58 friends of Interpipe in Russia: the dark side of the “national” manufacturer

Russia’s invasion of Ukraine in February 2022 cannot be called the beginning of a war, because in fact the Russian-Ukrainian war began in 2014 with the occupation of certain regions of the Donetsk and Lugansk regions and Crimea. This is why the Russian invasion on February 24 is the beginning of a large-scale war.

Many Ukrainian politicians, oligarchs and business structures “changed their shoes” after February 2022: they changed their rhetoric from “it is necessary to negotiate” to “defeat the aggressor on the battlefield.” Public space remembers and records everything. One example of someone who earned billions with Russia and is now doing everything to make it forgotten is the Interpipe group of companies owned by Victor Pinchuk.

In 2005, an intergovernmental agreement “On regulating the supply of certain types of steel pipes originating from Ukraine to the customs territory of the Russian Federation” was concluded between the Ministry of Economic Development of the Russian Federation and the Ministry of Economy of Ukraine. Under this agreement, the products of Interpipe enterprises were exempt from additional import duties.

The list of plants that were given the green light included INTERPIPE NICO TUBE LLC, INTERPIPE NOVOMOSKOVSK PIPE PLANT OJSC and INTERPIPE NIZHNEDNEPROVSKY PIPE ROLLING PLANT OJSC. That is, the supply of pipes produced by Interpipe to the Russians was protected by a direct international agreement between Ukraine and Russia.

History of customs border crossing

Information about goods crossing borders is largely open. Many databases allow you to see who supplied products, how much and where. Such a database is maintained between Ukraine and Russia based on data from customs services. At the request of Interpipe, you can see how Interpipe, during the war since 2014, traded with Russia and strengthened its economy by supplying products and paying hundreds of millions of dollars to the Russian budget.

In 2016, The Wall Street Journal published an article by the owner of Interpipe entitled “Ukraine Must Make Painful Compromises for Peace With Russia” stating that Ukraine should cede occupied territories for the sake of peace in Russia .

It is interesting that on the day this article was published using customs databases, 12 trucks loaded with Interpipe pipes (225 tons) for Lesstroytorg LLC crossed the Ukrainian-Russian border. And this day was not special. And this happened almost every day. For example, on another day Interpipe sent 50 trucks worth 970 tons to Russia. The recipient of the cargo was the Russian division of Interpipe - Interpipe-M LLC, which has not yet been liquidated in Russia.

This fact gives an eloquent idea of ​​what goals the beneficiary of Interpipe wanted to achieve with his article. Most likely, according to the words about compromises with Russia, there was a desire to maintain business in this country.

You should pay attention to the declared customs value of the goods that Interpipe transported from Ukraine to Russia. According to declaration No. 110120001/413677, “cold-drawn seamless steel pipes of especially high precision” followed. Cost (TOTAL INVOICE VALUE (USD) for 20.5 tons is 657 US dollars. This is 32 US dollars per 1 ton. There is no such price on the market. The price of one ton of steel ranges from 700 US dollars per 1 ton. That is, instead of In order for Ukrainian companies to make a profit and pay taxes to the state budget, the customs value of goods was underestimated by 95%.

The situation with wheel sets for the railway is no less interesting. Let's take one of the deliveries, when 7 trucks with a load of 130 tons of wheel sets passed through the Ukrainian-Russian border (customs declaration No. 110120001/413742). The declared value of the goods was (attention) USD 2599.47. This is 371 US dollars for a 20-ton truck of wheel sets. The market value of one wheel pair weighing 1.15 tons is about 2,000 US dollars. The market value of a truck of wheelsets is about $35,000. And Interpipe declares 371 dollars. This is an undervaluation of almost a hundred times. That is, this is the money that the Interpipe company in Ukraine did not receive, and then through its Russian company Interpipe-M, registered in the elite Moscow City, sold this product at market value in Russia. And the money remained with Russia.

This delivery illustrates Interpipe’s business scheme for supplying goods to Russia: 1/10 of the cost remains in Ukraine, 9/10 in Russia.

Particularly cynical and symbolic is the fact that on the day when trucks with Interpipe goods for Russia crossed the Ukrainian-Russian border (September 30, 2016), Russian Foreign Minister Sergei Lavrov refused to apologize for the destruction of the Boeing.

After the publication of an article in the WSJ about the need for compromises with Putin on the rights of Interpipe in Russia, they are going up. The revenue of the Russian division of Interpipe is beginning to grow. From 4.9 billion rubles in 2015 it grows to 6.9 billion rubles in 2016 and reaches a peak of 10 billion rubles in 2017. And this is not surprising. After all, the scheme looks simple: Ukrainian Interpipe factories sell the products of their Russian company for pennies, and it is already engaged in sales on the Russian market and generates revenue.

And so - all the years throughout the Russian-Ukrainian war. All this data is available in tables and in the public domain. They have hundreds of Russian partners of Interpipe.

It is not surprising that, according to the Schemes investigation, in 2019 Pinchuk exported pipes and wheels worth 1 billion hryvnia to Russia.
Let’s just imagine the real market value of these goods and how much money Ukraine and the Ukrainian budget did not receive. Screen-7 “Schemes”

And to the main thing. As can be seen from the data of Ukrainian and Russian customs, Interpipe sold its products to Russia in two ways: directly to Russian companies at market prices or at reduced prices to its Russian daughter Interpipe-M, which carried out further sales to Russian clients.

From 2016 to 2019 alone, Interpipe supplied wheels worth $119.5 million and pipes worth $75.3 million to Russia at the declared customs value. As we have seen, in some cases the declared customs value was 95% lower than the market value.

From the open data of rusprofile we see that the revenue in the Russian market of Interpipe-M alone (without taking into account the revenue of the Ukrainian divisions of Interpipe, which sent goods directly across the customs border to other Russian enterprises) during the war years amounted to:

• 2015 – 80 million US dollars (4.9 billion rubles)
• 2016 – 103 million US dollars (6.9 billion rubles)
• 2017 – 172 million US dollars (10 billion rubles)
• 2018 – 147 million US dollars (9.2 billion rubles)
• This is half a billion US dollars in just four years.

Then revenue began to decline and over the next four years amounted to “only” 887 million rubles. But it is worth noting that even after the outbreak of a large-scale war, Interpipe continued to sell goods to Russia, pay taxes to the Russian budget and maintain its office in Russia, despite statements about the cessation of such activities. For 2022, Interpipe-M LLC provided financial statements. In 2022, after Russia’s invasion of Ukraine, the revenue of the Interpipe-M company from the sale of goods in the Russian Federation amounted to 131.66 million rubles. For 2022, Interpipe received almost 72 million rubles in net profit from Russia. Based on the results of 2022, Interpipe paid almost 36 million rubles in income tax to the budget of the Russian Federation.

The media even published statements of the movement of funds in Interpipe accounts in Russia, which clearly showed the maintenance of the office and employees in Moscow.

Is the decrease in Interpipe's revenue in Russia a sign of the cessation of activities in the aggressor country? No. The fact is that on November 7, 2022, Interpipe-M filed a lawsuit against another company of Pinchuk’s group of companies – Interpipe M.E FZE (UAE), which at one time was found to be supplying sanctioned goods to Iran. That is, in fact, the “left hand” (in Russia) sues the “right hand” (in the UAE) and tries to recover 2,957,434,042 (almost 3 billion) rubles through the court. Which at the time of filing the claim is about 50 million US dollars. Interpipe paid a court fee to the Russian budget in the amount of 200 thousand rubles for filing a claim against one of its companies against another.

The case is being considered by the court and the next hearing is scheduled for February 22, 2024.

Thus, having formally reduced revenue in Russia, Interpipe is still trying to bring in funds there in the amount of 50 million US dollars. Thus, Interpipe needs money in Russia. For what?

All this is happening against the backdrop of Interpipe’s statements that the West should strengthen its support for Ukraine in countering Russian armed aggression. It’s just not clear why Interpipe so wants to bring 50 million US dollars to Russia, and not to Ukraine?

And here it is worth mentioning that Interpipe used to feel so comfortable in Russia that intergovernmental agreements were literally signed for its factories to remove additional duties. And here's the question. Did you feel comfortable only before?

It’s curious, could any Ukrainian manufacturer receive guarantees of supply of their products to Russia at the level of the intergovernmental agreement of 2005? The Minister of Economy of Russia at that moment was German Gref. Today, Gref heads Sberbank of Russia and is among those responsible for smooth trade relations between Russia and other countries, and ensures the establishment of schemes and financial routes to reduce the negative consequences of sanctions.

In 2016, the beneficiary of Interpipe spoke in The Wall Street Journal about the need for territorial concessions to Russia. In 2023, Politico is already talking about the need to defend the territorial integrity of Ukraine. The rhetoric in Interpipe is changing. One thing remains unchanged: Interpipe still has business in Russia (Interpipe-M) and is still trying to bring in millions of dollars there.

From the customs database it can be established that Ukrainian Interpipe enterprises shipped their products to at least 58 Russian companies during the war. These are only those companies to which cargo was sent directly from Ukraine to Russia. Do not forget that this is only part of the trade turnover. The other part went to the Russian daughter Interpipe-M, which then resold pipes, wheelsets and other goods on the Russian market. All these companies to which Interpipe enterprises sold products paid and are paying taxes to the Russian budget, which financed and continues to finance the war against Ukraine.

The list of Interpipe partners in Russia during the Russian-Ukrainian war looks like this:

”JSC””AGROSNAB”””
JSC””ORZ””
”JSC””ZMK”””
JSC””Roslavlsky ORZ””
”Wagon repair depot Bataysk - a separate structural division of the joint-stock company””Wagon repair company – 1”””
“Wagon Repair Depot””Bryansk-Lgovsky”” is a separate structural division of the joint stock company “”Wagon Repair Company - 1””” “
Wagon Repair Depot””Gorky-Sortirovochny”” is a separate structural division of the joint stock company"”Wagon Repair Company company – 1”””
OJSC “Kolomensky Plant”
“JSC “Magnitogorsk Metallurgical Plant”””
OJSC “Oskolsnab” VKM
Kuloy
VChDr Volkhovstroy
“VChDr Goroblagodatskaya JSC” “VRK-3””
JSC ZHELEZNOGORSK CAR REPAIR PLANT RF 307170 ZHELEZNOGORSK KURSKAYA REGIONAL INDUSTRIAL SITE 2
“CJSC TsPTK” “ChMS””
“CJSC TsPTK””ChSM””
CJSC “LESSTROYTORG”
“””Murom plant TransPutMash”” LLC” “JSC
“BENZ”””
JSC “Lyudinovsky Diesel Locomotive Plant”
"LLC "ALNAS""
LLC "BSK""
LLC "VKM" Boiler" LLC VKM
SERVICE 431444 RF RM RUZAEVSKY DISTRICT RUZAEVKA STOL TOLSTOY, 7
LLC VLVRZ RF 182113 PSKOV REGION VELIKIE LUKI PR CT OKTYABRSKY D 117
LLC “VRP” “Novotrans””
LLC “Eletskaya Foreign Trade Company”” LLC
“Kashira Car Repair Plant” “Novotrans””
LLC “LEMAZ””
LLC “LOGISTICS 61 ”
”LLC “Lysvanneftemash”””
LLC PC “Promtube””
LLC PROMRESURS 346400 NOVOCHERKASSK STREET TRAM HOUSE 57A
LLC TEKHTRANS RF 618909 PERM TERRITORY LYSVA STREET REPINA 2
LLC UK DIRECT HALL 45403 6 RF CHELYABINSK STREET MATROSOVA (MAISSKY ) D 1 b
LLC Unitect 614047 Perm Territory, Perm St. Solikamskaya 317 Office 1
LLC “Interpipe-M”
PJSC Magnitogorsk Metallurgical Combine '
RVD
LLC Alariv Group ”
LLC Logistics
LLC” LLC ”“ Logino-Kemoles Workshop """
LLC "Industrial Park" "NPP""
LLC "SK "Toros"
LLC "Uralgazservice"
"Purchasing Center (CP) PJSC "KAMAZ"" JSC
"ARKHANGELSK TRAWLING FLEET"
JSC "GAMMA GYUCH SYSTEMLERY MUHENDISLIK
VE OOOKHHYUT ANONYM SHIRKETY CJSC International Paper CJSC
STROYRESURS
CASPIAN ENERGY PROJECTS
BENTELER DISTRIBUTION RUSSIA LLC
Vyra LLC
MIRATORG WEST LLC
STAUFF LLC
PJSC VYBORG SHIPBUILDING PLANT PJSC SEVERSTAL
REPRESENTATIVE
OFFICE OF THE COMPANY "SCHLUMBERGER LOGELCO" INK.”