BUSINESS IN BRIEF (11/29/98)

BUSINESS IN BRIEF

Embassies to emphasize commercial interests

KYIV - Foreign Affairs Minister Borys Tarasyuk said on November 16 that Ukraine's diplomatic missions are ready to represent the commercial interests of Ukrainian enterprises internationally. He added that in the future the effectiveness of Ukrainian embassies will be evaluated by increases in the balance of trade between Ukraine and the countries they represent. (Eastern Economist)

Boeing's Sea Launch dispute resolved

KYIV - The U.S. Department of State has resolved charges related to 207 civil violations of the Arms Export Control Act allegedly committed by the Boeing Corp. in connection with its Sea Launch commercial satellite launch program. Boeing and the Department of State signed a consent agreement on September 29 wherein Boeing was assessed a civil penalty of $10 million, of which $2.5 million will go to restructuring its compliance program for Sea Launch. Boeing will now be permitted to proceed with the Sea Launch program under a restructured technical assistance agreement and a new, stronger internal compliance program. A criminal investigation by the Department of Justice into Boeing's conduct in connection with the program will continue. The violations which have been the subject of this settlement pertain to Boeing and not to Boeing's foreign partners in the Sea Launch program. The partners are Norway's Kvaerner Maritime, Russia's RSC-Energia and Ukraine's Pivdenne Construction Bureau. (Eastern Economist)

Nestle Corp. buys into Lviv confectioner

LVIV - The Lviv-based confectionery company Svitoch on October 9 signed an investment agreement with industry leader Nestle. According to the agreement, Nestle will invest $40 million (U.S.) in the Ukrainian company; the majority of which will be paid out during the first year after signing the deal. Svitoch management has said that thanks to cooperation with Nestle, the confectionery company will be able to enter international markets, widen the domestic sales market and gain access to new technologies and cheap raw materials. Currently 2,252 shareholders own Svitoch's shares. Company employees own over 90 percent of the shares. The Svitoch management declined to say how the ownership fund is going to be redistributed after signing the deal with Nestle. (Eastern Economist)

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