Deputy Finance Minister: government may restructure Yukos debts

Russian Deputy Finance Minister Sergei Shatalov does not rule it out that the Russian government might decide to restructure Yukos debts.

"Theoretically, there is such a possibility. I do not rule it out, because the situation is unusual as a whole," Shatalov said to reporters.

"To this end, the government should adopt a relevant resolution. This is not a simple decision because it violates the rules of the game. This requires a political decision," said the Russian deputy minister.

"The line was drawn under restructuring long ago - two years ago," said Shatalov. Therefore, he continued, the decision to restructure Yukos debts would come as a violation of the principles of two years ago."

"This would mean forgetting that decision for the sake of Yukos," Shatalov added.

According to the deputy finance minister, he does not know whether Yukos and the government were in negotiations over the debt restructuring. "I know for sure that nobody is negotiating with me," he said.

He also did not exclude the possibility that Yukos might be allowed to pay taxes by instalments. In theory, it is possible because the tax law provides for payment by instalments in case of looming bankruptcy, delays of payments or tax loans," said the deputy minister.

He continued that delays are provided by the financial bodies, recipients of taxes. "According to the law which has just been signed by the president, this will be the competence of the federal tax service," Shatalov said.

The new system will take effect this August, he recalled.

Yukos is to file a request for a delay or debt restructuring. No request has been received so far.

Shatalov also told reporters that additional taxes, fees and fines to be paid by Yukos were not included into the draft federal budget for 2005.

"The budget is based on macroeconomic indices. Such cases (as Yukos) are classified as extra revenues, they are not considered or included in the budget," said the deputy minister.

"If this money is paid, it will be distributed in strict accordance with the budget and tax laws," said Shatalov.

Sergei Shatalov's statement on the possible Yukos debt restructuring caused Yukos shares to rocket at stock exchanges.

At MICEX, Yukos shares went up by 23%, and at the Russian trading system - by 16% in the wake of this statement.