EUROPE

Yukos takes shelter as government offensive continues

The Russian Government's legal campaign against the country's leading oil company has taken another dramatic turn with the arrest of the company's Kuibyshev refinery chairman for tax evasion.

Yukos takes shelter as government offensive continues

Rafail Zainullin was detained on charges of being instrumental in the refinery's failure to pay 67 million rubles ($US2.3 million) in taxes in 1999, during his tenure as a director before becoming chairman of the company's board.

Like the company's former CEO, Mikhail Khodorkovsky, the court ruled to keep Zainullin in pretrial detention for two months despite the relatively small sum of money involved. A similar case was launched in 2000 with Zainullin cleared of all charges.

Reports have now begun to circulate that the government is now chasing Yukos vice president Mikhail Brudno, the only one of the company's key shareholders not to be currently facing charges.

In response Yukos has filed a legal complaint against the Tax Ministry claiming its reputation had been damaged after the ministry leaked claims that the oil major failed to pay a total of 150 billion rubles ($US5.2 billion) in taxes.

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