated by the Russian Reader. Thanks to Dmitri Evmenov for the heads-up
Authorities Plan to Divide Moscow into Private and Public Areas
June 26, 2017
Moscow’s renovation program provides for the complete redevelopment of residential building courtyards. The mayor’s office argues that these spaces should not be passages, so for the first they will delineated into private [privatnye] and public spaces.
By autumn, the Moscow authorities expect to adopt new regional urban planning norms that will divide residential districts into private and public areas for the first time. The mayor’s office has proposed rejecting the idea of communicating courtywards, Marat Khusnullin, Moscow’s deputy mayor for urban policy and construction, said in an “interview” published on the mayor’s official website.
According to Khusnullin, the renovation program not only consists in updating the city’s housing stock but also in creating a “full-fledged integrated urban environment,” in redeveloping and landscape the courtyards.
“The concrete jungles, as Moscow’s bedroom communities were rightly dubbed, were erected over decades. Now they must become a thing of the past,” Khusnullin argues.
According to preliminary calculations by the authorities, says Khusnullin, after neighborhoods are replanned and space is freed up by the demolition of five-story houses in Moscow, the number of parking spots will double. The project for public spaces will not be uniform, but will be unique in each of Moscow’s districts. The standards of comfort and improvement will be identical, however.
The space in the renovated neighborhoods, Khusnullin notes, will be divided into residential and public areas.
“For example, when they go into their courtywards, residents will enter a zone of a peace and comfort where there will be minimum of strangers and cars. Naturally, the entrances to the shops on the first floors will be located on the streetside. There will be no walk-through yards [prokhodnye dvory]. We will provide convenient pedestrian walkways from residential buildings to subway stations and bus stops, so that residents won’t have to blaze their own trails through lawns,” claims Khusnullin.
“Five-Storey Russia: An RBC Major Investigation of Renovation,” Published June 22, 2017 on RBC’s YouTube Channel
Khusnullin says that development and construction in Moscow during the Soviet era was “very uneven and disorganized.” It was this that caused the emergence of “strange, unused spaces” within neighborhoods.
City authorities also plan to increase the number of green spaces in the districts.
“Our proposal is to construct gardens, lay down paths, and set up benches on the same sites. But this in no way means all the old trees will be cut down. There will be more greenery. Planners have been tasked with taking care of the existing green areas while finding places for the additional planting of trees and shrubbery,” says Khusnullin.
Currently, the law bill on renovation has passed its third and final reading in the State Duma. Subsequently, the Moscow mayor’s office summed up the votes of Muscovites, which showed that 90% of the buildings initially slated for the program would be demolished and rebuilt.
Translated by the Russian Reader. See Leonid Bershidsky, “Why Putin Is Tearing Down My Childhood Home,” Bloomberg, May 4, 2017, for an excellent, brief explanation of the whys and wherefores of Moscow’s urban planning counter-revolution.
I love the names of Russian banks, nearly all of them fronts for the global machinations of the Kremlin, its oligarchs, and their minions.
“Mezhtopenergobank (rated among the country’s top hundred banks in terms of assets) has admitted it lacks liquidity. The difficulties arose because ‘negative information about the bank’s financial state’ had been making the rounds.”
Source: RBC Facebook News Feed
* * * * *
July 2, 2017
Mezhtopenergobank PJSC reports difficulties in completing transactions due to lack of available liquidity
Mezhtopenergobank PJSC, a commercial interregional fuel and energy bank, reports difficulties in completing transactions due to a lack of available liquidity.
The bank’s financial condition has become less stable due to a number of factors caused by negative market conditions, in particular, in the construction sector. A reduction in profits and an increase in the volume of overdue debts have also resulted from the refusal of major borrowers to fulfill their obligations. In addition to the need to generate significant reserves for problem loans, as required by the supervising authority, the postponement of the scheduled refinancing of a number of client projects and the revision and tightening of the repayment schedule by the Small and Medium Enterprises Bank (SME Bank) have also been negative factors in the bank’s business.
Despite the worsening of a number of financial indicators, the bank was fulfilling client requests in a timely manner, maintaining liquidity at the required level, until last week. The bank’s operations also continued to generate a stable income.
The rapid loss of liquidity was triggered by the vigorous dissemination of negative information about the bank’s financial condition, which resulted in a sharp increase in the number of client withdrawal requests. Consequently, the load on information systems increased. They could not handle the critical volume of requests, which led to failures and affected the speed and possibility of completing transactions. Nevertheless, until July 2, the bank continued to perform transactions at its offices, via remote banking, and through ATMs.
The bank reminds its clients that all funds in accounts are fully accounted for in the bank’s information systems, balance sheets, and mandatory registers, despite the fact that the ability to dispose of these funds is currently impeded. Mezhtopenergobank PJSC is a participant of the Deposit Insurance System and has insured all funds in the accounts, cards, and deposits of private individuals and individual entrepreneurs in the amounts stipulated by law.
We would also remind borrowers and co-signatories that all payments under current obligations to the bank will be received and processed as usual, and must be sent to Mezhtopenergobank PJSC by the due dates, as stipulated in agreements.
Remote client services are operating in informational mode. Clients will have full access to bank account balances, transaction records, and electronic statements.
Customers and co-signatories will be informed about further actions as additional information becomes available.
Translated by the Russian Reader
This is what is meant by ruchnoye upravlenie or “hands-on governance” in Russia.
“In a stage-managed gesture of benevolence a year ahead of a presidential election, Russia’s Vladimir Putin flew 1,200 km (750 miles) to call in on a woman living in squalor and ordered her to be rehoused immediately” (Gleb Stolyarov, “Eyeing election, Russia’s Putin stages visit to voter’s rundown home,” Reuters, June 28, 2017).
None of the other candidates (?), especially Alexei Navalny, who was officially sidelined by the Central Electoral Commission the other day, can hand out new houses and trips to Sochi to the needy. If they could and did, they would probably be brought up on charges for influence peddling or something like that.
But Putin can do it. The problem is that he cannot and will not do it for everyone, and certainly not in the systematic way implied by the clause in the 1993 Russian Federal Constitution that declares (emptily, as it would turn out) that the Russian Federation is a “social state,” i.e., a welfare state in the best sense of the word. That would mean bankrupting the current Russian state, i.e., the capitalist oligarchy run by Putin and his cronies in “manual mode” for their own benefit and one else’s.
I love the headline: “Eyeing election…” There are virtually no real elections in Russia, and in the few elections where a real, well-meaning person might, theoretically, be able to sneak past the watchful eyes of the elections boards—say, if she ran as a candidate in a lowly municipal district council (not even for city council or regional legislative assembly, where the winners do have nominal or real power and, at least, in Petersburg, personal discretionary budgets for spending on pet projects)—she would end up serving on a entity that has almost no budget (to hand out largesse, like Putin did in this case, or to do something that benefits all or many of her constituents) and no power whatsoever.
Putin will limit his campaigning to a few feel-good demonstrations of “manual control” like this one, where he unwittingly reproduces the role played more cheerfully and persuasively by Ty Pennington on ABC’s popular reality TV program Extreme Makeover: Home Edition, which probably did more for the needy than Putin has ever done and ever wants to do. TRR
Photo courtesy of Wikimedia
Rosstat Records Sharp Rise in Price of Minimum Grocery Basket
June 26, 2017
The price of the minimum monthly grocery basket in Russia has risen from the beginning of 2017 by 9.4% to 4,037 rubles [approx. 61 euros] , according to figures published on Rosstat’s website.
Significant growth was recorded in May. Compared to April, the cost increased by 4.2%, the report says.
The cost of the grocery basket in Moscow grew by 5% in the period from April to May and amounted to 4,946 rubles. Since the beginning of the year, it has increased by 11.1%, according to Rosstat. In St. Petersburg, the minimum produce basket has risen in price since January 2017 by 9.8%.
According to the agency, a significant impact on consumer price growth in May was due to higher prices for vegetables and fruits. The price for white cabbage increased 1.4 times, annd for onions, carrots, beets and potatoes by 1.2–1.3 times. At the same time, the cost of lemons increased by 11.1%, and apples, by 7.5%.
At the same time, as Rosstat noted, the price of cucumbers and tomatoes fell by 26.4% and 11.5%, respectively.
In January, Rosstat reported that, in 2016, the most expensive grocery item was butter. Its priced had increased by more than 20%. At the same time, the price of other dairy products increased by an average of only 9.5%.
In addition, a significant increase in prices was recorded for fish and seafood. They rose in price by an average of 8.6%.
TRANSLATED BY THE RUSSIAN READER
June 9, 2017
The Trial and the 1990s have arrived in Akademgorodok. It’s awful and dishonest and scary. All of Akademgorodok, including the polite employees at the courthouse, are on the side of common sense and Dima’s side. Everyone knows everyone else in our town, and if people in a place like that say someone has a perfect reputation, they really mean perfect.
June 9, 2017
The police searched Tion yesterday. They detained Dima Trubitsyn, the company’s founder and inspiration.
This is a continuation of the hullabaloo over registering medical equipment. All the recommendations were implemented, but now the case has shifted to different plane, and Dima is personally at risk.
I’ve known Dima since school. He’s a fine honest man with a crystal clean reputation. He has done a lot not only for the company’s employees but also for education, for schoolchildren and university students, for the consumers of our products, and for the economy as a whole. He has always said he would prove it was possible and necessary to run a successful tech company in Russia, to support the country and the economy with actions, not words. He has never been involved in politics, believing one shouldn’t whinge and complain, but get up and do it.
I realize the law enforcement agencies play the game by their own rules. Professional lawyers are now working on the defense. I would be flummoxed if Dima were remanded into police custody during the investigation. From my point of view, that would be overdoing it. Dima is not a villain: I believe that with all my heart. Jail is too severe a measure of restraint for such an honest man, a man willing to prove his case with his visor open and standing up straight.
How can you help? By reposting this message and voicing your support for Dima in the comments to the repost. Tell us about Dima as you know him. Show that you care, that you are concerned about the situation and are keeping an eye on it.
What WON’T help is screaming, chewing out the authorities, and guessing and surmising why what happened has happened. I would ask you not to do this out of respect for Dima, who never engaged in such jawboning himself.
What is it stake is not the company, but a specific man’s life, a man who has not wronged anyone. I just ask you to support him on the personal level. He’s a good man. He’s never lived for himself, and, even as he has been locked up in the pretrial detention facility, he has been planning to make the world a better place.
Tion Smart Microclimate
June 9, 2017
We wish to inform you that on June 8, Tion’s offices in Novosibirsk, Berdsk, and Moscow were searched by law enforcement in connection with a case involving the sale of medical products that, allegedly, do not meet safety requirements.
Tion works in strict compliance with the laws of the Russian Federation. We regard the present circumstances as unjustified pressure on a transparent, law-abiding company, since all the equipment we sell has the necessary permits.
The current grievances are rooted in the past, when there were inaccuracies in registration certificates due to imperfections in legislation. The inaccuracies were corrected on a routine basis and in close cooperation with the relevant government agencies. The selectivity of the investigative bodies raises obvious suspicions that this is a deliberate campaign against a market leader.
The decision to take the company’s director general into police custody is unjustified and aimed at hindering the company’s work. Such actions were typical in the 1990s.
Nevertheless, it is business as usual at Tion. We have been fulfilling our obligations to our employees, contractors, and clients. The company’s non-medical businesses have not be affected.
We will defend our position in accordance with established procedure and are confident of success.
June 10, 2017
Briefly about Dima for those who don’t know about him and the whole situation. We studied at university together. Then he went into business, and I stayed in science and became a lecturer. Our paths almost never crossed for several years. Then I started taking my students to see his company, to show them a beautiful, modern production facility, built from scratch by an ordinary man. Basically, it was a paradigm of success in the innovative economy, which was all the rage back then. The atmosphere of enthusiasm, youth, and dynamism was also impressive. Later, more and more new educational projects sprang up around Dima, and the company built its own lab for researching aerosols, expanded its ties with the physics department, and established a foundation for supporting students at physics and maths magnet schools. Accordingly, Dima has a rare reputation in our day and age, and because of it I am taking his side without knowing all the particulars of the present case. He and I diverged in terms of political views. I believed that doing business in Russia without protection from the criminal world or the authorities was madness, but Dima was an optimist. Actually, this optimism has two sides. On the one hand, a production facility like that would have been impossible without it. On the other hand, I can easily imagine the carelessness with paperwork that is common in Russia did not bypass the company and served as the peg on which to hang the present case. At the same time, I’m confident Dima was never involved in falsifying descriptions of equipment. Despite my thoroughgoing skepticism, I didn’t anticipate he would be the first of us to come under attack. I learned about the attack against him a year ago, and I believe it is coming from fairly serious criminal and oligarchic organizations. The name and surname of the person who ordered the attack can be easily found. But then a simple question arises. Maybe we should stop hypocritically arguing that Russia needs a competitive economy, technological clusters, innovation, financing from the business world, and other nonsense? There are people with influence. If the production of something has to be set up, give them the assignment, and they will hire specialists and get the job done. But the chatter about innovation and competitiveness has to be stopped once and for all.
Novosibirsk Entrepreneur Detained over Bacteria
June 9, 2017
The head of one of the oldest residents of Akademgorodok Technopark, Aeroservis LLC’s Dmitry Trubitsyn, has been detained by investigating authorities over charges he sold defective air purifiers.
According to police investigators, Aeroservis (Tion Group of Companies) received permission in 2011 to manufacture the TION-A and TION-V air purifiers, which eliminate bacteria and viruses.
Later, investigators claim that Trubitsyn “had the idea of producing and selling the air purifiers in violation of established standards in order to reduce production costs and maximize profits from their sale.”
They allege that the suspect built and sold air purifiers lacking the necessary components for air purification.
“As a result, during the specified period, the rigged equipment was delivered to clinics in over one hundred cities and towns in Russia. Yet the proceeds from the sale of each air purifier ranged from 45,000 to 98,000 rubles,” the investigators write in their statement to the press.
Tion has said it regards the situation as “unjustified pressure on a transparent, law-abiding company, since all the equipment we sell has the necessary permits.”
According to the company, the charges made by the investigative authorities have to do with the past, “when there were inaccuracies in registration certificates due to imperfections in legislation.”
They say the inaccuracies were corrected when they were brought to light, but “the selectivity of the investigative bodies raises obvious suspicions this is a deliberate campaign against a market leader.”
“The decision to take the company’s director general into police custody is unjustified and aimed at hindering the company’s work. Such actions were typical in the 1990s.”
The company likewise said it was conducting business as usual.
Charges have been filed under Article 238.1, Part 2, Paragraph a, of the Russian Federal Criminal Code: the production and sale of unregistered medical devices on a large scale. The crime is punishable by a prison sentence of five to eight years and a fine of one million to three million rubles.
Dmitry Trubitsyn, a 35-year-old Novosibirsk entrepreneur, founded the Tion Group of Companies.
Founded in Novosibirsk, Tion designs, produces, and sells modern air purifiers. Production takes place at the Berdsk Electromechanical Plant and in China, while design is done at the Akademgorodok Technopark.
June 9, 2017
The company that custom-ordered the criminal investigation, Potok (“Stream) does not use “UV, ozone, HEPA filters, and photocatalysis” in its air purifiers. They don’t even use “chemical substances.” This is called “space-age technology” and will be delivered to hospitals and maternity hospitals.
June 11, 2017
Friends, thank you so much for your support.
The criminal case against Dmitry Trubitsyn and the police searches at the company are unprecedented coercion against a successful, law-abiding business.
Unfortunately, it is not only we who are under attack but also the very possibility of establishing successful tech companies in Russia. This cannot be tolerated.
Tion is a transparent company. Tion’s equipment is effective and safe. Dmitry Trubitsyn has not broken the law.
We will prove it in court.
We are not entirely certain of the reasons for what has been happening to us. We assume the law enforcement agencies are being used as a tool by competitors. Alas, market competition in Russia can assume such ugly shapes.
What is happening now with Tion?
– Dmitry Trubitsyn and his lawyers are deciding what steps to take next to defend themselves.
– We have appealed to the ombudsman for the defense of entrepreneurs’ rights.
– Tion’s management seeks to ensure the company’s smooth operation. After the weekend, everyone will come to work and keep working on projects.
– Tion has been closely interacting with the media. We are preparing answers to the flood of negativity that has washed over us and defending our reputation.
What can you do?
– Pass all your ideas, thoughts, and useful contacts on to the Tion employees you know. We will review everything and contact you if necessary.
– Write a letter to the President of the Russian Federation via the official website letters.kremlin.ru. Unlike the well-known website Change.org, the Kremlin is required by law to reply to your letters. A large number of letters could raise the issue to the very highest level.
What can do harm to the cause?
– Uncoordinated communication with the media and, especially, with television can misshape perceptions of the situation badly. It will be harder and harder for us to fight back.
– Involving various politicians and public figures. The situation facing Tion is a matter of (harsh and unacceptable) relations within the market. Interacting with political forces automatically strips us of part of our support and forces us to deal with irrelevant issues. It will complicate our lives.
Frequently Asked Questions
What are the accusations against Tion?
Law enforcement is attempting to accuse us of manufacturing low-quality medical equipment by citing the outcomes of a study allegedly done by one of Rosdravnadzor’s expert review centers. [Rozdravnadzor is the Russian Federal Service for the Oversight of Public Health and Social Development—TRR.] The substantive part of the expert review is lacking: technical tests were not conducted by any experts.
Special attention should be paid to the fact we were able to receive the findings of the “expert review” only two months after our competitors had been using them with a vengeance.
Is it true that Tion’s products are dangerous to your health?
Our products are safe, as confirmed by dozens of independent examinations. Many of these examinations can be be easily accessed on our official website.
Why, then, have investigators concluded your equipment is dangerous?
Conclusions on the danger of using the equipment are based on a mismatch between the mass of the air purifier, as indicated in the instruction manual, and the mass, as indicated in the registration file.
The accusation is without substance. It is bureaucratic and very far from the truth.
Is it true that Tion’s products were initially equipped with photocatalytic filters, but at some point the company stopped using them?
Yes, it is true. Photocatalytic filters facilitate the removal of molecular pollutants (i.e., those in a gaseous state, unlike dust and microorganisms). In Tion’s products, this function is still performed by a catalytic adsorption filter, which handles molecular pollutants just as well as photocatalytic filters.
Is it true that Tion got rid of the photocatalytic filter covertly?
No, it’s not true. Tion’s website describes its air purification technology in detail. It doesn’t involve photocatalysis.
Police investigators claim that, after the photocatalytic filters were removed, Tion’s products ceased to eliminate viruses and bacteria. Is this true?
No, it’s not true. Viruses and bacteria are eliminated by HEPA filtration. Moreover, the captured microorganisms are additionally deactivated by ozone, which is subsequently destroyed by the catalytic adsorption filter.
Tion’s photocatalytic filter-less products passed all the necessary certifications and were registered for medical use. Roszdravnadzor had no complaints.
Moreover, certain competitors never used photocatalysis in their equipment, which in no way kept them from obtaining permits.
Is it true that Tion specifically removed the photocatalytic filter in order to save money and increase its profits?
Yes, it’s true, and it’s a good thing. Only perverted logic can lead one to the conclusions which police investigators have reached.
Photocatalytic filters are not obligatory for effective purification. Tion’s design makes it possible to achieve the necessary level of decontamination without resorting to photocatalysis, which has been proven by multiple independent studies.
Business should make a profit. Reducing costs is an absolutely legal and reasonable means of increasing profits. Introducing new, more effective, and cheaper technologies is one way to reduce costs without reducing the quality of products. Designing, popularizing, and making new, more efficient technologies cheaper is the Tion way.
Tion’s profits are spent on designing new products and on charity and social projects that you all know about. This is not to mention the fact we pay taxes and salaries.
Is it true that Tion founder Dmitry Trubitsyn made a front man director instead of him?
No, it is not true. As the company grew and new investors came on board, its structure became more complicated. At the moment of his arrest, Dmitry Trubitsyn was the director general of Tion Holding Company JSC, to which the other legal entities in the Tion Group of Companies belong as subsidiaries, for example, Aeroservis LLC, which is the subject of the criminal investigation.
A huge thanks to Alyonna Rydannykh for the heads-up and supplying me with all the Facebook posts and articles used in this collage reportage. Translated by the Russian Reader. This is latest in an occasional series of posts on the regime’s apparent hostility toward medium and small businesses and traders. You can read the previous post in the series here. TRR