By Emil DanielyanArmenia’s government has paid an Armenian-American lawyer close to Justice Minister David Harutiunian $266,700, a princely sum comparable to some of its social expenditures, for representing it in talks with foreign investors, officials said on Thursday.
Ara Saghatelian, the Justice Ministry spokesman, told RFE/RL that the payment, approved by the full cabinet on November 18, covers legal counselling provided by Vahe Yacoubian in the last 18 months. He said that Yacoubian has helped the government prepare laws and other legal documents and seal just about every deal involving major foreign companies.
Those include the Greek owner of the ArmenTel telecommunications monopoly, an Argentine company managing Yerevan’s Zvartnots airport and Russia’s Sibir airline that controls Armenia’s main carrier, Armavia.
Saghatelian confirmed that the U.S. attorney played a key role in the drawing up of a compromise agreement that ended long-running disputes between the Armenian government and ArmenTel’s parent company, OTE. He said Yacoubian also represented the government at the London-based International Court of Economic Arbitration which was considering a multimillion-dollar lawsuit filed by OTE.
The Greeks withdrew the suit this summer after the start of fresh negotiations with an Armenian government delegation led by Harutiunian. The resulting out-of-court settlement, which abolished ArmenTel’s monopoly on mobile telephony but upheld its grip on other telecom services, drew strong objections from at least two other ministers. It was also condemned as a sell-out by the Armenian opposition.
Yacoubian’s involvement in the government’s telecom dealings dates back to 1999 when he worked for a California-based law firm representing Yerevan in a tax dispute with both OTE and an offshore U.S. company that had previously owned 49 percent of ArmenTel. He has since developed a reputation of a figure close to Harutiunian. The latter has been central to virtually every takeover deal involving foreign companies struck in recent years.
Harutiunian’s spokesman insisted that this fact has had no bearing on the choice of Yacoubian as the government’s top commercial lawyer and the amount of pay. He said the hefty compensation was calculated on a per-hour basis, with Yacoubian invoicing the government for nearly 2,000 hours of work.
The payment is extremely lavish by Armenian standards. Interestingly, the government set extactly the same price for one of Armenia’s biggest hospitals controversially privatized in late September.
Public spending on some key social programs is not much higher. Last March, for example, the government allocated only 507 million drams ($1 million) to thousands of rural households hit hard by devastating floods.
Officials say Yacoubian, who is also one of the owners of a major hotel in downtown Yerevan, was hired because of his good knowledge of Western commercial law and business practices. “There are no lawyers of Yacoubian’s caliber in Armenia,” one government source told RFE/RL.
Local attorneys are certain to dispute the claim.
(Photolur photo: Yacoubian, right, advising Transport and Communications Minister Andranik Manukian during public hearings on ArmenTel in September 2003.)