U.S. Business Group Warns Russia on Impact of Investor Jailing

(Bloomberg) -- The head of a major U.S. business group told Russia’s foreign minister that the jailing of a prominent American fund manager last month has cast a pall on the investment climate.

The case of Michael Calvey, the founder of Baring Vostok Capital Partners, is likely to overshadow U.S. participation at the June St. Petersburg International Economic Forum, the Kremlin’s annual investor showcase, Alexis Rodzianko, the president of the American Chamber of Commerce in Russia or AmCham, told reporters after a meeting with Foreign Minister Sergei Lavrov.

At the start of the meeting Tuesday, Lavrov said Russia was hoping for “active participation” at the forum from U.S. business.

Unlike last year, U.S. Ambassador Jon Huntsman isn’t encouraging U.S. business to attend the forum, Rodzianko said. “As long as the question of Baring Vostok isn’t resolved,” Huntsman won’t encourage participation actively, Rodzianko said. “This can influence the level of representation but not the numbers of people who attend.”

AmCham discussed Calvey’s case with Lavrov, Rodzianko said, noting that officials have publicly endorsed the position that business disputes should be heard in civil, not criminal courts.

“It seems that we have the same view on this issue with most of the Russian government and even with the president,” he said.

Public assurances on that issue from Russian officials including President Vladimir Putin haven’t led to any changes in Calvey’s situation, however. He denies the accusations of fraud, saying the case is the result of a conflict with other shareholders at a bank his fund owns a stake in. The Kremlin’s business ombudsman has backed that position, calling the jailing “illegal.”

But a Moscow court late last month ordered Calvey and several colleagues to remain in pre-trial detention until at least mid-April.

To contact the reporters on this story: Henry Meyer in Moscow at hmeyer4@bloomberg.net;Stepan Kravchenko in Moscow at skravchenko@bloomberg.net

To contact the editors responsible for this story: Gregory L. White at gwhite64@bloomberg.net, Tony Halpin

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