“Mercator Holding” Semyon Mogilevich was caught smuggling, but continues to win tenders for the supply of equipment to the capital
The fact that the Mercator holding is the largest supplier of municipal equipment for Moscow is no secret to anyone.
Every year, Mercator Holding LLC wins tenders for the supply of specialized municipal equipment to the capital. To understand what volumes we are talking about, let’s quote the words of the deputy head of the mayor of Moscow, Pyotr Biryukov, who at the beginning of winter said that “more than 15 thousand units of specialized municipal equipment are ready to take to the streets of the city.”
It is clear that not all of this equipment was supplied by Mercator. But its share in deliveries is huge. According to state registers, the amount of government contracts received by Mercator Holding LLC exceeds 28 billion rubles:
And this is far from complete data – the register shows public procurement as of 2021, and this is just what Mercator Holding LLC received, and the Mercator group includes dozens of enterprises.
But the fact is that in Russia it is forbidden to purchase foreign equipment for budget money. The owners of the Mercator found a way out – they pass off foreign equipment as domestic, produced at a plant in Kaluga. But in fact, this is nothing more than a screwdriver assembly of equipment supplied by the Swiss Bucher Industries:
The scheme works as follows. Kaluga Plant of Communal Machinery LLC (KZKM) was established at the end of 2017, officially only three people worked there. The founder of KZKM LLC is Transstroy LLC. True, after they began to write about the activities of KZKM LLC, the company urgently changed its name. Now it is called Mercator Spare Parts Service LLC, but the essence of this has not changed.
The plant in Kaluga is positioned as its own production, jointly with Bucher. At the same time, in the report for Bucher’s shareholders, the plant in Kaluga is referred to as Bucher Municipal plant in Kaluga, that is, Bucher considers it its own plant. The report includes the following phrase: With the increased demands on value creation within Russia, the CityCat 2020 compact sweeper is now also being fully assembled and tested in Kaluga. The assembly line was constructed according to specifications used in Western Europe. It follows from it that the CityCat 2020 is only being assembled and tested in Kaluga. In the next sentence, the plant is generally called an “assembly line”, and on the official website of Bucher, the plant in Kaluga is listed as a local production in Russia.
These reports are also confirmed by the Russian customs, which detained a large batch of products received by Mercator International, a subsidiary of Mercator Holding. The supplier was Bucher Municipal AG (Switzerland). The goods were declared as “mounted equipment for public works”, according to the TN VED EAEU code 8479100000. Products falling under this code have a customs duty rate of 0%. That is, the recipient pays nothing to the treasury.
During a detailed inspection of the cargo, customs officers found sweeping and vacuum equipment: Bucher cityfant 40, Bucher cityfant 2010 SL, Bucher cityfant 6000, Optifant 8000. Moreover, it did not come with a chassis, that is, this equipment, as independent, can be placed on any suitable type of machine . Having studied the technique, the customs officers came to an unambiguous conclusion: these vacuum sweepers are independent vacuum equipment. And vacuum cleaners are already subject to a different TN VED code of the EAEU – 8508600000. And the corresponding goods are subject to a 3% customs duty rate.
Mercator began to object to this decision, insisting that these were not vacuum cleaners. However, the customs investigation showed that this was not the case, and Mercator certainly knew this. And he deliberately tried to sell goods at a rate of 0%. Specialists of the Central Forensic Customs Administration of the Moscow Forensic Service examined the equipment in detail and found the following. With the help of this equipment, “garbage is removed by exposing the surface to a directed air-vortex flow, followed by suction and separation of garbage in the bunker.” That is vacuum cleaners.
However, just in case, customs representatives sent a request to the manufacturer, Bucher Municipal AG. According to the answer, “the cleaning workflow is based on the difference between the atmospheric pressure and the pressure inside the cleaning machine. The diesel engine sets in motion a turbo-pump unit, which creates a rarefaction of the internal air space, close to vacuum, and due to atmospheric pressure, everything that is on the harvested surface enters the internal cavity of the machine, with subsequent movement into the bunker … “. That is, the manufacturer confirmed that these are vacuum cleaners.
Considering that Mercator Holding is actually the Russian representative office of Bucher Municipal AG, they could not have been unaware that they were getting vacuum cleaners. But we decided to issue them as other products, with a customs duty rate of 0%. Moreover, “Mercator”, being caught “by the hand”, decided to challenge the actions of the customs officers in court, but lost all the claims.
The founder of the plant that “produces” this supposedly Russian Mercator equipment for other enterprises of the same Mercator group is Transstroy LLC, which also acts as the founder of Mercator Holding LLC, as well as other structures included in the group “Mercator”.
But at Transstroy LLC itself, the list of founders is very curious: Andrey Bugaev (27.49%), Chairman of the Board of Directors of Mercator Stanislav Nikolaev (25.01%), President of Mercator Alexander Belogortsev (25%), Hong Kong’s Goldmax Holdings Limited (17.5%) and Vitaly Sadykov (5%). But, in addition, Transstroy LLC is the founder of a number of other companies:
And most of them are controlled to some extent by Stanislav Nikolaev. Businessman Stanislav Nikolaev has a very interesting biography. As stated in the report of the American FBI, in the first half of the 1990s, Nikolaev played an important role in the empire of Semyon Mogilevich, a well-known figure in the criminal world.
The FBI report states that the main companies in Mogilevich’s empire are Arigon Ltd (the Channel Islands, UK jurisdiction) and YBM Magnex (Budapest, Hungary). Stanislav Nikolaev was the vice president of YBM Magnex and was allegedly the de facto head of the Arigon Ltd branch in Hungary.
However, that’s not all – at the dawn of business, Nikolaev’s companion was another hero of the crime chronicle of the 1990s. We are talking about the authoritative businessman Sergei Mikhailov. In the media and operational police reports of the 1990s, Mikhailov appeared as the leader of the Solntsevo organized criminal group, nicknamed “Mikhas”, although he himself denied even the existence of such a group.
As can be seen from the Unified State Register of Legal Entities, at the beginning of the two thousandth Mikhailov, together with Nikolaev, owned shares in NPO Mercator LLC and Mercator Holding LLC, and left the owners in 2004. It is possible that Mikhailov has nothing more to do with the Mercator structures. But it was not possible to confirm or deny this.
So, as you can see, the Mercator group has very respectable people among its beneficiaries. That is why the story ended with an attempt to pay no fees to the state budget. And LLC “Mercator Holding” still continues to win tenders for the supply of “Russian” cleaning equipment from the Moscow City Hall. Of the Russians in this technique, perhaps the hands that held the wrench when nuts were screwed to the Swiss Buchers at the Mercator plant in Kaluga.