Oleg Deripaska. Picture: REUTERS/RUBEN SPRICH
Oleg Deripaska. Picture: REUTERS/RUBEN SPRICH

Washington — US President Donald Trump’s administration on Sunday lifted sanctions on aluminium giant Rusal and other Russian firms linked to oligarch Oleg Deripaska, defying a Democratic-led push in the US Congress to maintain the restrictions.

Earlier in January, 11 of Trump’s fellow Republicans in the US Senate joined Democrats in a failed effort to keep the sanctions on Rusal, its parent, En+ Group, and power firm JSC EuroSibEnergo. But that was not enough to overcome opposition from Trump and most of his fellow Republicans.

Advocates for keeping the sanctions had argued that Deripaska, an ally to Russian President Vladimir Putin, had too much control over the companies to lift sanctions. The sanctions were imposed in April 2018 to punish Russia for actions including its annexation of Ukraine’s Crimea, efforts to interfere in the US elections and support for Syria’s government in its civil war.

Some legislators from both parties also said it was inappropriate to ease the sanctions while special counsel Robert Mueller investigates whether Trump’s 2016 presidential campaign colluded with Moscow.

But in its statement on Sunday, the US treasury said the three companies had reduced Deripaska’s direct and indirect shareholding stake and severed his control.

That action, it said, ensured that most directors on the En+ and Rusal boards would be independent directors, including Americans and Europeans, who had no business, professional or family ties to Deripaska or any other person designated for sanctions by the US.

Rusal shares jump

“The companies have also agreed to unprecedented transparency for the treasury into their operations by undertaking extensive, ongoing auditing, certification, and reporting requirements,” the treasury’s statement said.

Deripaska himself remains subject to US sanctions.

After the treasury announcement, Rusal said Jean-Pierre Thomas had resigned as chair and director of the company as part of the deal to lift the US sanctions. Shares in Hong Kong-listed Rusal jumped more than 5% in early trade on Monday.

Trump administration officials, and many Republicans who opposed the effort to keep the sanctions in place, said they worried about the effect on the global aluminium industry. They also said Deripaska’s decision to lower his stakes in the companies showed that the sanctions had worked.

Rusal is the world’s largest aluminium producer outside China. The sanctions on the company spurred demand for Chinese metal. China’s aluminium exports jumped to a record high in 2018.

US elections scandal

Trump denies collusion, and Moscow has denied seeking to influence the US election on Trump’s behalf, despite US intelligence agencies’ finding that it did so.

Deripaska had ties with Paul Manafort, Trump’s former campaign manager. Manafort pleaded guilty in September 2018 to attempted witness tampering and conspiring against the US.