The Estonian government is concerned about violation of human rights of the Estonia’s first-string investor in Ukraine

Arricano Real Estate plc, a leading developer and chain operator of European-level shopping & entertainment centers in Ukraine, informs that the Prime Minister of Estonia Taavi Rõivas has appealed to the Prime Minister of Ukraine Arseniy Yatsenyuk with a request to provide legal restitution of Arricano’s proprietary rights to SEC SkyMall. This issue was discussed at the meeting between Taavi Rõivas and the Ukrainian Prime Minister Arseniy Yatsenyuk during his working visit to Ukraine last week, on January 13-14, 2015.

As explained by the Extraordinary and Plenipotentiary Ambassador of the Republic of Estonia to Ukraine Sulev Kannike, the Estonian Prime Minister Taavi Rõivas at a meeting with his Ukrainian counterpart noted that the Estonian investors and businessmen believe in Ukraine and continue to see great potential in cooperation with it. And the support from Ukrainian state authorities becomes very important to them. At the same time the Estonian party is concerned about violation of Estonian investors’ rights in Ukraine, in particular, the rights of Arricano and Mr. Hillar Teder. Estonia intends to continue contributing to the protection of its businessmen interests in Ukraine.

“We are hopeful of the direct control of legal resolution to the matter on the part of the Ukrainian government. The good experience of each Western investor in Ukraine will become a positive signal on improvement of the investment climate and a guarantee of investments’ security in Ukraine not only for Estonian, but for all European businessmen”– stated the Ambassador of Estonia.

The appeal of Taavi Rõivas was preceded by official letters from Arricano to Taavi Rõivas as well as to the President of Estonia Toomas HendrikIlves with requests to help protect the rights of the company in Ukraine: in September 2014, SEC SkyMall was actually stolen from Arricano through a series of illegal registration activities involving Ukrainian government departments, in particular the State Registration Service of Ukraine (Ukrderzhreestr). In September-December 2014, Arricano numerously officially appealed to the senior officials of Ukraine, in particular to the President of Ukraine Petro Poroshenko and the Prime Minister of Ukraine Arseniy Yatsenyuk.

Arricano’s majority shareholder Mr. Hillar Teder is the largest Estonian investor in Ukraine. Since 200, Arricano invested over 400 million US dollars in the construction of six modern shopping centers in Ukraine. In the result of a series of raider attacks on SEC SkyMall made by Ukrainian partners A. Adamovskyi A. and A. Granovskyi in 2012-2014, the company has completely lost the access to operational and financial activity of SEC SkyMall.

The Estonian party has continuously appealed to Ukrainian officials requesting help to restore the rights of Arricano concerning SEC SkyMall. As part of this it is required to provide conditions for the resumption of corporate control of Assofit Holdings Limited over Prisma Beta LLC and the return of an SkyMall asset into the ownership of Prisma Beta LLC. It is necessary to provide an objective investigation by law enforcement agencies and the Ministry of Justice of the illegal actions taken by private notary Vegera L.O. in terms of the mortgage agreement; to block illegal actions of Ukrderzhreestr registrars concerning SEC SkyMall and corporate rights to Prisma Beta LLC; to provide law enforcement investigations of funds withdrawal from Prisma Beta LLC through fictitious companies and tax evasion in the amount of more than 400 million UAH.

History of the conflict:

In August 19, 2014 London Court of International Arbitration (LCIA) found in favor of Arricano and reinstated Arricano’s right to the option exercise under the terms of Agreement of 2010 for 51,4 million US dollars. Then, in September 2014 the project was actually stolen from Arricano – 100% of corporate rights to the object were transferred to third parties – Financing and Invest Solutions B.V., a Dutch company, and the ownership to the SEC was registered by Bank Pivdennyi alleged to be based on the outstanding debt in the amount of 32 million US dollars, which, in the opinion of Arricano’s management, was made artificially. These actions were carried out illegally – during the time when a number of judicial attachments were in effect. Despite Arricano’s and Ukrderzhreestr’s appeals to the prosecutor’s office, on December 17, 2014 the second illegal re-registration of the object was held – 100% of the corporate rights of the Ukrainian company – owner of Prisma Beta LLC project were illegally transferred from Financing and Invest Solutions B.V. to Sky Holding LLC (Borysil city).

The Director of Financing and Invest Solutions B.V. and Sky Holding LLC is S. Kolomiets – a business partner of A. Adamovskyi since the 90s in such companies as Farlep and Sedna S. At present, SEC SkyMall is owned by Bank Pivdennyi. The Bank has received the project in mortgage in 2013 under the agreement concluded with numerous major violations, and in 2014 the Bank registered ownership to the project with breaches – upon availability of valid injunctions.

Violations while transferring 100% of the corporate rights of Prisma Beta LLC were confirmed by the investigation of a competent responsible state agency, Ukrderzhreestr; following its results the agency appealed to the prosecutor’s office.