Trump Administration set to impose sanctions on the company of Putin Associate - TIME

(Bloomberg) – The Trump administration is ready to impose sanctions on the aluminum company of Russian billionaire Oleg Deripaska, United Co. Rusal, after having reached an agreement to significantly reduce his ownership interest.

Deripaska will remain under US sanctions and its ownership will remain blocked, but the Treasury intends to remove financial restrictions on Rusal, En + Group Plc and JSC EuroSibEnergo. The move will take effect within 30 days unless the Congress blocks the action, the Department of Finance said on Wednesday's statement.

"These companies are committed to significantly reducing Deripaska's ownership and breaking its control," said Finance Minister Steven Mnuchin in the statement. "Companies will be subject to continued compliance and will suffer serious consequences if they fail to comply."

Mnuchin added that Treasury "retains the assets under the terms of the agreement to have unprecedented levels of transparency in operations."

The Minister of Finance emphasized that Deripaska, not the companies, was the target of US sanctions imposed on Russian President Vladimir Putin's officials in April on Moscow's intervention in the 2016 US presidential election.

The announcement came on the same day that the Treasurer imposed new sanctions on 15 Russian military intelligence services during the US election campaign, as well as the attempted murder of a former double agent in the United Kingdom. A former intelligence officer was accused of working for Deripaska.

Rusal is one of the largest companies the US has ever placed on the sanction list. The value of the aluminum producer fell by more than half of $ 9.2 billion more than seven months ago.

Deripaska's agreement with Treasury includes reducing its direct and indirect shareholding below 50 percent in each company, overhauling the boards of En + and Rusal and "establishing full transparency with Treasury by executing comprehensive, ongoing auditing, certification and reporting requirements, "said department in a statement.

The oligarch's interest in EN + drops from about 70 percent to 44.95 percent, according to a letter from the ministry of finance to Senate Majority Leader Mitch McConnell. VTB Bank or another entity approved by the Ministry of Finance will become the owner of an equity block in EN + as collateral for previous liabilities that companies controlled by the billionaire will have to the bank. Deripaska will also donate a block of shares to a charitable organization, according to the letter.

Half of the EN +'s restructured council consists of American or British nationals and the current CEO of Rusal will resign according to the letter. Deripaska will also not be allowed to receive cash in exchange for shares that it declares or future dividends it receives from the companies.

Aluminum markets spun into chaos after the sanctions against the companies were announced, with global prices rising to 20 percent in the first week. Sanctions from the world's largest aluminum supplier outside of China threatened a global shortage of the metal, forcing Mnuchin to come back. Since April, he has been closely monitoring the issuance of the sanctions against Rusal when Treasury negotiated a deal with Deripaska to save the company from all financial constraints.

The Congress has 30 days to cast a vote to block Treasury's ability to lift the sanctions, according to the Countering America's Againsters Through Sanctions Act adopted by the legislators in August 2017.

Contact us at editors@time.com.

.