Seizure of Assets in France

Spokesman Constantin Petrichenko told Russia regarded last week's seizure as a violation of the Vienna Convention governing diplomatic status and relations. A Paris high court ordered the seizure of all Russian state bank accounts in France at the request of Swiss-based trading company Noga which is seeking $63 million in debts from Moscow authorities over oil-for-foodstuffs deals in 1991 and 1992. Legal sources said Russia's lawyers could ask a magistrate to cancel, suspend or delay the court order. The seizure particularly affected a subsidiary of the Russian central bank in Paris, Eurobank. The court said it was a "holding measure" and it was up to Russia to challenge its validity. Similar procedures are under way in other countries including the United States and Luxembourg. Russian Central Bank Chairman Viktor Gerashchenko said on Monday that a Swedish court had frozen foreign-held assets of his bank and other Russian organisations in a dispute to settle claims against the government. He told a Moscow news conference that the ruling did not affect the bank's foreign currency and gold reserves and that Eurobank would mount a legal challenge to the ruling. The defence would show the central bank was not responsible for government obligations, Gerashchenko said. Gerashchenko did not specifically refer to Noga regarding the freeze, but said the bank had been forced to defend itself previously against the firm. Noga claimed about $279 million from Russia in a Luxembourg court in 1993, alleging Russian agencies broke contracts to deliver fuel in return for loans.