On January 23, 2023, the investigating judge of the HACC, Oleh Fedorov, refused to grant the motion of the NABU detective to apply an interim measure in the form of detention to Andriy Kobolyev, while simultaneously assigning him a bail in the amount of more than UAH 365 million.
Andriy Kobolyev, ex-manager of NJSC Naftogaz, is suspected of committing a crime under Article 191, part 5 of the Criminal Code of Ukraine: misappropriation of property on an especially large scale, abusing the official position. According to the investigation, in 2018, Andriy Kobolyev, as Chair of the Board of Naftogaz, appointed himself a bonus of UAH 229 million for winning the arbitration against the Russian Gazprom.
Let’s find out what was the court guided by in making a decision on the complete refusal to grant the detective’s motion.
The position of the court
1. Concerning the groundlessness of the charges served.
1.1. The suspect is not the subject of the crime under Art. 191 of the Criminal Code of Ukraine.
The investigating judge notes that the subject of the crime under Art. 191 of the Criminal Code of Ukraine is not any official in the sense of Art. 18, part 3 of the Criminal Code of Ukraine, but only one who has certain powers regarding the property, the seizure of which is incriminated to them. The following legal position is reflected in the decision of the Supreme Court in case No. 0912/1638/12 dated August 23, 2018:
Thus, the incriminated to the suspect misappropriation of someone else’s property occurs when an official illegally turns someone else’s property to their own advantage, while using their official position. The peculiarity of this form of the objective party is that the subject can seize the property in respect of which, by virtue of their position, they are endowed with the authority to manage or dispose of through other persons. That is, they have certain powers to influence the persons to whom this property is entrusted or is in their charge.
At the same time, in the situation of the suspect, the establishment of the amount of remuneration to the members of the Board of NJSC Naftogaz of Ukraine, including the Chair of the Board, belongs to the exclusive powers of the Supervisory Board of this Company — a collegial body. Still, there is no legislative provision that would give the Chair of the Board of NJSC Naftogaz power over the members of the Supervisory Board. That is, Andriy Kobolyev could in no way influence the determination of the size of the bonus for himself. Therefore, the suspect did not dispose of the funds that were paid to him as a bonus for winning in the Stockholm arbitration, so, he could not seize them, abusing his official position. Therefore, he is not a special subject of the crime under Art. 191 of the Criminal Code of Ukraine.
Separately, the court emphasizes that the prosecution does not even point to the potential complicity in the crime of any subjects directly authorized to make a decision on the rewarding the Chair of the Board. Therefore, the latter cannot be its sole executor.
1.2. Failure by the prosecutor to prove the fact of abuse of office by suspect Andriy Kobolyev when initiating the issue of paying a bonus for winning in the Stockholm arbitration.
At the court hearing, the prosecutor claimed that Kobolyev concealed information about the existence of restrictions on the amount of bonuses provided for by the Resolution of the Cabinet of Ministers of Ukraine No.859. This led to the Supervisory Board’s decision to award Kobolyev a bonus in an amount exceeding the limit of the CMU Resolution No.859. This allegedly reflected abuse of his official position.
The court considers such arguments unfounded. Neither any provisions of the legislation nor any constituent documents of NJSC Naftogaz of Ukraine provide for the powers or duties of the Chair of the Board to inform the members of the Supervisory Board about the presence or absence of regulatory restrictions on the amount of bonuses to the members of the Board and to provide legal advice on the specifics of the application of domestic legislation on the relevant issue.
At the meeting, the prosecutor stated that abuse of office, in her opinion, was the initiation by Kobolyev of the issue of awarding members of the board through an appeal to the Supervisory Board with a submission indicating the amount of the bonus, which exceeded the restrictions provided for by the CMU Resolution No. 859. In the opinion of the prosecutor, Kobolyev did not have the right to appeal to the Supervisory Board with a submission on the determination of bonuses in this amount.
However, the court found that there are no regulatory restrictions on the ability of the Chair of the Board to independently initiate the issue of bonuses for members of the Board before the Supervisory Board. Similarly, the prosecutor did not prove the existence of any legislative provisions that would determine the maximum amount of bonuses, the payment of which the Chair of the Board may initiate before the Supervisory Board. Instead, the CMU Resolution No.859, to which the prosecutor refers, regulates regulatory restrictions on the procedure for establishing bonuses by authorized subjects, and not the procedure for its initiation by other persons. That is, this CMU Resolution did not apply to the actions of the suspect Kobolyev because he did not make a decision to award members of the Board of NJSC Naftogaz — this was done by the Supervisory Board.
The prosecutor also argued about the impossibility of making payments to the Chair of the Board in the absence of an approved financial plan.
The court notes that similar regulatory restrictions do not apply to the procedure for initiating the payment of bonuses. Moreover, they were absent both in the Collective Agreement concluded between the Cabinet of Ministers of Ukraine and the trade union of NJSC Naftogaz, which, in particular, determines the size of the salary and bonus of the enterprise head, and in the Resolution of the Cabinet of Ministers of Ukraine No.859 at the time of the decision of the Supervisory Board on bonuses.
Thus, the prosecution did not prove that there was abuse of office in Kobolyev’s actions. And this is the objective side of the crime under Art. 191 of the Criminal Code of Ukraine.
1.3. The groundlessness of the allegations regarding Kobolyev’s misleading members of the Supervisory Board of Naftogaz when initiating the issue of bonuses.
According to clause 18, subclauses 5, 6 of the Regulation on the Supervisory Board of NJSC Naftogaz of Ukraine, members of the Supervisory Board are obliged to act in good faith, reasonably, not to exceed their powers, to exercise integrity, prudence and due diligence, as well as to be guided in their activities by the legislation of Ukraine. These provisions make members of the Supervisory Board personally responsible for their activities and decisions, and this responsibility exists independently of the actions and decisions of other bodies of the Company.
The respective responsibilities of the members of the Supervisory Board cannot be invalidated by the lack of information on regulatory restrictions on the part of the Chair of the Board, as the prosecutor claims.
In addition, the prosecutor did not explain how her allegations of deception of members of the Supervisory Board by the suspect correlated with the fact that the Nomination and Remuneration Committee had previously provided recommendations to the Supervisory Board on determining the appropriate amount of bonuses for board members.
Moreover, the court considers the prosecutor’s statement manipulative that most members of the Supervisory Board are foreigners, and therefore do not have sufficient knowledge of the features of Ukrainian legislation, which allegedly imposed on Kobolyev additional obligations to inform them about these features. Such statements of the prosecutor not only contradict the idea of corporate governance in joint-stock companies and discredit the role of international experts in the supervisory and control bodies, but also do not correspond to the circumstances of this case, which were mentioned above. In particular, Andriy Kobolyev had no obligation to explain to foreign members of the Supervisory Board the provisions of Ukrainian legislation. In addition, the court agrees with the arguments of the defense that such an explanation was not required because the members of the Supervisory Board are sufficiently competent.
Besides, a representative of the law firm Andreko Kinstellar Ugyvedi Iroda took part in the meetings of the Supervisory Board and the Nomination and Remuneration Committee, which resolved the issue of the size of the bonus for board members. She was specifically engaged as an independent legal advisor to provide legal assistance on legal issues arising in the activities of the Supervisory Board and its committees. That is, it was the duties of this specialist to explain the provisions of Ukrainian legislation to foreign members of the Supervisory Board.
The court also considered the open letter of the members of the Supervisory Board to the Prime Minister of Ukraine, in which they explained the relevant award decision, indicating that it was made on the recommendation of the Nomination and Remuneration Committee based on a thorough analysis of such court victories. The court considered an open letter from a post on LinkedIn by Ms. Clare Spottiswoode, who was the Chair of the Supervisory Board of Naftogaz in 2018, signed by all members of the Supervisory Board. In it, the members of the Supervisory Board emphasized the full awareness of the decision, indicating that they assumed full responsibility for it and did not experience any pressure from Kobolyev.
The court also points out that in the five years of the pre-trial investigation, members of the Supervisory Board who were allegedly pressured and misled, although these facts are refuted in open appeals, were never questioned.
At the same time, the fact of misleading members of the Supervisory Board by Kobolyev is not confirmed by any other materials attached by the prosecution.
Thus, the arguments of the prosecutor about the Supervisory Board’s decision on the amount of the bonus as a result of Andriy Kobolyev’s deception are untenable.
1.4. The lack of a cause-and-effect relationship between the actions of Kobolyev and the disposal of funds from the property of NJSC Naftogaz in the amount of USD 10 million.
The court notes that the process of deciding on the payment of the bonus to the Chair of the Board is multi-stage and involves the participation of several independent entities. Thus, Kobolyev’s actions on applying to the Supervisory Board are only the initial and undefined stage of such a process. In addition, neither from the materials attached by the prosecution, nor from the explanations of the prosecutor, is it impossible to establish whether Kobolyev independently determined the bonus of USD 10 million, which is indicated in the Amendments and Additions to the Submission.
The prosecutor did not deny that the initial version of the submission, signed by the suspect, contained omissions in places for determining the amount of the bonus, and did not in any way refute the chronology of events cited by the defense, according to which the final amount of the bonus that Kobolyev had to submit was determined at the closed part of the meeting of the Supervisory Board on April 17, 2018, by its members.
In general, the court notes that the materials collected so far, attached to confirm the validity of the suspicion, not only do not link Kobolyev with the crime incriminated to him (considering the above conclusions of the investigating judge regarding the absence of mandatory elements of the crime in his actions), but also do not convince the investigating judge that such a crime took place in the circumstances set out in the motion. The facts adduced by the prosecution are not sufficient to justify further investigation on such suspicion or indictment, which would meet the requirements of this standard.
Thus, the court concludes that the suspicion is unjustified, and this makes it impossible to apply any interim measure to Kobolyev.
2. Concerning the validity of the risks provided for in Art. 177 of the CPC of Ukraine.
The court notes that the risks of obstruction to criminal proceedings alleged by the prosecution are predominantly based on the gravity and nature of the alleged crime and the severity of the punishment for it. However, such risks are extremely low, given the absence of reasonable suspicion and the lack of evidence for the further criminal prosecution of Andriy Kobolyev.
In addition, despite the lack of strong social ties on the territory of Ukraine, the risk of hiding the suspect from the pre-trial investigation authorities and the court is completely invalidated by the independent and voluntary decision of the suspect to return from abroad immediately after receiving information about the pre-trial investigation.
This, together with his proper procedural behavior, indicates the suspect’s intention to assist the investigation, and not to evade it.