CSSF slaps fine on Gazprom's Luxembourg financing vehicle
Luxembourg's finance watchdog slapped a fine of €10,000 on the financing company of Russian energy giant Gazprom, which separately warned it might face bankruptcy because of sanctions the West has imposed against Russia.
"The administrative fine amounts to €10,000", the CSSF regulator said in a press release this week, as Gaz Capital S.A., based in Luxembourg, had missed a deadline to file its annual accounts over 2021.
The unit published its annual account on 27 July, business register filings show, more than three months after the deadline at the end of March.
"The company mainly engages in the issuance of loan participation notes with the purpose of financing loans to Public Joint Stock Company Gazprom", the filings show. The company posted profits nor losses in 2021 and 2020.
In its annual accounts, Gaz Capital refers to Russia's war against Ukraine as a "conflict" and refers to the country as "the Ukraine", a description Ukrainians say reduces the sovereign nation to a province of Russia.
"The directors believe the current ongoing conflict in the Ukraine create a material uncertainty in relation to the company's ability to continue as a going concern over the next 12 months", the accounts said. In accounting, a company being a "going concern" means it can stay afloat and avoid bankruptcy.
Auditors at PwC, who approved of the accounts, agreed there was material uncertainty whether Gaz Capital's could continue to exist.
The US sanctioned Gazprom immediately after Russia invaded Ukraine in February, including Luxembourg subsidiary Gazprombank. The EU so far has refrained from sanctioning Gazprom, though some EU countries are arguing that it should be included in the next round of sanctions.
The Luxembourg Stock Exchange suspended the trading of some of Gaz Capital's loan participation notes due to sanctions. The Euronext exchange also suspended securities as of June this year, Gaz Capital's annual accounts say.
Gaz Capital has been gradually replacing eurobonds with Russian bonds, according to a report published by Russian news agency Interfax.
Gazprombank, also supervised by the CSSF, failed to publish its annual accounts timely for several years, showing the ineffectiveness of Luxembourg's business transparency laws, a top government minister conceded in May.
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