If you were worried about what Mechel means for Russian business, this was the last piece of news you wanted to hear: government officials are working hard to soothe fears of the company’s collapse, and promising that Mechel will not suffer the same fate as Yukos. Presidential aide Arkady Dvorkovich has said “We consider it a positive signal that the company has all these weeks been co-operating with the anti-monopoly services,” and that the Federal Anti-Monopoly Service will conduct its probe with the full compliance of the law.

With trading drying up faster than desert rain, it seems that the “Bad News Bears” isn’t just a awful American movie anymore.

A denial of an attack from the state is in my opinion the worst news you could hear, meaning that Mechel’s fate is sealed. For years I have been called crazy (and a variety of other colorful titles) for arguing that the methodological treatment given to Yukos and Mikhail Khodorkovsky by judicial and regulatory authorities had created a well-oiled mechanism for the exercise of arbitrary power in the business sector, one that would soon claim many new victims. With regard to the aggressive comments against Mechel, one editorial has pointed out “Fair or not, Yukos will always be the first name on everyone’s lips.”

Per the Yukos experience, we on the defense team came to regard the assurances from the state as veiled threats of opposite intentions. If you consult our White Paper on the case, we provide a long list of the instances in which government officials promised that nothing would happen to Yukos (see the PDF for the footnoted citations):

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