The government allowed state-owned companies not to disclose secrets


The Secrets Of “Rosneft”

Be in possession of the letter from the Deputy Minister of economic development Nikolai Podguzov, sent on April 15 in “Rosneft”. It is dedicated to making government companies annual reports on their activities.

Podguzov letter — response to an appeal to the Ministry of the Vice-President of “Rosneft” Larisa Kalanda. As reported by “Vedomosti”, the Calanda in late February, asked the Ministry to exclude from the required list for publication in the annual report information, trade secrets, and to establish uniform requirements for annual reports of public and private companies. According to the top Manager of Rosneft, increased reporting requirements of state-owned companies put them in unequal conditions with other market participants.

The duty of joint stock companies (JSC) to prepare for the meeting of shareholders the annual report prescribed in the JSC law. Requirements to the content of the report established by the Central Bank. For example, the controller asks to open the company’s position in the industry, priority activities, information about major transactions and related party transactions. From public companies, the Central Bank further requires to describe in detail the corporate structure and the quality of corporate governance in JSC.

Annual reports of state-owned companies demands more than the usual AO. In 2010, occupying then the post of Prime Minister Vladimir Putin approved by decree of the government an approximate structure of the annual report for companies with state participation. For example, the government is encouraged to disclose key performance indicators management information on the implementation of the investment program and the sale of non-core assets.

It is an additional requirement of the government caused dissatisfaction with Myself. In the letter Podguzova she reported that “Rosneft” does not want to disclose the purpose of their long-term programme of development and data about the alienation of non-core assets with the indication of deviations of the actual value of the assets sold from the balance sheet. The company also does not want to disclose the cost of investment projects and data on investments with yields over 10% per year.

In the annual report of Rosneft for 2014 (for 2015 year of the report yet) disclosed information about the sale of non-core assets, but the long-term program is described without details.

Even more secrets

Podguzov reminds the Camera that disclosure is the most important tool of interaction with shareholders and counterparties. According to the Deputy Minister, the report should contain information that allows to estimate results of activity of state company for a year, however, the necessary balance between the interests of the shareholder and the company itself. Some information may constitute a trade secret and reduce the competitiveness of state-owned companies. Conclusion made by the Deputy Minister: state-owned company has to decide what information to disclose in the annual report. The decision about the degree of confidentiality shall be based on the principles of reasonableness and good faith and be accepted by the Board of Directors on the proposal of the head of state-owned companies. Letter Podguzov, and Rosneft, affecting the activities of not only “Rosneft” and other companies — now they theoretically can refuse the publication of some data.

The representative of the Ministry of economic development Elena laskina confirmed the authenticity of the letter and the fact of his sending in “Rosneft”. The press service of Rosneft has not commented on the questions in fact.

Press-service of Central Bank reported that the content of annual reports of state-owned companies is the responsibility of the government, but they should also comply with the General requirements of the legislation and the Central Bank annual reports of joint stock companies. If the Issuer does not publish information the disclosure of which is compulsory, he should explain in the same document the reasons for the decision. The Central Bank recalled that the lack of information to be disclosed, is the reason for holding the Issuer liable, and for restrictions on the circulation of its securities.

Doubt lawyers

The interviewed representatives of state-owned companies such as “Gazprom”, “Bashneft”, FGC UES and Russian grids, has not responded to the request, they use company right to hide any information and that they will not publish.

Interviewed experts do not see serious problems in the ability of state-owned companies independently determine what constitutes a trade secret. According to the Executive Director of the National Association of corporate Directors Michael Kuznetsova, it is not critical if the company will not publish the information, provided that the content of its annual report will correspond to the Russian legislation, the requirements of the regulator, the listing rules and the recommendations of the national corporate governance code.

This right of state-owned companies, but only if we are talking about additional information that does not reveal the competitors agree, the Director for corporate governance Prosperity Capital Management Denis Spirin. According to him, investors should carefully read the annual reports of public companies and analyze the information from them, which supplements the financial statements.

Lawyer Alexey Melnikov believes that the letter of the Deputy Minister for the release of state-owned companies from publishing pieces of information is not enough. “This does not correspond to interpret the rules and may be challenged in court,” he said. According to Melnikov, the desired amendments to Federal legislation or government regulation.

Confidential information has certain criteria, and not the fact that the Board of Directors has the authority by their interpretation, says the partner of King & Spalding Ilya Rachkov. “I would place the Director abstained from voting on this issue so that not to bear responsibility, including financial, if the court finds an unlawful assignment of some fact to a trade secret,” — said the lawyer.