SOURCE: The St. Petersburg Times
DATE: Issue #624 (0), Tuesday, November 28, 2000
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TITLE: Putin Stealing a March on U.S.
AUTHOR: By Ron Popeski
PUBLISHER: Reuters
TEXT: MOSCOW - President Vladimir Putin has steered clear of comment on the contested U.S. presidential election, but has put the weeks of turmoil to good advantage with a barrage of policy initiatives.


"If a confusing transition is bad for the United States, it's logical for Russia to take advantage of it," said one Western diplomat. "This has allowed Putin to be seen center-stage with what might be seen as relatively good and novel ideas."

Putin's press service and the Foreign Ministry politely declined on Monday to comment on the proclamation by George W. Bush that he won the Nov. 7 poll.

As in other countries, Kremlin officials had been too quick to offer congratulations on the day following the poll when it initially appeared Vice-President Al Gore had conceded defeat.

But Putin, who has made foreign policy a priority, has not hesitated to make good use of America's embarrassment.

"Since Putin has been in charge, the centerpiece of all his initiatives has been opposition to a mono-polar world," said the Western diplomat.

Some of these initiatives, pressed during the weeks since the U.S. vote, were long-standing ideas freshly repackaged.

Putin repeated his offer to slash strategic nuclear arsenals to 1,500 warheads each for the United States and Russia - an easier number for cash-strapped Moscow to maintain.

He called for quick ratification by signatories of a revised agreement on Conventional Forces in Europe - altered to take account of Russian troops redeployed in southern regions in the campaign to crush Chechen separatists.

A top official said Moscow might soften opposition to U.S. proposals to alter the 1972 Anti-Ballistic missile treaty in order to proceed with a national anti-missile defense system. 

Putin renewed Russia's resistance to the proposals, but was shown, alongside British Prime Minister Tony Blair, appearing utterly reasonable in offering to discuss them.

"The arms initiatives were typical Russian foreign policy moves independent of the election, moves used even way back in Khrushchev's time," said Leonid Velikhov, an observer for Itogi magazine. "This was always a means to send the ball into the other man's court."

Putin looked equally reasonable in saying he understood the motivation for a European Union initiative to set up a rapid reaction force of 60,000 men for peacekeeping and emergencies.

Foreign Minister Igor Ivanov even suggested that Russia was ready to cooperate with the force, which he described as a "completely natural" bid to look after the continent's security.

Analysts said Putin's Middle East moves might have been aimed at making Washington look uncomfortable. But their effect remained an open question.

"It is certain that Russia tried to take advantage of the situation. But just how much it is by design or by simple coincidence is difficult to gauge," said Ilya Kulikov, a political correspondent for ORT public television.

TITLE: Looting and Neglect Are Sucking Chechnya Dry
AUTHOR: By Yevgenia Borisova
PUBLISHER: Staff Writer
TEXT: MOSCOW - Oil, metals and other valuables are being spirited out of Chechnya in enormous quantities by thieves - many in federal military uniform - while a trickle of Russian government funding headed back into the region seems mostly to have gone astray.


Officials of Akhmed Kadyrov's Chechen administration and officers of the Russian Interior Ministry agree that the looting of Chechnya, which has been underway for years, today is raging anew.

"The looting of the republic is in full swing," said a report written by Vasily Boriskin, who heads the energy department of the Kadyrov administration, for federal authorities. Shamil Beno, head of Kadyrov's office in Moscow, agreed. "Looting is happening on a daily basis," he said.

Boriskin's September report said shipments of metals and oil leave the republic on military transport, often under guard by federal troops. The report put damages this year to the energy sector of Chechnya alone at around $2 billion.

"Things have not gotten any worse since September [when the report was issued], but they haven't gotten any better either," Boriskin said Monday in a telephone interview from Gudermes.

Boriskin's account was partially backed up last week by Gen. Yev ge ny Timlev, a top Interior Ministry official, who told Vremya Novostei that "several interesting cases involving massive theft of Chechnya's oil-drilling equipment are now under way." Timlev told the newspaper that among those under investigation was an unnamed top military official.

Meanwhile, the Finance Ministry has allocated only 2.268 billion rubles ($82 million) this year to keep Chechnya afloat - a third of what Chechnya was supposed to get, according to a plan for reviving the region approved Aug. 29 by the cabinet. In a statement, the Finance Ministry said that the remaining 5.7 billion rubles ($206 million) "will be allocated fully by the end of the year."

Meanwhile, teachers, doctors and police in Chechnya have gone unpaid for months. Most hospitals are without medicines and most buildings without heat or light, as gas pipes and power lines are taken down and stolen as fast as they are put up. Not a single apartment block has been reconstructed.

"Our families are hungry, there is nowhere to live and for many months we have not been getting our wages," said a teacher at a protest last week in Chechnya, broadcast by NTV television.

Teachers last week went on strike indefinitely. Khizir Gerziliyev, Chechen Teachers Union head, told Interfax that some had not been paid since March.

A Finance Ministry official, who asked not to be named, said there had been a delay in sending federal funding because of bureaucratic glitches created when the Kadyrov administration replaced the previous one of Deputy Prime Minister Nikolai Koshman.

But while the Finance Ministry said that 25.8 million rubles ($930,000) had been transferred to the Kadyrov administration to cover its expenses, Beno said it had not yet arrived.

"We are waiting for it. We know that the order to transfer the money was at last given on Oct. 27," he said. "But we also know that it does not take two days for money [wires] to go through. Maybe the money goes to Siberia first? In a big suitcase? And by foot?"

"Even when they do arrive, these allocations are just laughable," Beno continued. "Look at the funds allocated for refugees of 50 million rubles [$1.8 million]. Let's say there are only 100,000 displaced people within Chechnya. That equals 500 rubles [$18] per person. That sum must cover food, tents, infrastructure and medical care."

Beno said with such funding, each refugee within Chechnya would be able to receive a mere 50 grams of bread a day. "Even in besieged Leningrad [during World War II], people were eating better," he said. "It's idiocy, just idiocy."

As a result, many refugees now outside the borders of Chechnya have no plans to return home, preferring instead to shiver in their thin tents in Ingushetia.

Another result of such poverty is that anyone with arms - including the police themselves - is a potential looter.

"Imagine 3,500 people with weapons are thrown out onto the streets. They are not paid wages, they are not being fed. Thank God they just stole a piece of energy equipment and sold it," Grozny Mayor Beslan Gantamirov said in an interview earlier this month with Versia. "It is even good," he added with a laugh. 

Good or not, it is certainly happening on a daunting scale.

Consider Grozneft, an oil company of obscure origin and status, that was recently managing the entire republic's oil complex. According to Boriskin's survey of looting in Chechnya, "Ten thousand tons of pipe worth about $150,000 were stolen [from Grozneft] by local criminals accompanied by the [federal] military."

Or consider the oil extraction in Pravoberezhnoye, where employees tried to stop thieves from siphoning oil from one of their wells. "Firing by the military prevented them from getting close to the thieves who, once they finished their work, left without any problems in the direction of Argun," Boriskin's report said.

"Restored power lines are getting stolen," the report continues. "One power line was restored by energy workers three times, and three times was stolen. Overall, more than 45 kilometers of power lines built anew have been stolen."

TITLE: Bush Edges Toward U.S. Presidency
AUTHOR: By David Espo
PUBLISHER: The Associated Press
TEXT: WASHINGTON - George W. Bush took on the work, if not the title, of president-elect on Monday, meeting with a top aide to discuss a transition to the White House. 


Al Gore challenged his rival's Florida victory in court, arguing that thousands of votes "have never been counted." The American system depends on "an election where every vote is counted," Gore said in a nationally televised conference call with the Democratic leaders of Congress. 

Florida Secretary of State Katherine Harris, a Bush partisan, certified Bush the winner late Sunday with a 537-vote margin over Gore out of some 6 million votes cast - a 0.01 percent margin. 

If the Republican Bush prevails, he would have just one vote to spare in the Electoral College that determines the U.S. presidency. If he retains Florida's 25 votes, he'll win 271-267, assuming all electors vote as they have pledged. 

An overnight poll by ABC and The Washington Post found that 60 percent of those surveyed thought the Democratic vice president should concede. Thirty-five percent said he should not.

Gore won the nationwide popular vote by more than 300,000 votes.

As Gore was carrying on his fight, Bush, the Texas governor, sat down with advisers in preparation for becoming the nation's 43rd president. 

"We may just open our own transition office," said Andy Card, Bush's choice for White House chief of staff, as he arrived at the Texas state capitol Monday morning.

The government agency responsible for securing official transition offices in Washington has said it won't yet turn the keys over to the Republicans. But Card said, "We know how important it is to keep moving."

A few hours later, Gore's lawyers went to court in Tallahassee, Florida, formally contesting the election results in Palm Beach, Miami-Dade and Nassau counties. They asked the court to "certify that the true and accurate results of the 2000 presidential election in Florida" show the Democrats as the winners. 

"The vote totals reported in the election canvassing commission's certification of Nov. 26, 2000, are wrong," the Gore campaign argued. "They include illegal votes and do not include legal votes that were improperly rejected. The number of such votes is more than sufficient to place in doubt, indeed to change, the result of the election." 

The party's Democratic leaders flew to Florida during the day to lend their support to the vice president. House Democratic leader Dick Gephardt said the proclamation of Bush's victory by the Florida secretary of state was "incomplete and inaccurate, and it's premature for either side to declare victory or concede because the fact is all the votes are still not in."

Gephardt and Senate Democratic leader Tom Daschle participated in a nationally televised conference call with Gore and his running mate, Joe Lieberman. 

Gore thanked the leaders for their support and said, "Under Florida law, the law says when votes haven't been counted you go to court and say, 'Look, here's the situation: Take a look at it and do the right thing.' And that's essentially what we're doing in court." 

Gore was to give a prime-time address to the nation Monday night.

Republicans said in advance that Bush aides would aggressively fight Gore's contests, but not file any of their own. 

Bush said after the Florida certification of his victory that Gore should give up the contest. 

"If the vice president chooses to go forward, he is filing a contest to the outcome of the election," Bush said. "And that is not the best route for America."

In certifying the Republican ticket of Bush and Dick Cheney the winner, Harris said:

"On behalf of the state elections canvassing commission, and in accordance with the laws of the state of Florida, I hereby declare Gov. George W. Bush the winner of Florida's 25 electoral votes." 

Her remarks touched off a wave of noisy cheering from Bush supporters gathered outside the state government building in Tallahassee where Harris and other members of the state canvassing board signed multiple copies of the official certification.

TITLE: Plan for Tunnel to Sakhalin Unveiled
AUTHOR: By Alla Startseva
PUBLISHER: Staff Writer
TEXT: MOSCOW - The Russian government is talking of reviving a grandiose Stalin-era project to build a 10-kilometer tunnel under the Pacific Ocean to connect the mainland to the island of Sakhalin and then adding a 40-kilometer bridge over the ocean to connect Sakhalin to Japan.


Officials from President Vladimir Putin on down have been talking up the project and suggest it could be under way by the end of next year. 

They are doing so despite an unusually sour Japanese response to the idea, including Japan's firm insistence that it will not put a dime into what Moscow says would be a $50 billion affair.

Railways Ministry officials say the ultimate plan is to lay rails from Japan to England. Valery Yudin, a spokesman for the ministry, said "several business plans" regarding the venture would be presented next month to the ministry's top officials.

Railway Minister Nikolai Aksyonenko went a step further, telling Interfax this week that by the end of next year, his ministry "really will start construction of the tunnel under the Tatarsky Straits, which will connect the mainland with Sakhalin."

A tunnel under the straits, which are about 10 kilometers across at their most narrow point, was begun in the 1940s, and apparently workers made it almost to the half-way point. But the project was abandoned after Stalin's death and it was not clear this week if the digging done half a century ago could still be used.

After the tunnel is built, the plan is to hang what would be the world's largest bridge, stretching 40 kilometers across the Pacific, from Sakhalin to the Japanese island of Hokkaido. At the moment, the world's largest bridge is the Seti-Ohashi, a 14.5-kilometer span between the Japanese islands of Honshu and Shikoku.

Railways Ministry officials say the massive infrastructure investments would pay for themselves in 15 or 20 years. Thanks to the certain increase in cargo transit between Europe and Japan alone, Railways Ministry officials told Itar-Tass, the Russian budget could earn an additional 20 billion rubles (about $750 million) annually.

German Gref, the Economic Development and Trade Minister, told Itar-Tass that the project would probably attract $10 billion in new foreign investment from countries looking to invest in Asia, including Japan and the United States, in the near future.

If so, that would dwarf the $4.78 billion in foreign investment Gref's ministry says Russia earned in the first half of this year.

But Japan, for one, is not clamoring to participate. 

"Russian-Japanese relations can be characterized by one word: stagnation," said the Japanese foreign minister, Yohei Kono, in Moscow on Thursday.

Kono had come for talks with top Russian officials about trade and also about the Kurils - islands next door to Sakhalin that were seized by the Soviet Union in the final days of World War II. Japan wants them back.

A foreshadowing of Kono's blunt talk of stagnation was offered last week in an unusually critical interview in Segodnya newspaper with Yasahuri Kawamura, a Japanese Foreign Ministry official: Kawamura said foreign investment in Russia is all but impossible because of red tape, punitive taxes and a lack of transparency in business deals.

"The government of Japan does not intend to participate in the elaboration of this [tunnel-and-bridge] idea," said Akira Imamura, a consular official with the Japan Embassy, in a telephone interview Thursday. "The tunnel needs very big investments. Investors need confidence in its repayment, but there is none yet."

Imamura added that the real problem with moving cargo from Japan to England via Russia was not a lack of monster tunnels and bridges, but everyday problems with the Trans-Siberian Railway.

"Due to big problems with safety ... and security, Japanese companies do not want to use the Transsib. If these problems are resolved, the Transsib could be a shorter, easier, cheaper and real route from Japan to Europe," he said.

Some observers of the Russian economy expressed strong skepticism of the Tatarsky Straits tunnel and the Sakhalin-Hokkaido bridge.

"It is hard to believe the reality of this project," said Yaroslav Lissovolik, an economist from the brokerage Renaissance Capital. He added the only thing harder to believe would be that foreign investors would ever step up to finance it.

TITLE: Former Japanese Naval Officer Admits Selling Secrets to Russia
AUTHOR: By George Nishiyama
PUBLISHER: Reuters
TEXT: TOKYO - A former Japanese naval officer admitted in court on Monday that he had sold defense secrets to a Russian military attache in Japan's most sensational espionage case in two decades.


The trial opened just a day before Russian Defense Minister Igor Sergeyev is due in Tokyo for a regular visit.

"[The charges] are all true. I apologize for putting Japan's national security in jeopardy," public broadcaster NHK quoted Shigehiro Hagisaki, a 38-year-old former lieutenant-commander in the Maritime Self-Defense Force, or navy, as telling a court hearing.

In Japan's biggest spy scandal in 20 years, Hagisaki was arrested in September for allegedly giving classified information to a military attache at the Russian Embassy.

It was the most high-profile case of spying since a military attache at the Soviet Embassy in Japan obtained copies of a military monthly bulletin and official telegrams related to the Foreign Ministry through a Japanese major-general in 1980.

Hagisaki has been charged with violating the Self-Defense Forces Law, which prohibits members from divulging classified security information.

The case has caused a major sensation, receiving saturation coverage in newspapers, on television and on the radio.

TITLE: Gusinsky Seeks Media Investor
AUTHOR: By Joan Gralla
PUBLISHER: Reuters
TEXT: NEW YORK - Russian self-exiled media magnate Vladimir Gusinsky said on Sunday he was looking for a foreign investor to buy a sizable stake as soon as Christmas in Media-MOST group's television network NTV, which has been critical of President Vladimir Putin's administration.


Gusinsky, who spoke to Reuters by telephone from Spain, said: "We have several proposals now. Maybe before Christmas or immediately after we can negotiate this with our allies."

Gusinsky left Moscow after being jailed in the city's Butyrskaya prison for three days in June on embezzlement charges. His recent refusal to return to Moscow to meet prosecutors led them to issue an arrest warrant on the same charges.

In mid-November, the businessman, a prominent leader of Russia's Jewish community, lost control of the Media-MOST empire he built after Gazprom, the state-dominated natural gas monopoly, received shares in the company under a deal to cover his debts to the utility.

Asked how the relationship with Gazprom was proceeding, Gusinsky replied: "No problem. Everything is working okay."

Gusinsky declined to disclose how much a stake in Russia's only nationwide independent television network might fetch.

A source involved in the negotiations who declined to be identified, said the price might run from $200 million to $400 million. 

That was higher than an estimate made on Nov. 17 by Gazprom Media chief Alfred Kokh, who said Gazprom and Media-MOST would try to sell a 25 percent blocking stake of NTV to a foreign investor for at least $90 million.

Part of the strategic plan includes seeking a listing on the NASDAQ stock market next year, Gusinsky said.

The fight to control Media-MOST and attacks on Gusinsky have been seen by him and critics of Putin as attempts to throttle the freedom of the press. 

The Kremlin denies it wants to crack down on the media and says the Media-MOST debt-settling deal with Gazprom was purely commercial.

Putin vowed that "oligarchs," powerful businessmen who used their vast wealth to call favors under former President Boris Yeltsin, would see their influence wane under his rule.

Saying the legal system was being used as a weapon by political leaders, Gusinsky said he would not return to Moscow unless both the prosecutors and courts worked independently. 

"I would come back if the legal system worked like an independent legal system," he said. "Now, unfortunately, it's not independent."

Gusinsky said he believed Putin and his team hoped that by reissuing the arrest warrant for him they would get journalists to pull back from hard-hitting stories.

On Nov. 20, the prosecutors called in NTV anchor Yevgeny Kiselyov to answer questions in a probe about Media-MOST's security service, which is alleged to have spied on other companies and on some government agencies.

Media-MOST denies this, and says it does not even have a security service.

"It's pressure ... people must be afraid to be critical of the government and [Putin's] policy," Gusinsky said.

Kiselyov, the first journalist to be questioned in connection with attempts to rein in the oligarchs, told reporters he saw no political undertone about him or NTV in the questions he was asked, which related to how NTV had gotten documents for items broadcast three years ago about the disputed privatization of the aluminum industry.

TITLE: President Urges Judges To Lead Reforms
AUTHOR: By Daniel Mclaughlin
PUBLISHER: Reuters
TEXT: President Vladimir Putin told Russia's judges on Monday they were overworked and underpaid, but urged them to be more aggressive in trying to establish the rule of law over his corruption-riddled country. 


Putin has pledged a "dictatorship of the law," making Russia's legal system work and smoothing out the disorder and chaos of the years after the collapse of the Soviet Union. 

Critics at home and abroad say reforming the judiciary is a key to his plans to bring greater order, although they note that progress so far has been minimal. 

"The aggressiveness and decisiveness of our judicial system has slipped and it has begun to get bogged down in interdepartmental arguments," Putin told a congress of judges. 

He said he was doing all he could to support their battle against rising crime, but that the system was creaking under the weight of thousands of untried cases and growing internal arguments. 

"Shortcomings and errors in the judicial system are allowing the rise of legal nihilism," he said. 

He said the judiciary's workload had trebled over the last six years, and more than 5 million Russians pass through the country's courts each year. 

But it was unacceptable that more than 3,000 Russians were stuck in detention without trial for one to two years, he said. 

"You can explain it however you like, but it's impossible to justify yourself indifferently to people about this," he said. 

About 1 million Russians are packed into the country's overcrowded and dilapidated jails. 

Putin said a lack of finance and manpower was hampering efforts by the courts to improve their work, but the 2001 budget would increase by one third the amount of state funding for the legal system. 

Unlike many of Russia's professionals, judges had received their full wages on time this year, Putin said, adding that he had already raised judges' and lawyers' wages to try and attract more people to the bench. 

"There are too few judges in Russia, and their number does not satisfy demand." 

Putin's remarks were made against a backdrop of widespread corruption and red tape, which foreign investors find difficult to cope with. The public is also used to having to pay bribes to police and petty officials. 

Tom Adshead, political analyst at Moscow brokerage Troika Dialog, said the first six months of Putin's presidency had failed to deliver a less corrupt and corruptible legal system. 

"The most important thing is to show that government officials at all levels have to obey the law ... at some point there has to be a case where a member of the government is taken to court and loses," Adshead said. 

Adshead said it was good to see legal reform creeping higher on the Kremlin's agenda, even if Putin stopped short on Monday of making any concrete reforms. 

"There are plenty of problems and defects in our judicial system," Putin said. "But that's no reason for a complete overhaul."

TITLE: IN BRIEF
TEXT: Navy Late To Sue Pope

MOSCOW (AP) - The judge in the espionage trial of U.S. businessman Edmond Pope on Friday rejected a civil suit from the Russian Navy demanding $255 million from Pope.

Pope is accused of obtaining and transferring to the United States plans for a high-speed torpedo.

The judge rejected the suit, saying it had to be filed before the criminal trial began, Pope's lawyer Pavel Astakhov said. However, a separate civil suit could be filed after Pope's trial.



Kursk To Be Raised

THE HAGUE, The Netherlands (Reuters) - Russia aims to hoist the sunken Kursk from the Barents Sea next summer in a $70 million international project. 

Lifting the submarine is "the best solution because it will remove a potential source of contamination of the waters of the Barents Sea," Russian Ambassador to the Netherlands Alexander Khodakov said Wednesday. 

A 500,000 guilder ($191,300) feasibility study sponsored by the Dutch government is under way, Khodakov said. 

The Kursk Foundation, chaired by two former Dutch and Russian ministers, is coordinating the feasibility study. 



Gazprom Sells Shares

MOSCOW (SPT) - Gazprom is to start discussions next week on selling some of the shares it holds in NTV to foreign investors, a Gazprom official was quoted by The Associated Press as saying Thursday.

The discussion is to begin Monday with Germany's Deutsche Bank, said an official from Gazprom-Media, who declined to give her name.

A 25-percent-plus-one stake in NTV is to be sold to an unspecified international investor through Deutsche Bank for at least $90 million.



Maskhadov Ultimatum

GROZNY (AP) - Chechen President Aslan Maskhadov ordered Chechnya's pro-Moscow mayors and other civilian leaders to surrender their posts or be removed by his rebel commanders. 

In addition to daily attacks on Russian military checkpoints and convoys, Chechnya's rebels have increasingly targeted Russian-backed Chechen officials, undermining Moscow's ability to control the breakaway republic. 

Maskhadov on Saturday night ordered his commanders to deliver a letter to the local leaders reading: "National traitors are responsible for our difficulties. Those who work for the occupants, leave your posts within 24 hours." 



Discussions With Iraq

MOSCOW (AP) - Iraqi Deputy Prime Minister Tariq Aziz is to visit Moscow next week for talks, Deputy Foreign Minister Vasily Sredin was quoted as saying Friday.

Sredin said Aziz would be in Moscow for talks with Foreign Minister Igor Ivanov from Tuesday to Thursday, Interfax reported.

Sredin, the presidential Middle East envoy, said discussions would focus on resolving Iraq's problems with the international community.



Visa Rules Hurt

BERLIN (Reuters) - Yabloko leader Grigory Yavlinsky appealed to European governments to ease up their rules on obtaining visas and said tough screening proceedures only hurt students, workers, academics and other ordinary Russians wanting to go abroad.

"There are no gangsters in the lines for visas," he told a conference in Berlin on European economic and foreign policy issues. "I don't know how they get visas, but they are not standing in lines."

TITLE: Military Hits Back at Rebels With Security Measures
AUTHOR: By Lyoma Turpalov and Ruslan Musayev
PUBLISHER: The Associated Press
TEXT: GROZNY - Responding to new rebel raids, the federal authorities beefed up security in Chechnya on Monday and said they would close Russia's border with Georgia to stop insurgents from getting reinforcements. 


Chechen leader Aslan Maskhadov on Saturday ordered his field commanders to deliver a letter to local pro-Moscow administration heads, calling them "traitors" and telling those "who work for the occupants to leave their posts within 24 hours." 

The letter, shown to The Associated Press by a rebel representative Sunday, ordered field commanders to use "any means" to make the officials surrender their offices. It was unclear, however, whether the order would have much effect. Maskhadov's command over the fractured rebels is weak, and observers say the recent attacks on pro-Moscow Chechens have been scattered rather than part of an organized strategy.

The federal authorities have responded with a security swipe in Grozny and other parts of Chechnya. Except for police and military vehicles, traffic into and out of Grozny was halted Monday while federal troops rounded up people at the central market and elsewhere for spot document checks and sniffer dogs examined transport for explosives. 

The beefed-up security brought traffic in Grozny to a virtual halt Monday, making many people unable to get to work but failing to prevent new violence. Lyubov Netsvetova, an administrative worker at Grozny's university, was fatally shot in the head at the building's doorstep by unidentified gunmen who fled. 

As of Monday, Chechen insurgents had staged eight attacks on federal positions over the preceding 24 hours, killing four servicemen, an official in Chechnya's pro-Moscow administration said. Another soldier was killed and three wounded when their truck struck a landmine in Grozny. 

In another attack Sunday, a colonel was shot dead by unidentified attackers in the village of Sernovodsk in western Chechnya, Kremlin spokesman on Chechnya Sergei Yastrzhembsky said in televised remarks Monday. 

He said Russia would strengthen the border with Georgia next month to prevent the flow of Chechen rebels. Georgian officials have repeatedly denied allegations that rebels were able to easily cross the porous, mountainous border. Since 1991, Russia has maintained a visa-free regime with all former Soviet republics, but it will introduce visas in relations with Georgia starting Dec. 5, Yastrzhembsky said. 

Russian planes and helicopters flew more than 25 combat missions between Sunday and Monday, striking targets in the southern regions of Itum-Kale and Vedeno, and the eastern regions of Argun and Nozhai-Yurt, he said. 

The official in Chechnya's pro-Moscow administration said Saturday that seven servicemen had been killed and 10 more wounded in a series of rebel attacks on federal positions over the preceding 24 hours.

TITLE: Putin Brokers Arafat-Barak Conversation
AUTHOR: By Ron Popeski
PUBLISHER: Reuters
TEXT: MOSCOW - Russia emphatically stepped back into the Middle East peace process Friday when President Vla dimir Putin got visiting Palestinian President Yasser Arafat to speak by telephone with Israeli Prime Minister Ehud Barak.


Israel immediately announced that its foreign minister, Shlomo Ben-Ami, would travel to Moscow next week. He and his Russian counterpart, Igor Ivanov, also spoke by telephone.

Russian diplomats were gratified at developments and pledged Moscow would use its "unique position" to promote peace in the region - particularly after a U.S.-sponsored summit at an Egyptian resort last month did little to halt Israeli-Palestinian violence in the West Bank and Gaza strip.

Israel said Barak and Arafat had agreed during the conversation, conducted as Putin watched in his Kremlin office, to resume operations at joint liaison offices. Ara fat also vowed to do everything in his power to end two months of fighting.

Arafat said after the meeting that all parties had agreed to act upon the pledges of the Sharm el-Sheikh summit - removing Israeli troops from near Palestinian towns, "stopping military action and aggression against our people and holy sites."

"Russia's role is very important as a co-sponsor of the peace process," he told reporters after meeting Russian Orthodox Patriarch Alexy II at his Moscow headquarters.

"That was shown by the three-way talks between myself, President Putin and Prime Minister Barak."

During the six-hour visit, Arafat also met Deputy Foreign Minister Vasily Sredin, special envoy to the Middle East.

Russia is co-sponsor of the Middle East peace process alongside the United States, but had been comprehensively sidelined. Moscow was not even represented at the emergency Sharm el-Sheikh summit, though Ivanov has toured the region twice since violence broke out in September.

First Deputy Foreign Minister Alexander Avdeyev, who attended the Kremlin talks, said Russia had advanced new ideas that "go beyond Sharm el-Sheikh" and that Barak and Arafat had said they would analyze. He did not elaborate.

"We must try to use Russia's unique situation as a friend of the Arabs and a country with a broad and trusting dialogue with the Israelis to persuade both sides to stop confrontation and move towards a Palestinian-Israeli peace," he said.

"We are for fulfilling Sharm el-Sheikh and, as co-sponsors, it is up to Russia and the United States to act together."

On Thursday, the Israeli army ordered the Palestinians to leave liaison bureaus, severing the last formal security link between the two sides after a blast at a joint office in southern Gaza killed an Israeli lieutenant.

After Friday's telephone call, Ba rak's office announced in Jerusalem that "Barak and Arafat agreed to maintain security cooperation on the field level and in this context to renew the operation of the liaison offices."

Barak and Arafat had last spoken by telephone overnight Sunday. Their last meeting was at Sharm el-Sheikh.

As the talks started, Putin said: "We are very concerned about what is happening. So many years have been spent on the peace process. All this is now on the brink of catastrophe.

"We are convinced of one thing: All these meetings will be pointless unless we contain the level of violence," he added.

Ivanov told Itar-Tass that, as co-sponsor of the peace process, Russia wanted a "workable mechanism" to halt violence in Israel, the West Bank and Gaza and restart talks.

TITLE: Power Shortage Shuts Down Chernobyl
PUBLISHER: The Associated Press
TEXT: KIEV, Ukraine - Ukraine's Chernobyl nuclear power plant was shut down early Monday after an ice-covered power line broke and caused an electricity shortage, officials said. 


Reactor No. 3, the plant's only working reactor, was closed down by its automatic safety system and workers plan to restart it on Saturday, a plant spokesman said. 

There were no malfunctions in the reactor and no radiation leaks were reported. 

Ukraine has said it will permanently close the nuclear power plant on Dec. 15. Ukraine promised to shut Chernobyl down after years of pressure from European governments and environmentalists. 

The plant's reactor No. 4 exploded and caught fire on April 26, 1986, sending a radioactive cloud over much of Europe in a disaster believed to have eventually killed thousands of people. 

Chernobyl's No. 2 reactor was shut down after a fire in 1991, and reactor No. 1 was halted in 1996. 

The remaining reactor has been the focus of disputes between international groups concerned over the safety of energy-strapped Ukraine, which fears losing the electricity the reactor provides. 

It has been shut down frequently by automatic safety systems over the past year due to various malfunctions. 

Also on Monday, the No. 2 reactor at Ukraine's Yuzhna power plant was shut down due to a malfunction, the State Energoatom nuclear company said in a statement. 

Currently, nine of 14 nuclear reactors are working at Ukraine's five atomic power plants, producing about 40 percent of the country's electricity.

TITLE: Museum To Monitor Intellectual Property
AUTHOR: By Galina Stolyarova
PUBLISHER: Staff Writer
TEXT: Battling Russia's image as a black hole with respect to intellectual property, the Na bo kov Museum in St. Petersburg is spear heading a long-term project launched this fall that could affect the work of hundreds of cultural organizations: monitoring copyright laws in arts and culture.


Funded jointly by the Open Society Institute, the U.S. Consulate and a handful of others, and running through to the end of 2001, the initiative aims to spread awareness of the ins and outs of copyright throughout the Northwest region.

More sinister than that, however, are claims that the publishing industry benefits financially from ignoring copyright and other contractual obligations.

"The project's goal is to encourage cultural managers to apply copyright law by distributing information about the methods and practice of its application," said Ol ga Vo ronina, deputy director of the Na bo kov Museum and head of the project.

Problems arising because of a lack of knowledge of copyright law are partly a hangover from the Soviet era, when the concept of intellectual property was largely ignored.

This has led to confusing and often farcical situations, such as Russian theater companies being forced to cancel tours abroad because they never bothered to get permission to stage the foreign play they intended to bring.

Even though Russia signed up to the international Bern Convention on copyright in 1994, it is taking time for the copyright mentality to take root. 

Copyright law is not taught enough - if at all - in humanitarian universities, which means that administrators and managers in Russian museums and theaters start out with inadequate knowledge of the subject.

And publishers are reportedly prepared to use strong-arm tactics to force authors into signing contracts that would be totally rejected in other countries.

"Normally, a Russian publishing house will offer a contract without a single word about print run, hard or soft covers, or even what language the work will be published in," said best-selling Moscow writer Anna Malysheva in an interview last month.

"Authors' rights are frequently violated, particularly with [unknown] writers." Malysheva said that physical threats were not uncommon if authors disagreed with the terms of their contract.

So the new project aims to improve the situation by spreading awareness of intellectual property rights.

To begin with, they will be launching a Web site in early February, where arts managers and lawyers will be able to share experiences and exchange information about problems they face.

Also in February, the Nabokov Museum is organizing an international conference for Western experts to discuss various aspects of copyright with their Russian counterparts.

Changing the existing law on copyright is not the idea, say the project's initiators. Instead, they want to show how to use and interpret it.

Irina Ivanova, research manager for Gallup in St. Petersburg found that many local arts managers admitted to ignorance on the subject, and were keen on the idea of consultancy services.

Alla Shpanskaya, general director of the Odeon production company, said she would welcome more independent agencies offering legal advice on copyright.

"At the moment, copyright awareness is in an embryonic stage," she said in an interview on Thursday, "so you cannot expect it to be effective.

"In Western countries, labor unions are very powerful and provide a watchful monitoring of copyright [infringements], but in Russia, special agencies have yet to be created." Where conflict arises, Shpanskaya said that personal contacts and private agreements were more influential than the law.

Yekaterina Novikova, deputy director of the St. Petersburg Philharmonia, said that copyright rules very loosely applied.

"In Britain, if a photographer wants to take a picture of a concert or a show, he has to get permission from everyone on stage," she said. "In Russia, officially the photo belongs to the person who took it, even if those being photographed don't want their picture published."

TITLE: Moscow Says U.S. Can't Veto Trade With Iran
PUBLISHER: Reuters
TEXT: WARSAW - Russian Foreign Minister Igor Ivanov on Thursday shrugged off a U.S. threat to impose new sanctions on Moscow over arms sales to Iran and said it alone would choose its own trade partners.


Ivanov, addressing a news conference alongside his Polish opposite number, Wladyslaw Bartoszewski, made no reference to Russia's decision to pull out of a 1995 deal with Washington on curtailing arms sales to Tehran.

But he made clear Moscow would stand for no interference in pursuing its trade interests, dismissing a U.S. list including Iran among states alleged to sponsor terrorism along with Cuba, Iraq, Libya, North Korea, Sudan and Syria.

"Russia bases its acts on close adherence to its international commitments, also in the case of Iran. We will continue to do so," he said in response to a question about the deal.

In Moscow, Russia's Foreign Ministry declined to comment on U.S. reports that new sanctions could be imposed on Moscow after Ivanov informed Washington just before the U.S. presidential election that it was backing out of the deal.

Interfax quoted unidentified sources as saying the decision was linked to "positive changes in Iran's internal political situation." They also said the United States had violated the accord by publicly disclosing its terms.

Russian Defense Minister Igor Ser ge yev, also in Moscow, made no comment on the Russian withdrawal from the agreement. But Interfax quoted him as saying no arms of mass destruction would ever be supplied to Iran.

TITLE: U.S. Chides Russia on Pledges
AUTHOR: By Richard Murphy
PUBLISHER: Reuters
TEXT: VIENNA - The United States called on Russia on Monday to fulfill pledges it made a year ago to allow an international mission into Chechnya, withdraw troops from Moldova and Georgia and implement cuts in conventional forces.


Speaking at a meeting in Vienna of foreign ministers from the Organisation for Security and Cooperation in Europe (OSCE), U.S. Secretary of State Madeleine Albright said it was tragic that key issues still remained unresolved.

OSCE heads of government meeting in Istanbul last November called for a political settlement in Chechnya with international help. But despite Russia's pledges, an OSCE "Assistance Group" has still not returned to the troubled region.

"The OSCE can play a valuable role on the ground in Chechnya," Albright told the 55-nation security and human rights watchdog. "I call upon the Russian government to agree to an early date for the group's return."

At last year's Istanbul summit, leaders adopted a landmark charter proclaiming that conflicts in one state are the legitimate concern of all.

They also signed a major new arms control treaty for Europe, updating limits on armed forces and heavy equipment set in the dying days of the Cold War in 1990.

Russian Foreign Minister Igor Ivanov did not directly respond to Albright's comments in his opening address, but expressed concern about a trend among Western OSCE countries to do little more than lecture Eastern European countries.

TITLE: THE TAX ADVISER
AUTHOR: Tom Stansmore
TEXT: A Tax Code II Guide to the 1st 183 Days 


Most of you are aware that the passage of amendments to the Tax Code which will become effective beginning Jan. 1, 2001, replaced Russia's three tax brackets with a flat 13 percent personal income tax rate. Because the amendments did a number of things in addition to changing the rate, application of the law to expatriates working for representative offices in Russia is about as clear as the results of a U.S. Presidential election.


Part of the confusion comes from the fact that the lower rate applies to salaries earned by natural persons who are tax residents. Meanwhile, a 30 percent rate is provided for natural persons who are not tax residents of the Russian Federation.

Fortunately (I think) the code also defines Russian tax residents: "natural persons who stay in the territory of the Russian Federation for not less than 183 days of a calendar year." In other words, those who stay in Russia for more than 183 cumulative days during the calendar year will pay at the 13 percent rate, while those who receive compensation for being in Russia on a short-term basis will be taxed at the 30 percent rate.

That clears things up, right? Not exactly. The problem is that according to this definition, because on Jan. 1, 2001, no one will have been in Russia for 183 calendar days (not even Russians), no one will be a tax resident.

Moreover, the Tax Code specifies that, beginning Jan. 1, Russian legal entities and permanent establishments of foreign legal entities will be held as tax agents and must withhold taxes when paying an employee. As many expatriates are employed by the head office of an offshore entity that has a Russian Representative office, the question quickly becomes: at what rate should the head office withhold income on behalf of their employee, 13 percent or 30 percent?

As I'm a big fan of the single rate, I would prefer that my employer pick that one. From the point of view of my employer, however, should I, for any reason, decide to skip town before my 183 days are up, the tax authorities could hold them accountable for not withholding at the 30 percent rate and charge them with the difference. In other words, from the point of view of most employers (and enforced by a strict interpretation of the wording of the code), it's in their best interest to withhold at the 30 percent rate. Once the 183 day mark has been passed by the employee, it may no longer be necessary to withhold, and at the end of the year, a refund for any excess paid may be sought.

Another issue is whether the employer may pay the withheld amount in foreign currency from an offshore account, or need they convert to rubles (requiring them to open a Russian ruble bank account). The code calls for payment in rubles in most cases but states payment may be made in foreign currency in the case of "foreign organizations, and natural persons who are not tax residents of the Russian Federation."

Some have voiced concern that the wording may be interpreted so that the term "who are not tax residents" may also apply to "foreign organizations." Others have indicated this is stretching it a bit and that "foreign organizations who are not tax residents" does not make much sense, especially in light of the "tax resident" definition included in the code.

I called my tax inspector and told her my employer was going to withhold from my salary (at 13 percent) and wanted to transfer hard currency directly into their account. She faxed me the hard currency account details of the St. Petersburg Tax Inspectorate and said to go ahead.



Tom Stansmore is head of the St. Petersburg branch of Deloitte and Touche CIS. For more information or advice, call Deloitte and Touche at 326-93-10.

TITLE: Securities Watchdog Is Eyeing Foreigners
AUTHOR: By Boris Safronov
PUBLISHER: Vedomosti
TEXT: MOSCOW - The Federal Securities Commission (FSC) says it is going to insist on being informed when foreigners buy shares in local companies.


Russia's securities watchdog said on Friday that the notification must include a description of the transaction, the characteristics of the securities as well as the parties' and commissioner's details.

The FSC's announcement has been backed by a 1996 law on securities. However, the law has never been enforced.

The initiative, which has shocked market participants, can be explained by the commission's policy of expanding its control over the market. 

About half of the brokers interviewed by Vedomosti had to make urgent checks on the details of the law.

But the time of reckoning has come and the FSC is trying to establish maximum control over the market. 

The commission can easily monitor domestic investors' activities on local stock exchanges. 

The situation with foreigners is more complicated. 

Banks were able to fend off attempts by the FSC to register issues of American Depositary Receipts. Three weeks ago the commission asked western funds to provide information on their activities, but their request was largely ignored. 

But the long-forgotten law has now come in handy. 

Until it publishes regulations, the committee recommends that notification of the purchase of domestic securities be sent to it on the day the transaction takes place. If a professional participant of the securities market on the stock exchange conducts the transaction then the conditions are slightly softened. Information can be submitted five days from the end of the month in which the securities changed ownership. 

A representative with a major brokerage called the committee's initiative "senseless and dangerous."

"I do not understand what this will give and what they will do [with the information received]," said the representative. "This will all build up in the FSC and then disappear. All databases can be bought, and this one will also be sold - everyone will know exactly what goes where." 

Andrei Galperin, executive director with investment company Prospekt, said that the FSC could receive information on the majority of foreigners' transactions much more easily by requesting the Russian Trading System's transactions register. The RTS is the main trading floor for foreigners.

The FSC requirements may prove easy to get around. 

"An offshore barrier can be created to hide the true owner and complete the transaction not through a Russian broker, but directly on Cyprus," Gal pe rin said.

TITLE: Lenenergo Board Backs ADRs
AUTHOR: By Andrey Musatov
PUBLISHER: Special to The St. Petersburg Times
TEXT: At a meeting on Friday, the board of directors at local energy utility Lenenergo approved a plan to issue Level 1 American Depository Receipts (ADR's). James Gerson, head of investor relations at Lenenergo said that approval of the agreement with the Bank of New York was the last official step in a process the company began in August to allow the ADRs to be sold over the counter in the United States.


At the beginning of October, the U.S. Securities and Exchange Commission (SEC), the agency responsible for monitoring trade in securities, already granted Lenenergo an exemption from full registration requirements and gave Lenenergo and the Bank of New York the go-ahead to issue the ADRs. Following the filing of registration and of the depository agreement with the SEC, the Bank of New York will receive permission to begin selling the ADR's. The process should be complete by the end of the year.

Lenenergo's ADR issue will not be the first which involves the company's stock, although it will be the first actually sponsored by the utility itself. The Bank of New York at the beginning of this year already received 6.17 percent of Lenenergo shares from a private shareholder, which were then converted into ADRs.

Gerson said the fact that the shares involved earlier this year were not submitted in a Lenenergo-sponsored program meant that the SEC rules in that instance were different.

"The unsponsored Level 1 ADRs represented Lenenergo shares which have been established by a depository bank without the participation of the company," Gerson said. "The company is not required to provide any information to the SEC in this case."

Level 1 is the lowest level of ADR's, involving the deposit of a set number of already existing shares in the company at the Bank of New York. The Bank of New York then issues a number of shares for over-the-counter sale in the United States based on the Russian securities

In order to issue Level 2, a foreign firm must meet more stringent SEC requirements, including adherence the Generally Accepted Accounting Principle (GAAP) - the standard to which U.S. companies are required to follow in order to have their shares traded publicly. In the case of Level 3 ADRs, the issuing company is required to use the issue to raise new capital.

Lenenergo announced their intention to launch the Level 1 ADRs at the end of the August and, according to first deputy general director Kirill Androsov, this step was taken to improve the company's reputation and raise the liquidity of the company's shares. 

In comments made to Vedomosti in October, Androsov didn't specify what portion of the firm's shares would be involved in the sponsored ADR program.

"The volume will be determined by the level of investor demand, so it's difficult to say exactly what that will be," Gerson said. "However, we're anticipating that at least 6 percent, and as much as 11 percent, of the company's stock will ultimately be involved."

TITLE: Deloitte & Touche Gets Duma's Nod To Handle Audit of Russia's Books
AUTHOR: By Anna Raff
PUBLISHER: Staff Writer
TEXT: MOSCOW - Defying the wishes of the country's top banker, the State Duma on Friday voted overwhelmingly for awarding the 2000 Central Bank audit to Deloitte & Touche CIS over rival PricewaterhouseCoopers, which audited the bank in 1998 and 1999.


The decision means Deloitte & Touche, the bank's auditor in 1995, can once again list the Central Bank of Russia on its list of international clients such as the Bank of France, the Bank of South Africa and the World Bank.

However, despite the fact that by law the Duma has the last word on the decision, Duma spokesperson Oleg Zhukov cautioned that the audit isn't scheduled to begin until early next year and that Central Bank Chairman Viktor Gera shchen ko may try to find a way to give the job back to PricewaterhouseCoopers.

"The Central Bank is pretty independent nowadays, and it's still uncertain what steps Gerashchenko will and can take," he said.

Deputies voted 240-27 for Deloitte & Touche over PricewaterhouseCoopers (PwC) despite an appeal by Ge ra shchen ko, who emphasized his - and "the Central Bank leadership's" - support for PwC.

Some of the statements made by Gerashchenko as he sought support were incorrect, said Dan Koch, CEO of Deloitte & Touche CIS.

Deloitte & Touche audits are according to international accounting standards, contrary to Gerashchenko's accusation that the firm uses Russian standards. For this, Deloitte & Touche outsources and uses a Russian auditing firm, Deloitte employees said.

In his speech, Gerashchenko listed numerous reasons to vote for PwC.

He argued it had a stronger banking department, and also already audits foreign banks of which the Central Bank is a shareholder.

Gerashchenko failed to mention his personal fondness for PwC, however, a fact that has been ballyhooed by the Russian press. For Gerashchenko, PwC has become the "family" auditor, and no matter where he works, PwC has followed, the newspaper Segodnya reported last month.

Gerashchenko could not be reached for comment. PricewaterhouseCoopers declined to speak about its losing bid.

Coopers & Lybrand, which merged with Price Waterhouse two years ago, led the audit in 1993 and 1994.

Deloitte & Touche offered to do the audit for $350,000 plus 10 percent on overhead expenses this year, while PwC placed a bid worth $450,000, some 17 percent more.

Koch said he left a midday meeting to see a partner who had just returned from the Duma with news of the vote. Koch walked into the partner's office, greeted by the words: "We won."

"I'm absolutely delighted," Koch said in a telephone interview.

"I've remained hopeful throughout the whole process."

We decided this year to make a concerted effort at winning the Central Bank tender," Koch said. "And it's part of our strategy to increase our base in Russia."

The Duma also stipulated that Russian auditing firm FBK participate in some aspects of the audit.

The Duma's investigative body, the Audit Chamber, will be responsible for auditing the bank's secret accounts and operations.

TITLE: Central Bank and Kremlin Negotiating 'IMF Package'
AUTHOR: By Igor Moiseyev
PUBLISHER: Vedomosti
TEXT: MOSCOW - Just 20 minutes before deadline Friday, the government and the Central Bank submitted to the State Duma a group of amendments to the banking laws known as the IMF package. 


The new version by the government and the bank for changes to banking legislation was presented by Alexander Shokhin, head of the Duma's banking committee. The day before the committee had been considering rejecting the package on the first reading. 

Deputies agreed to relax their position only when Georgy Luntovsky, deputy head of the bank, and Anton Siluanov, head of the Finance Ministry's macroeconomic department, promised to submit within 24 hours an agreed version of amendments with the signatures of the heads of the government and the Central Bank. 

Shokhin said all the principal comments made by President Vladimir Putin and the deputies had been considered. 

Thus, the provision on the Central Bank's right to independently lower the charter capital of any bank to the level of its capital base in the event that the latter is reduced, which contradicts the Civil Code, was replaced.

The Duma received a more lenient version under which the bank must "express by accounting or other reporting means the amount of its capital base determined by the Central Bank." If its capital base is reduced, the Central Bank can request that the bank bring its charter capital into line with its capital base.

The index of capital adequacy ratio, which relates the bank's capital to its obligations, has been reduced to below 2 percent. The new edition also stipulates that a reduction to the level of capital adequacy must be supported by an arbitration court decision. And if, in the course of a year before the license is revoked, various methods for calculating the capital adequacy have been applied, then the method that gives the maximum capital adequacy is to be used.

Putin may reject the amendments. The government and Central Bank have not cleared them with the president's main state and legal department.

TITLE: Yashin Speaks Out To Assure Shareholders
AUTHOR: By Elizabeth Wolfe
PUBLISHER: Staff Writer
TEXT: MOSCOW - As gears move on the mammoth restructuring of the country's floundering telecoms industry, Svyazinvest director Valery Yashin is seeking to calm any misgivings of shareholders in the country's 80-plus telecoms, which will be merged into seven regional holdings.


At a news conference Monday, the head of the national telecoms holding emphasized that shareholders' rights and interests are at the top of the list during the massive consolidation of its subsidiaries, which some industry observers estimate will take until the end of 2003 to complete.

Yashin said the companies' values and the swap ratio for stocks would be appraised starting in the first half of 2001. The restructuring will push the value of Svyazinvest up 170 percent to $3.8 billion, he said.

"The unification process for the daughter companies is moving along not without difficulties," Yashin said.

Earlier this month, officials in the Siberia region formed the "Siberian Agreement" in opposition to the restructuring. One governor said that the sector's reorganization would result in the emergence of new oligarchs, while Krasnoyarsk Governor Alexander Lebed said it would bring about a "deep crisis."

Yashin said Svyazinvest is working with regional administrators to explain the restructuring and address concerns about where the taxes from the consolidated companies will go. 

Svyazinvest has agreements with financial advisers for six of the seven regions. Alfa Bank will act as advisors for Siberia and the Far East, Renaissance Capital for the northwest and south, the Gamma Group for the Volga region and LV Finance for the Urals.

Plans are moving along in the Northwest, where the $207 million (according to present market capitalization of companies involved) merger of three St. Petersburg telecoms was given the nod early this month after one shareholder lost his court challenge to halt the process. The new company retains the name of Petersburg Telephone Network (PTS), which is absorbing two others local telecoms. Under the scheme outlined Monday, nine more regional companies will come under PTS' name.

TITLE: Ministers, Oil Barons Battling Over Taxes
AUTHOR: By Lyuba Pronina
PUBLISHER: Staff Writer
TEXT: MOSCOW - Top cabinet ministers say the nation's oil companies are evading taxes on a startling scale and are pledging a crackdown. Oil barons counter that in a clumsy search for revenue now that the IMF has apparently let Moscow down, the government is ready to risk killing off the industry.


A Finance Ministry study of tax evasion in the oil industry "surpassed all of our expectations," said Finance Minister Alexei Kudrin on Thursday.

He said the oil companies are evading taxes at a staggering rate, and said he would report on his findings in the nearest future to President Vladimir Putin.

Federal Tax Police chief Vyacheslav Soltaganov is talking equally tough.

"We have come to a point where we know all about the oil companies and they know this," Soltaganov said Friday. He said his law officers were cooperating with the Tax Ministry and the Economic Development and Trade Ministry to develop new tax rules and enforcement practices to close off loopholes.

Rapid action in the form of a presidential decree may be in the offing.

The newspaper Vedomosti reported Friday, citing a source in the Tax Ministry, that Tax Minister Gennady Bukayev has been instructed by the Kremlin to prepare a draft of a decree that would end the controversial practice of corporate pricing.

Corporate pricing is when a company's oil extraction unit sells oil to the parent company, or the parent company's offshore arm, at artificially low prices - on grounds it is all happening inside one company. The arrangement dramatically lowers the official, taxable price of oil.

According to a report by the independent Fuel and Energy Institute, the average corporate oil price in 1999 stood at $27 per ton of crude oil - while the average export price of Russian oil was $110.50.

In addition to corporate pricing, the government has laid a threatening hand on the export faucet: the state-owned system of pipelines, Transneft.

Deputy Prime Minister Viktor Khris tenko - who was earlier this month put in charge of parceling out oil export quotas via Transneft by President Putin - has talked of forcing oil companies to bid for some such quotas at auctions. As it is now, oil companies strike secret deals with Transneft for access, an arrangement seen as fertile for corruption.

Oil company executives are hitting back. Four top oil barons - Vagit Alek perov of LUKoil, Mikhail Kho dor kovsky of Yukos, Yevgeny Shvidler of Sibneft and Simon Kukes of Tyumen Oil Co. - this week sent a letter to Prime Minister Mikhail Kasyanov declaring their opposition both to Khris tenko's export quota auctions and Kud rin's talk of a tax crackdown.

"[These initiatives] do not help [oil companies] to use the favorable world situation for resolving the problems of the sector," Vedomosti quoted the letter as saying. On the contrary, "they are directed at limiting the ability of the oil companies to carry out large investment projects."

Charging for access to export pipes, meanwhile, is simply "the introduction of an extra tax for the oil producing companies."

The 2001 federal budget may need more tax revenue than expected: It assumed help from the IMF and from the Paris Club of Russia's nation-creditors would give Moscow a break next year. That now seems less likely.

Then again, the 2001 budget is also conservative in its estimates of the world price, which continues to soar at $30 a barrel - making it unclear how much of a revenue shortfall to expect next year.

For now, the companies plead they already bring in a staggering 30 percent of the nation's budget revenues. And they argue all would be better served if they could use the windfall of $30-a-barrel oil to upgrade equipment and expand production.

"When foreign companies or banks give us a loan [the collateral for it] is a certain volume of oil," said TNK vice president Josef Bakaleinik at a news conference Thursday. "When they learn that the company may not live up to this volume [because it can't get export access], they feel like calling in their loans."

Oil analysts estimate the industry needs from $25 billion to $40 billion in investment over the next five years. Last year, companies put in a mere $3 billion - after being unable to invest much at all for almost a decade.

TITLE: Wall Street Ready for a Breather
AUTHOR: By Haitham Haddadin
PUBLISHER: Reuters
TEXT: NEW YORK - Wall Street eyes more holiday cheer this week even without a definite end to the battle for the White House, as investors snap up more high-tech stocks from the bargain basement.


The rally, however, may be short-lived because the same old ghosts haunting the market are still around the corner - Corporate America's worsening profits.

"We're looking at a Wall Street that has hopes for a Santa Claus rally, but not a lot of conviction about what kind of rally it may be," said Alan Ackerman, market strategist at brokerage Fahnestock & Co.

Standard & Poor's 500 Index futures rose 8.4 points to 1,355.2 on Sunday evening, while those for the NASDAQ 100 Index rose 55 to 2,884.

On Sunday evening, the state of Florida declared Republican George W. Bush the winner of its disputed presidential election vote. But Democrat Al Gore moved swiftly to contest the results and prevent Bush from becoming the next president of the United States.

Longer-term tech stocks could succumb to more selling, warns market tracker First Call/Thomson Financial.

Since early October, projections for tech profit growth dropped sharply to 16 percent from 29 percent for the fourth quarter, and to 16 percent from 28 percent for the first quarter of 2001.

"It's beginning to look a lot like a cyclical downturn in technology," First Call research director Chuck Hill said.

An end to the U.S. presidential election stalemate could send the NASDAQ Composite Index up more than 10 percent, Ackerman said, echoing sentiment among other market watchers who say that will peel away one thing the market hates most - uncertainty.

Others say the beaten-down market wants a breather for now, and even in the event that the battle for the presidency lingers, it may extend Friday's remarkable recovery.

"The market has swallowed all of that. It is really heavily oversold," said Henry Herrmann, chief investment officer at Waddell Reed Asset Management Co., which manages $26 billion.

Friday's advance, which saw the NASDAQ Composite Index rise 149.04 points, or 5.41 percent, to 2,904.38, came in an abbreviated post-Thanksgiving session. Investors snapped up high-tech shares that had carved out new lows for the year on Wednesday.

A handful of earnings reports may boost gains in the beaten-down tech sector. Among high-tech firms anticipated to beat estimates is Brocade Communications, the maker of switches and software for data storage networks.

The uncertainty around the U.S. Presidential election continued even though the Florida Canvassing Commission on Sunday certified Bush as the winner of the state's crucial presidential election vote over Democrat Al Gore.

A victory by the Texas governor - who is seen as the favorite candidate by some on Wall Street - is likely to boost the shares of tobacco, pharmaceutical and oil companies as he has promised to bring in less regulation to these industries.

A more moderate rally is expected if Gore is declared the victor. A win by the vice president is expected to boost shares of some bank stocks and mortgage market agencies because Gore is considered to favor retaining these enterprises in the current form.

But many experts remain wary of a sustained advance.

High interest rates, rising energy costs and the weak euro still threaten to take a bigger bite out of the profits of some of America's biggest companies, they said.

Investors may return to fretting because corporate confessionals from companies expecting to miss earnings or sales estimates for the current quarter, will start trickling in soon.

That's why Bill Meehan, senior market analyst at Cantor Fitzgerald, still advises his clients to sell on any election-related rally. A traditional year-end rally is unlikely because the U.S. Federal Reserve will not cut rates soon, he added.

TITLE: Upper House Balks At Tax Law Changes
AUTHOR: By Igor Semenenko
PUBLISHER: Staff Writer
TEXT: MOSCOW - The Federation Council showed its mettle, refusing to rubber stamp amendments to the second part of the Tax Code, postponing a vote until the end of December.


To come into force by the end of the year, the amendments would had to have been signed by President Vladimir Putin by Dec. 1, so the delay means that the nation will celebrate the New Year with loopholes in the Tax Code, the body of which became law in August.

The Finance Ministry submitted the legislation Friday to the upper house and asked members to approve it immediately. They refused, saying they needed time to study it.

"It was a very technical decision," said Olga Kizhayeva, spokeswoman for the Federation Council. "The item was not put on the agenda because the senators did not have time to consider the bill."

The chamber will meet sometime between Dec. 20 and Dec. 27 to discuss the issue, Kizhayeva said.

Although delay may create problems for the tax authorities, there is still time to get the amendments in for the bulk of 2001 tax collection, said Natalya Orlova, an economist with Alfa-Bank.

"Most taxes are charged on a quarterly basis and by the end of March everything will be in place," Orlova said.

The amendments are aimed at resolving contradictions left after approval of the code and to fill in some gaps.

The decision will impact the collection of value-added tax, social tax, excises and profit tax.

The major amendment would require municipalities to raise corporate income tax from 30 percent to 35 percent.

Under the new code, regions no longer receive a portion of value-added tax and lost other taxes. As compensation, the federal government allowed them to raise the corporate income tax, but not all regions took the opportunity.

"Some regions have imposed it, while others haven't," Deputy Finance Minister Sergei Shatalov said Friday, introducing the amendments bill. "This could poise risk for the [federal] budget."

Fearing that regional leaders would come to Moscow asking for cash, the federal government decided to require municipalities to raise the corporate income tax. The current 30 percent tax is split between the federal and regional governments; the additional 5 percent is to go entirely to the municipalities.

Some cities failed to enact the tax out of neglect, while others preferred not to overload local businesses with an additional tax burden.

Earlier this year, City Hall in Cherepovets argued that raising the tax would hurt steel maker Severstal, which is a major taxpayer in the town.

Other cities, such as Novgorod, said the tax only partially compensates for the losses incurred by the region and should be approved as soon as possible.

Novgorod estimates that the loss of a 1.5 percent housing tax deprives it of 290 million rubles ($10 million) in revenues next year. The increase in corporate income tax will bring in 181 million rubles, said Yelena Soldatova, head of the finance committee at Novgorod City Hall.

TITLE: MARKET WRAP
TEXT: Russian Markets Drop to Midsummer Index Levels 


Equities drifted down following the NASDAQ's dips and sank to their lowest level in five months.


"Risk is not wanted. It does not reward, you know," said James Fenkner, equity strategist with Troika Dialog. "Those who want to do bargain hunting do it in the Western markets."

The RTS index shed 7.4 percent to 167.36 - its lowest level since June 29 - seeing the NASDAQ plummet to its lowest level in 13 months to 2,755.34 in the middle of the week. The RTS is now 5.8 percent off the year's start.

At home, corporate-governance concerns continue to plague the market.

Norilsk Nickel's reorganization remains a black box, Surgutneftegaz is sitting tight on a cushion of cash without paying dividends and LUKoil refused to show that its books followed U.S. generally accepted accounting principles.

"These companies are just as risky as they were before," Fenkner said.

Unified Energy Systems sank below 10 cents a share on Thursday - its lowest level since the start of the year - and finished the week at 10.1 cents a share, down 13.7 percent, on fears that company managers will not pay much heed to minority shareholders in the restructuring process.

Rostelecom dropped 12.8 percent to $1.09 per share, reeling from poor corporate results and the NASDAQ's twists.

Oil stocks weathered the storm best after Brent prices in London topped $33 per barrel on expectations of a cold winter in the United States and growing tension in the Middle East.

Oil companies are gushing profits and are bound to increase dividend payouts this year, improving the outlook for preferred shares.

LUKoil was down 2.3 percent to $10.99, while Surgutneftegaz dropped 7.6 percent to 23 cents a share.

Preferreds were even better. LUKoil's were down only 1 percent to $9.95, while Tatneft's lost 0.9 percent to 23 cents a share.

Traders say the stock market is close to the bottom of the sea and cannot go anywhere but up from these levels.

"The end of the presidential saga in the States will bring in some relief," said Yevgeny Morozov, head of domestic sales with Renaissance Capital. "We think that the market may recover some of the lost ground on local buying."

TITLE: IN BRIEF
TEXT: Tobacco in Court

NEW YORK (AP) - A lawsuit filed with little fanfare three years ago in Brooklyn has emerged as the latest flash point in the high-stakes legal battle between the tobacco industry and opponents who claim it conspired to conceal the dangers of smoking.

On Monday, attorneys will converge in a Brooklyn courtroom to begin picking jurors for a two-month trial pitting a trust fund for sick asbestos workers against R.J. Reynolds, Brown & Williamson and other tobacco giants.

Attorneys for the plaintiffs say damages could exceed $3 billion.

The trial is the first out of a backlog of about a dozen tobacco claims in federal court in Brooklyn, some filed under civil provisions of the Racketeer-Influenced and Corrupt Organizations Act. Unlike class-action suits filed by consumers, most of the Brooklyn cases were brought by third parties, including health insurance groups who want "Big Tobacco" to share the cost of treating patients with cigarette-related illnesses. 



More Chrysler Losses

FRANKFURT (Reuters) - DaimlerChrysler AG's ailing U.S. Chrysler division might post a 2000 operating profit even lower than current expectations, the transatlantic auto group's chief executive told Der Spiegel magazine on Saturday.

"Originally Chrysler was supposed to make a $3.79 billion profit in 2000. In July the expectation was reduced to about $3.03 billion. In October to about $2.11 billion. And now we're talking about less than 2 billion," Jurgen Schrempp was quoted as saying.

"And I fear we haven't yet seen the end," he said, adding that Chrysler's unit sales sank 9 percent in October and that the situation did not look better in November.

DaimlerChrysler officials were not immediately available for comment on Saturday.

Chrysler lost about $487 million in the third quarter. Analysts expect further losses in the fourth quarter and the group has said it is unclear when Chrysler will return to profit.



South Korean Rally

SEOUL, South Korea (AP) - Two major South Korean labor groups rallied about 15,000 workers in central Seoul on Sunday to protest government-led corporate restructuring they fear will lead to mass layoffs.

It was the first such joint rally in three years for the Federation of Korean Trade Unions and the militant Korean Confederation of Trade Unions. The two have a combined membership of 1.8 million.

The protesters, many carrying signs or wearing red headbands and vests with slogans such as "Fight" and "Solidarity" printed on them, chanted and pumped their fists in the air.

"If we will be driven out to the streets just for working hard, let's not work. Let's strike!" said Kim Yon-hwan, head of an umbrella group for state utility labor unions.

The workers marched from Seoul train station to a cathedral a few kilometers away, clogging up traffic. They dispersed peacefully after the 2 1/2-hour-long rally.

Thousands of uniformed police officers, some with shields, stood around the protesters to guard against possible violence, but there was no report of clashes.

The protest was partly in support of workers at Korea Electric Power Corp., a state-run power company which the government plans to break into several units and sell.

TITLE: EU Ministers Hope Euro Will Rebound
AUTHOR: By Paul Geitner
PUBLISHER: The Associated Press
TEXT: BRUSSELS, Belgium - European finance ministers on Sunday predicted a rebound for their anemic currency, saying solid economic performance made a jump of as much as 20 percent possible.


France's Laurent Fabius spoke of "a feeling of confidence," after a meeting of ministers from the 11 countries using the euro, noting that forecasts show falling unemployment and sustained growth of 3 percent in 2001 and 2002.

"We are in the best economic situation we've been in for the past 10 years," said European Union Economic and Monetary Affairs Commissioner Pedro Solbes.

While it "takes time" for financial markets to recognize this, once they do, there is "a vast possibility" for the euro to rise against the dollar, Fabius said. Currently stuck around 84 cents to the dollar, the embattled euro has lost almost 30 percent of its value since its Jan. 1, 1999, launch, embarrassing European leaders who had predicted it would challenge the dollar's primacy in world markets.

European officials and economists have blamed Europe's relatively weak performance compared with the powerful U.S. economy for the slide. But recent forecasts predict that the growth rates will converge over the next couple of years as the U.S. economy cools off.

Fabius acknowledged several risks to the rosy picture in Europe, but said all of them come from outside the EU, such as high oil prices or volatility in the U.S. stock market or Japan.

Fabius declined to comment on recent criticism of European Central Bank president Wim Duisenberg, who briefed the ministers on the economic and exchange rate situation.

Duisenberg, under fire for being too loose-lipped on bank policy, left without talking to reporters.

Ministers from EU countries not part of the euro zone joined the group late Sunday to try to break a deadlock on how to tax savings deposited by EU citizens outside their home country.

A complicated framework was drafted in Portugal last June, but governments still disagree on major points, including the rate of withholding tax and how the revenue should be divided.

Tiny Luxembourg is especially loathe to tighten the relaxed banking rules that have made it a mecca for wealthy depositors, to the annoyance of tax collectors in Germany and other big neighbors.

Because the package must be adopted unanimously, EU diplomats said last week that a decision may not be reached by the time the meeting ends Monday, but be put off instead until EU leaders hold their summit in Nice, France, in two weeks.

TITLE: Controversial Speech Links Sex to Race
AUTHOR: By Michelle Locke
PUBLISHER: The Associated Press
TEXT: BERKELEY, California - A Nobel laureate's speech on sunshine and sex - complete with slides of bikini-clad women - left some at the University of California, Berkeley, aghast.


James Watson, who co-discovered DNA, dumbfounded many at a guest lecture when he advanced his theory about a link between skin color and sex drive.

"That's why you have Latin lovers," he said, according to people who were there last month. "You've never heard of an English lover. Only an English patient."

"I realized right away that this was inappropriate," said Susan Marqusee, an associate professor of biochemistry and molecular biology.

Watson also said fat people are happy and thin people more ambitious, showing a slide of waif-like model Kate Moss looking sad to illustrate the point.

Marqusee said she walked out after a comment about men finding fat women sexually attractive. "There wasn't any science," she said. "These aren't issues that one can state as fact."

Watson has been traveling and does not comment on reaction to his lectures, said Jeff Picarello, spokesman for the Cold Springs Harbor Laboratory, where Watson is president.

Picarello said Watson has gotten positive reviews on the lecture before and is known for his sense of humor. Expounding on his theory that exposure to sunlight enhances sex drive, the mostly bald 72-year-old will announce that bald men have better sex, Picarello said. "He says this with a twinkle in his eye. It's fascinating, but at the same time it's amusing."

Biology doctoral candidate Sarah Tegen said people were laughing at the lecture's start. But the laughter turned nervous as the theme was developed.

"There was a lot of looking at the person next to you and saying, 'I can't believe he's saying this,'" she said.

The problem, says Tegen, was that Watson didn't present the science to back up his startling presentation.

"I think there's a really important place in science for controversy. That's how you overturn dogmas. But it's got to be within a context of testable hypotheses," she said.

Watson, who shared a Nobel Prize for his role in discovering the structure of DNA in 1953 and who launched the Human Genome Project in 1990, was giving a speech called, "The Pursuit of Happiness: Lessons from pom-C."

Pom-C is a protein that helps create different hormones - melanin that determines skin color, beta endorphins that affect mood and leptin, which plays a role in metabolizing fat. Watson talked about how the chemicals are enhanced by sunlight, leading to the supposition that people who are exposed to more sunlight have more of the hormones.

He talked about an experiment at the University of Arizona where male patients were injected with a melanin extract. The test was designed to see if skin could be chemically darkened to prevent skin cancer, but found that as a side effect the men became sexually aroused.

Watson went on to talk about how exposure to sun may affect sexual drive, showing slides of women in bikinis and one of veiled Muslim women.

James Allison, co-chair of the university's department of molecular and cell biology, called the speech fallout a "tempest in a teapot," adding, "Jim's a provocative guy. He certainly provoked people."

But some Watson supporters were concerned he went too far.

"Doesn't a guy like Jim Watson have the responsibility to make this not ugly?" Berkeley biologist Michael Botchan, a Watson protege who presided over the session, told The San Francisco Chronicle. "Yes. But I cannot tell Jim Watson to change his ways."

TITLE: Scientists Debate Likelihood That Fossil Is an Earlier Bird
AUTHOR: By Rick Callahan
PUBLISHER: The Associated Press
TEXT: Feathers or scales? Scientists analyzing a 220-million-year-old reptile fossil can't agree on what they're looking at.


Earlier this year, researchers suggested that a small reptile known as Longisquama was studded with long feathers that let it fly, or at least glide. This view would push back the ancestry of modern birds by 75 million years.

Now, a rival scientific team from Canada reports that the notion of an airborne Longisquama is too flighty.

What appear to be feathers poking from the reptile's spine actually are long, thick scales that left cup-like impressions in surrounding rock, the Canadians conclude in the current issue of Nature.

Hardly dainty, they said the body-armor scales may have attracted mates or frightened predators.

"Feathers are extremely paper-thin structures, but these have some depth to them, a real substantial three-dimensional nature. It's completely unlike bird feathers," said zoologist Hans-Dieter Sues of the University of Toronto.

He and co-author Robert R. Reisz argue that the fine details do not support the feather interpretation.

A quill-like structure is only a furrow running the length of the scale, he said. And, the feathery barbs running perpendicular to the "quill" really do form a corrugated pattern on the scale.

Feather advocates dismissed the Canadians' scale interpretation as "total nonsense."

Oregon State paleontologist John Ruben, who co-authored the Longisquama study, said the Canadians based their conclusion on the worst-preserved of all the Longisquama fossils - one clogged with petrified sediment.

The best fossils, he said, show the creature's long appendages possess a concave-convex structure consistent with the bowed appearance of modern feathers.

Longisquama was discovered in Central Asia in 1969. It is thought to be an archosaur, a member of a reptile group that later gave rise to dinosaurs, crocodiles and birds.

If Ruben's analysis is correct, it challenges the premise that birds arose from small, meat-eating dinosaurs. The earliest known bird, Archaeopteryx, appeared about 145 million years ago - some 75 million years after Longisquama.

Alan Feduccia, an evolutionary biologist at the University of North Carolina, Chapel Hill, believes the appendages on Longisquama may have been a transitional structure between scales and feathers.

"Since we know that scales and feathers are closely related, it makes sense that we would eventually find something like this," Feduccia said.

TITLE: Hubris, Real Estate and the Fall of a Ukranian Prime Minister
TEXT: Pavlo Lazarenko reportedly stole millions from Ukraine's state coffers, but a fondness for fine Californian real estate may have proved to be his undoing. Nathan Hodge reports. 


PAVLO Lazarenko might never have made headlines had he not had a weak spot for flash property. The former Ukrainian prime minister and presidential candidate skipped his native country in February 1999, fleeing an embezzlement charge.


His colleagues in parliament - where he headed the Hromada faction - had demolished his presidential hopes by voting that same February to strip him of his immunity from prosecution, a privilege given all Ukrainian parliamentary deputies. And they gave a major boost to incumbent President Leonid Kuchma, who had sought at all costs to keep Lazarenko and his money out of the running.

After a brief stay in Greece (to recuperate from a stress-induced heart attack, he said), Lazarenko landed in the United States, where he sought political asylum. It was a shrewd move, as it spared him immediate extradition to Switzerland to face money-laundering charges. But U.S. newspapers were little interested in the asset-stripping schemes that reportedly netted La za ren ko hundreds of millions of dollars. That was just more evidence of staggering corruption in the former Soviet Union, by then an almost routine story.

No, reporters were more interested in the house. While Lazarenko fought extradition, his family sat out the proceeding in a swank Marin County, California, mansion. A brochure for the property - which boasted five swimming pools, nine bathrooms, two helicopter pads and a 189-square-meter master bedroom - made it into the hands of reporters. Better yet, there was a celebrity connection. The estate, bought for nearly $7 million in cash, had reportedly been Eddie Murphy's home.

But Lazarenko's bid for a luxurious exile hinged on convincing the U.S. authorities that he would face serious political persecution should he be deported to Ukraine. And he, as a one-time presidential contender in his own country, understood that, with an election year on in the United States, it is easy to find friends.



Presidential Politics


What ensued was a curious footnote to the 2000 presidential elections. Republicans, eager to tar Vice President Al Gore with complicity in - or at least willful ignorance of - post-Soviet corruption, said the administration of President Bill Clinton had turned a blind eye to the rapacity of their counterparts in Russia and Ukraine.


Republican presidential contender George W. Bush played precisely that card during the presidential debates, when he alleged that money from International Monetary Fund loans "ended up in [former Prime Minister] Viktor Chernomyrdin's pockets."

Bush was wrong - in fact if not in substance. Chernomyrdin was never charged with laundering IMF funds, but IMF money certainly helped subsidize massive capital exodus by Russia's oligarchs, a class to which Chernomyrdin belonged.

The Republicans rightly smelled blood. And well before the debates began, Lazarenko was happy to oblige them on the corruption issue.

From his cell in California, Lazarenko came forward with the allegation that Ukraine - much like Russia - had mishandled its hard-currency reserves in violation of arrangements with the IMF. According to Lazarenko, $613 million in IMF funds were diverted from the Ukrainian Central Bank in December 1997 and invested through offshore subsidiaries into speculative government bonds, reaping interest rates of up to 66 percent.

The Financial Times broke the story in January. Rumors had circulated for months about the possibility that former Ukrainian Central Bank head and current Prime Minister Viktor Yushchenko - who enjoyed the wide approbation of Western advisers - had been involved. A parliamentary investigation of the matter, however, remained sealed in Kiev.

Enter Lazarenko. After he aired the allegations, the Financial Times reported that Republican Congressmen Dan Burton of Indiana and Curt Weldon of Pennsylvania had discussed the possibility of Lazarenko's testimony before the U.S. Congress.

Lazarenko never took the witness chair on Capitol Hill. But the scandal shook what little confidence remained in Ukraine. And it caused the country more than embarrassment: the IMF declined to resume lending, a heavy blow to the state's finances.

Lazarenko had fronted the information in what looked to be an attempt to shore up his bid to stay in the States. But did he aid his cause? He had, after all, implicated himself in a massive scam: the misallocation of the IMF money took place on his watch.

It seems to have been a calculated risk. Lazarenko was gambling that he could make a case that the Kuchma administration had it in for him if he returned to Ukraine. In Lazarenko's words, he faced "physical extermination" if he went back.

He had a point. Lazarenko had indeed contributed mightily to Ukraine's parlous state. But it also could not have happened without complicity at the top. Leonid Kuchma - who appointed him prime minister - had a strong interest in shutting him up.

Shortly before he made his first appearance before a U.S. court over his extradition, the newsroom of the Kyiv Post - where I worked at the time as a reporter - received a letter from one of Lazarenko's lawyers. It offered an all-expense-paid jaunt to San Francisco to testify that Lazarenko would be tortured in jail should he return. No one took the offer. But the persecution defense was not without merit. When I told a Ukrainian friend about the letter, she said, "They should have sent me. I'd tell them that I'd throttle him myself."

If U.S. prosecutors were to look closely at the parliamentary proceeding that sped his exit from Ukraine, they would have noticed that he faced a - relatively - piddling charge. Prior to the parliamentary vote, Ukraine's prosecutor general had accused him of embezzling 5 million hryvnya ($2.7 million at the time) from state coffers to fix up his dacha outside Kiev.

This is all just par for the course as far as Ukrainian officialdom goes. Misdirecting state funds is the rule, rather than the exception, in Ukraine, and when it comes to dacha repair, it is still not uncommon to see army conscripts bartered off as cheap construction labor for local bigwigs.

The embezzlement charge had a more level motive: It allowed Kuchma to eliminate a troublesome rival for the presidency without airing troublesome details about the corruption that pervaded his administration.

And it was Lazarenko's lavish tastes that tripped him up. Had he not had such strong competition in the home-redecorating category, things might have happened differently.



A 'Repat' Returns


I met Bohdan Mysko in 1999. The Aspen-based oil millionaire had come back to his ancestral land to dole out advice and aid, chiefly as an adviser to former President Leonid Kravchuk.


The phenomenon of the "repat" - first-or second-generation emigrants who have flocked to the former Soviet bloc in search of fame, fortune or political influence - is worthy of a separate discussion. Some, such as Vaira Vike-Freiberga, the current president of Latvia, met with success. Most, however, found that they barely shared a mother tongue; many went home with their bank accounts considerably lightened.

Word had it in the Ukrainian diaspora that Mysko also planned to go great guns as an investor. Mysko denied that he had any business interests in Ukraine, but he had made one major investment: refurbishing a mansion that once belonged to Ukrainian party boss Volodymyr Shcherbytsky.

Mysko envisioned the place as a sort of clubhouse for Ukraine's ruling clique. The place would be "like Camp David," he told me. A comparison with Hugh Heffner's Playboy mansion would have been more appropriate.

The place had a lavish rococo interior, richly embellished with expensive smut. Brass nymphs were splayed atop the balustrade. By the door, Mysko had a gun case with beautifully engraved side-by-side shotguns. A surround-sound cinema with reclining seats in the den. And the estate's bunker - which once was supposed to shield Ukraine's party faithful from NATO bombs - had been turned into a wine cellar. With a huge brass penis for a door handle.

It also had a humble touch. Mysko, an up-by-the-bootstraps sort, had made his fortune in the South American oil business. But he never forgot his Galician roots: The garden had a model thatched-roof cottage, an idealized take on the home that Mysko fled during the war.

But Mysko had a problem. He had done a bang-up job on the estate, for sure, but now some of the Ukrainian compradors had cast an envious eye on the place - Lazarenko included.

Problem was, no one had clear title on the place. Mysko may have refurbished the building, but the land beneath was a different question. Land ownership has yet to be solidly established in Ukraine; Mysko may have paid for the place, but it could be confiscated on a whim.

Later on, Mysko showed me a before-and-after video of the refurbishment job. I was treated to a video tour of the house, narrated by Houston interior decorator William Stubbs. You could hear him frown as he sized up the Shcherbytskys' sorry bathroom fixtures. "That, I think, is supposed to be a shower," he said, framing a disapproving shot of a utilitarian showerhead that hung over a drainage floor.

Mysko chimed in with his own narration. "Fucking commies," he hooted. "Look at that, no taste at all."

It was true. Shcherbytsky may have once been the most powerful man in Ukraine, but he inhabited a tatty old place. The billiard table was shredded, the furniture was Soviet-modular, and the place had a distinctly down-at-heel look.

Mysko was proud. The place had landed a spot in Architectural Digest - doubtless the first place in Ukraine to receive the honor. "They'd visit this place and they couldn't believe their eyes," - they presumably, meaning the government big shots he had hosted at the place. "They could never do it like this, you know why?"

I shrugged no.

"Because they got no fucking taste."

At least one man had tried to keep up with Mysko: Pavlo Lazarenko. Lazarenko had for a time, occupied a neighboring plot. According to Mysko, Lazarenko got the idea for the lavish landscaping job from him.

Pointing to a sculpted pond - next to a bocce ball court - Mysko said that Lazarenko had tried to outdo him with his own landscaping job. That refurbishment would figure in the prosecutor's charges.



Millions over Marin


So real estate envy, it seems, may have played a role in Lazarenko's downfall in Ukraine. But once in exile, why should he take more risk? After all, a $7 million mansion in California is no place to lie low. Lazarenko's putative wealth was supposed to have reached upward of a billion; he had the cash at his disposal to retire where journalists or prosecutors might not ask so many prying questions about the sources of his wealth.


Lazarenko's motives can only be guessed at. But what seems clear is that such chutzpah is in his character. In late 1998, after returning from arrest in Switzerland - he had been carrying a Panamanian passport and was detained on a money-laundering charge - he made a triumphant return to Ukraine. Rather quixotically, he vowed to pursue his campaign for president.

For someone whose domestic political reputation was forever tarnished, he seemed to have returned to the scene with confidence. The only giveaway was a slight tic: Lazarenko blinked furiously, especially when forcing a telegenic smile.

At a packed press conference, he protested his innocence, allowing only that "Lazarenko is no angel."

But he still held parliamentary immunity from prosecution at the time. Worse still for the administration of President Kuchma, he had promised to name names of corrupt officials. But Lazarenko never came forward - at least not in Ukraine.

The Kuchma administration, which was readying for a fall 1999 election campaign, did not want details about corruption leaked to the press that might implicate members of the presidential entourage - or the president himself.

After all, the Ukrainian administration had to keep a lid on a similar scandal, involving Oleksandr Volkov, one of the president's closest advisers. A Belgian judge in 1997 froze $3 million of Volkov's money on suspicion of money laundering, but Volkov never faced legal repercussions in Ukraine. In fact, Belgian investigators complained of "very high level" obstruction as they pursued their case.

And Lazarenko and Kuchma went way back. They both came from the eastern industrial center of Dnipropetrovsk, graduating from the same ranks of Communist Party functionaries. In fact, the country's ruling clique came to be known as the "Dnipropetrovsk clan." And many Ukrainians privately believed that the Kuchma-Lazarenko feud was really a dispute among thieves.

The property abuse charge allowed Kuchma's prosecutors to turn public opinion - and the parliament - against Lazarenko. And in an election year, it ensured that not too many details would tarnish the president. Meanwhile, the Swiss were busy preparing a case against Lazarenko at the urging of the Ukrainian government, which bombarded Swiss federal prosecutors with incriminating materials.

In June, a Swiss court convicted Lazarenko in absentia of money laundering, giving him an 18-month suspended sentence and confiscating nearly $6.6 million from his Swiss bank accounts.

Meanwhile, in the United States, Lazarenko faces up to 20 years for conspiracy and money laundering and 10 years for individual cases of illegal property transfer. A San Francisco federal court has rescheduled a hearing on the Lazarenko case for Nov. 28.

TITLE: Aluminum Giant, Gaz in Auto Deal
AUTHOR: By Maria Rozhkova and Vladislav Maximov
PUBLISHER: Vedomosti
TEXT: MOSCOW - A deal appears to have been struck between Oleg Deripaska, head of metals giant Siberian Aluminum, and Nikolai Pugin, head of the nation's No. 2 automaker, GAZ, that could clear the way for the former to put its representatives on the Nizhny Novgorod-based auto plant's board.


Siberian Aluminum, which refused to comment officially on its activities regarding GAZ before a meeting in Moscow on Wednesday between the two directors, has been busy buying up shares in GAZ through its affiliated structures and has acquired more than 25 percent of the factory's shareholding.

On Wednesday evening the group's press service released their first brief commentary on the course of negotiations with Pugin - namely that they are going well and should be wrapped up in a week's time. Pugin and Deripaska first came to the negotiating table last Thursday in Nizhny Novgorod.

Earlier GAZ had refused to acknowledge Siberian Aluminum as a shareholder in the company and analysts had predicted the management would resist any change in authority at the plant. It was even suggested that the factory's president could form an alliance with the Alfa Group holding, which has been openly buying up shares in the enterprise.

But if Pugin had once given the impression he was ready to fight it out with GAZ, then he seems to have re-evaluated the situation.

A source close to the negotiations said Pugin acknowledged Siberian Aluminum was the largest shareholder in GAZ and should therefore play a role in the management of the factory.

An agreement is to be drawn up on the basis of the negotiations, as is the mechanism for including Siberian Aluminum's representatives on the board of directors, the source said.

Though the source said Pugin would keep his post, Interfax reported Thursday that a Siberian Aluminum spokes man refused to comment on whether the company would propose their own candidate for the post at a board meeting planned for next Wednesday.

Siberian Aluminum will reveal the extent of their stake and plans for the factory at the meeting, the representative said.

Pugin's adviser Gennady Suvorov said "the issue of changing the management was discussed," at the negotiations.

TITLE: MARKET MATTERS
TEXT: Meetings and Raids Sideline City's Bankers 


THE St. Petersburg banking sector remained the focus of attention last week, when investigators passed on from their raid of Promstroibank to pay a visit to another other local organization, Baltiisky Bank. Concerning the latter, the raid was initiated by investigators from Belgorod, who were apparently tracing several companies from that town who are suspected of tax fraud. 


Since then, both myself and various colleagues have started to look for something that would link the searches of two banks in the space of a week. But I have not come up with anything, and I don't think I am alone in this respect. Two different sets of prosecutors, two different banks, not much connection.

The only similarity is that both cases concern financial institutions which are very vulnerable. And both searches were apparently designed to cause the maximum amount of fuss and draw as much attention as possible, and both are potentially damaging to the banks' reputations.

The raids have certainly fully occupied the minds of analysts, the media and city officials. However, most of them have offered nothing more enlightening than hints that strong but mysterious powers are lurking somewhere behind the commotion.

The shortest and most lucid comment I heard last week came from Lyubov Sovershayeva, deputy to the governor general of the Northwest region, Viktor Cherkesov. When asked about what possible reasons there might have been for the searches, Sovershayeva responded by saying: "Why ask me? My field is economic and financial - you need to ask those with political responsibilities."

What was interesting, though, was not the comment itself - even considering who it came from - but the circumstances in which it was made. It was Friday evening, shortly after Sovershayeva had left a round-table meeting between Cherkesov and the top managers of the region's most important enterprises. (Ever since President Vladimir Putin met the oligarchs in July, it seems to have become fashionable for important officials to sit down with businessmen and discuss economic issues.) Cherkesov had already announced his intention of creating a board of business experts in the summer, and this was a step in that direction.

When businesses and politicians huddle together, businessmen are looking for a greater say in how laws that affect them are framed, and, in this case, they will be hoping to shift responsibilities for things like licenses and quotas from the center to the Northwest. According to Sovershayeva, the board - which will start work in December - will have only an advisory function - but it is clear to all that its members will be able to lobby for their interests on a very high level, given the power that the seven governors general have been given by the president. Life, at least in the economic sphere, will get more interesting.

But note: no banks were invited. Directors of the big industries and producers were there, but officials explained that, although delegates were drawn from the region's top 100 tax payers, exceptions were made for those experiencing difficulty with law enforcement organs. What was that again about the raids and strong and mysterious forces ...?


Anna Shcherbakova is chief of the St. Petersburg bureau of Vedomosti.

TITLE: Global eye
TEXT: Coup, Clucks Clan


With their attempt to disenfranchise tens of thousands of black and Jewish voters temporarily sidetracked by the Florida Supreme Court this week, the bristling Bush clan began pumping the sludge in an effort to utterly destroy the ability of Al Gore to govern should he win the U.S. presidency.


Like many other notable American families - the Gambino Family, the Corleone Family, the Manson Family, etc. - the Bushes stop at nothing to defend what is theirs, i.e., whatever it is they happen to want. In their furious tantrum at not simply being rewarded the presidency outright just because of a few decrepit Hebrews and some cantankerous darkies, they have not blanched at the great uncrossable line of American politics: a military coup.

This week they trotted out one of the family retainers: "Stormin'" Norman Schwarzkopf, the "victorious" field general of the Gulf War, who triumphantly mowed down surrendering Iraqi conscripts while mysteriously allowing Saddam Hussein's crack Revolutionary Guard to escape untouched. Norman, a conspicuous platform presence during the campaign, was back in action as the overseas absentee ballots came in.

Outraged that Democratic observers challenged the veracity of a few military absentee ballots (not all of them Bush ballots), Norman essentially called on the troops to rise up against Gore. Stormy said military personnel were being "denied the right to vote for the president of the United States who will be their commander in chief," while "other ballots have been counted twice and are now being counted a third time." (Except, of course, that the disputed votes have not actually been counted at all; that's why they are disputed.)

The general's insurrectionary remarks were echoed by Bush point man Marc Racicot, who is ostensibly the governor of Nebraska but now seems to spend his days haranguing crowds in Florida. Racicot said that Gore has "gone to war against the men and women who serve in our armed forces."

It was all part of a pattern. A gaggle of top Republicans then began singing in chorus about a "stolen election," "manufacturing votes" and the "illegitimacy" of a Gore administration. But while the public whining went on, behind the scenes the Clan was laying the groundwork for more serious shenanigans.

Even as we speak, the Republican-controlled Florida state legislature is drawing up plans to throw out the Gore electors, if he wins the recount, and send a whole new slate of Bush babies. And if that doesn't work, the true power in the Republican Party - hard-right hatchet man Tom DeLay, congressman from Texas - has already prepped the Republican-controlled House of Representatives to refuse any Gore electors from Florida and choose a Bush slate instead.

So the fix is in, despite Gore's 50 million votes and 300,000-vote lead in the national count (a lead which The New York Times continues to call "tiny," although it is three times the victory margin of John Kennedy). True, there's lots of court action and heaps of mud yet to come, but on Inauguration Day, look to see the smirking visage of the second-place, unelected, engineered, mud-caked, military-backed George W. Bush, staring out vacantly at the world as the new president of the United States.



Brand New Day 


When a nascent religious faith becomes the dominant force in a civilization, it displays the scope and power of its dominion through the building of magnificent edifices - grand mosques, towering cathedrals and vast glittering temples. These sacred structures house the wonderworking symbols of the triumphant creed, and serve as vehicles for the believers' communal experience of divine transcendence.


And so it is today, in the lands of the civilized, globalized West, where powerful prelates are busily erecting huge cathedrals to convey the glorious communion offered by the divinities of the New Millennium:

Corporations.

Yes, "corporate cathedrals" are all the rage, reports the Financial Times, as major companies rush to create "an environment around their brand:" theme parks, restaurants, clubs and recreational complexes that sell not the product but the "brand experience."

The carmaker Renault and the boozepumper Guinness have recently launched their own massive marketing structures, joining such exalted companies as the $30 million Coca-Cola World, the $15 million Cadbury World Fantasy Factory and the 10-hectare, $400 million Autostadt fun park of Volkswagen.

Renault's Atelier restaurant, bar and exhibition hall opened on the Champs-Elysees last week. They're not selling cars there, you understand; they are "repositioning the brand." The building "is about feeling Renault," says Atelier director Thierry Tuteleers. "It's the perfume of the new brand values." And what exactly are you supposed to smell when you walk in? Why, Renault's new "corporate definition" as "caring, daring and innovative," of course.

Guinness, meanwhile, will open its "Storehouse" in Dublin this December, offering a "tribal hub for young people," including a club and glass-walled bar. Marketing whiz Ralph Ardill says Guinness and the other corporate deities are now looking for "emotional dialogue" with consumers, employing "metaphors for the company philosophy" without using something so vulgar as the actual product.

Guinness, for example, has based its "global home" around the values of "power, goodness and communion." (And you thought Guinness was just something to make you belch, stumble and talk funny. O ye of little faith!) This will be conveyed with a giant indoor waterfall and the subtle play of ruby lights on the building's glass exterior at night.

Of course, while the corporations are serving up all this power, goodness and daring caring, they will also be carrying out "quantitative and qualitative" market research on the worshippers who bow at their altars, marketers said: how many ruby-lit gambolers in the Guinness waterfall actually go out and buy the stuff, for example. If those numbers fall too low, the "emotional dialogue" and "communion of goodness" will be recalibrated accordingly. (Mauve lights, perhaps, or a water slide instead. Whatever.)

Reports that the unelected president-elect plans to convert the White House into a "brand experience" called "Bushopolis" - "built around the fragrant values of feeling, healing and obfuscation" - could not be confirmed.

TITLE: EDITORIAL
TEXT: Chechnya: Time To Say Enough 


IF the world needed yet another reminder of the scope of horror and suffering being inflicted daily in Chechnya, it received one Wednesday in the form of "Chechnya, the Politics of Terror," a report by the Nobel Prize-winning group Me decins Sans Frontieres.


"Despite the illusion of normalization upheld by the Russian authorities and the resignation of the international community," the stark report says, "the violence against civilians is ongoing." MSF says the war has resulted in about 300,000 displaced persons who are now entering their second winter "in appalling conditions."

MSF's report comes less than a month after the appearance of a Human Rights Watch book, "Welcome to Hell," which documents cases of torture and bribe-taking by Russian military authorities at detention camps in Chechnya.

Both reports argue that a reign of terror the Russian military has established throughout the republic is the main barrier preventing refugees from returning to their homes.

And both reports criticize the international community - especially the Council of Europe, the United Nations and the Organization for Security and Cooperation in Europe - for doing so little to confront the Kremlin. 

In addition, a Chechen administration report has come out condemning the Russian military for "looting" the republic. That report estimates that more than $2 billion in damage has been done to the Chechen energy sector in the last year.

While the Russian army is richly profiting from the reign of terror described in the MSF report, the European Union has announced it will provide an additional $4.8 million in food assistance to refugees who want to return home but cannot.

And British Prime Minister Tony Blair - President Vladimir Putin's closest friend - won an election in 1997 with promises of an "ethical foreign policy." So the world was treated to the unedifying spectacle of Blair drinking beer with the Russian leader, who said in a meeting this week with leading generals that "the anti-terrorist operation must be followed through to the end."

From this and many other statements, it is obvious the Kremlin has no plan for Chechnya other than continued warfare and official terror. The Russian public, which has no access to the truth about Chechnya and little influence with the authorities in any case, is in no position to demand an accounting. 

Only the international community can. But it seems to have a strange idea of what is "ethical."

TITLE: An Inadequate Obituary for A Heroic American Writer
AUTHOR: By Paul Dunn
TEXT: A SMALL Associated Press obituary caught my eye a couple of weeks ago. Its headline read: "Lardner; writer, age 85." How terse and how inadequate.


Ring Lardner Jr. was the writer-humorist son of the equally famous humorist and baseball writer. He died on Nov. 1, where he'd lived most of his life, in New York City. He hung on long enough (85 years) to have a copy of his most recent book handed to him, just 11 days before his death. The book's title spoke volumes - "I'd Hate Myself in the Morning."

To today's younger generation, Ring Lardner Jr. is a mere footnote in an American history text, if that. The dramatic role he was fated to play in our national chronicles was not of his choosing. But he played it to the hilt.

Lardner enrolled at Princeton, but dropped out after two years and headed for the golden glow of Hollywood, arriving in 1935. It was the peak of the Great Depression. He soon won accolades for his work on "A Star Is Born" and an Academy Award for the humorous 1942 box office hit "Woman of the Year."

It was after the war that fate intervened. He ran head-on into a nasty little guy named J. Parnell Thomas. Elected to Congress in the 1930s, he held extreme right-wing views and claimed that Roosevelt's New Deal had "sabotaged the capitalist system." He led the attack on the Federal Theater and Writers Projects, claiming every play under the auspices of the project was "sheer propaganda for communism or the New Deal."

In 1947, the Republican-controlled Congress named him chairman of the notorious House Un-American Activities Committee. He was also a crook who ultimately went to prison for billing the U.S. Treasury for wages of employees who didn't exist and paying the money into his own bank account.

The hearings began with "friendly" Hollywood witnesses like Robert Taylor, Gary Cooper and John Wayne protesting their loyalty and calling for the removal of all in movieland who were found to be "un-American."

Then, at the very height of the anti-communist witch hunts in America, Thomas called Lardner to testify. Many Hollywood figures had been socialists and communists before and during the war. Lardner had been a lukewarm communist and felt that as a loyal American he had not only every right to be one, but that he should be able to hold any belief he wanted. He also felt that what he believed was his business and no one else's.

Right-wing zealots, who were determined to root out commie evildoers at any cost, coerced motion picture studio heads, TV program creators and advertisers. The cost was that innocent citizens could not find work. Many experienced financial ruin and despair and a few even resorted to suicide. One Screen Actor's Guild leader informed on his co-workers to the FBI for years, telling J. Edgar Hoover's minions which Guild members he suspected were communists. He was officially known as "Informant T-10." He went on to become President Ronald Reagan.

The Cold War was taking its toll on America, and an ugly toll it was. It inspired Arthur Miller to write his masterpiece, "The Crucible," seemingly about the witch hunts of old Salem but really about what was going on in Washington.

When Lardner was called, he was asked the familiar question: "Are you or have you ever been a member of the Communist Party?" by Thomas. Lardner's reply was riveting: "I could answer that the way you want, but I'd hate myself in the morning."

Lardner believed it wrong, even unpatriotic, to confess private political beliefs to anyone, particularly to a red-bating, self-righteous Congress. Ironically, although he'd been a communist, he'd long before left the party and loudly acknowledged its shortcomings and serious failures. But when it came to naming names, Lardner stood firm.

His stance cost him dearly. He lost his job. He was blacklisted for years in movies and television. He was sentenced to a year in prison for contempt, served 10 months and was unable to work in movies or television under his own name for 15 long years. Ironically, when he served his jail time, one of his fellow prisoners at Danbury was J. Parnell Thomas. I imagine that today's civics teachers never even mention the names of Albert Maltz, Dalton Trumbo, Samuel Ornitz, John Howard Lawson, Herbert Biberman, Robert Adrian Scott, Lester Cole, Alvah Bessie, Edward Dmytryk or Ring Lardner Jr. - the "Hollywood 10." Only one of whom, Dmytryk, in the end named names. The others stood fast and firm in their belief in the U.S. Constitution.

Afterward, to feed his wife and young children, Lardner was forced to write under pseudonyms, as did other members of the "Hollywood 10." He couldn't put his own name on a script until he did "The Cincinnati Kid" in the mid '60s.

In all, more than 500 motion-picture people were either gray-listed or blacklisted. It went on until a brave Kirk Douglas insisted that Dalton Trumbo be given screen credit for "Spartacus" and "Exodus."

In 1970, Lardner won another Oscar, for best screenplay, for the anti-war masterpiece "M*A*S*H." When he died, he was the last of the "Hollywood 10." When asked about his standup attitude in later years, Lardner would simply affirm: "I wasn't a hero. I was merely standing up for the First Amendment." 


Paul Dunn is a columnist for The Pilot of Southern Pines, North Carolina, for which he wrote this comment.

TITLE: San Diego Charged Up Following First Win
PUBLISHER: Reuters
TEXT: ST. LOUIS, Missouri - The New Orleans Saints sent a clear message Sunday that they are to be taken seriously by stunning the Super Bowl champion St. Louis Rams 31-24 behind a rookie backup quarterback to move into a tie for first place in the NFC West.


Despite missing star running back Ricky Williams and starting quarterback Jeff Blake and committing a club-record 17 penalties, Aaron Brooks threw one touchdown pass and ran for two more in his first career NFL start as the Saints improved to 8-4 to match the Rams' record.

"It feels great. It will definitely get the doubters thinking correctly," said Brooks, of the lack of respect the Saints traditionally receive.

Teammates were impressed by the calm under pressure shown by Brooks, whose one-yard touchdown run with 3:50 remaining snapped a 24-24 tie.

"He stayed under control," the Saints Joe Horn said. "He was calm and he kept us calm. You usually don't see a rookie quarterback smiling in the huddle."

St. Louis had momentum after coming back from 24-10 down to tie the game on Trent Green's 19-yard touchdown pass to Ricky Proehl 3:54 into the fourth quarter.

While the Saints hurt themselves with penalties, it was a 47-yard interference call on Rams defensive back Todd Lyght that proved pivotal. "I have to take responsibility for the penalty," Lyght said.

It gave New Orleans a first down at the St. Louis 11 and Brooks, who completed 17 of 29 passes for 190 yards, scored five plays later to give the Saints the lead for good.



San Diego 17, Kansas City 16. In San Diego, fans finally got to celebrate a victory and the Chargers ended fears of becoming the first team to complete a winless season since the 1976 Tampa Bay Buccaneers by edging the embarrassed Kansas City Chiefs 17-16.


Ryan Leaf tossed a pair of touchdown passes to Freddie Jones and John Carney kicked a 52-yard field goal with 2:14 left as the Chargers (1-11) overcame five turnovers as the reeling Chiefs (5-7) dropped their fourth in a row.



Philadelphia 23, Washington 20. In Washington, Philadelphia quarterback Donovan McNabb ran for 125 yards, including a 21-yard touchdown run in the third quarter, as the surprising Eagles kept their hold on first place in the NFC East with a 23-20 win over the Redskins.


McNabb also completed 19 of 30 passes for 137 yards with a three-yard touchdown pass to Jeff Thomason as the Eagles improved to 9-4.



New York Giants 31, Arizona 7. At Arizona, Kerry Collins passed for 232 yards and a touchdown and the New York Giants got touchdown runs from Tiki Barber, Ron Dayne and wide receiver Amani Toomer in a 31-7 romp over the Cardinals.




Miami 17, Indianapolis 14. In Indianapolis, Dolphins backup quarterback Damon Huard capped and 86-yard drive with a 17-yard touchdown pass to Oronde Gadsden with 70 seconds left as Miami maintained first place in the AFC East with a 17-14 victory over the Colts. The winning drive for Miami (9-3) began after Brock Marion intercepted Peyton Manning at the Miami 5. Indianapolis (7-5) tried desperately to tie the game but Manning failed to get his team into comfortable field goal range and Mike Vanderjagt's 59-yard attempt was blocked. 

(For more results see Scorecard.)

TITLE: Nashville Makes Easy Prey of Carolina With 4 Early Goals
PUBLISHER: Reuters
TEXT: RALEIGH, North Carolina - Randy Robitaille scored twice and Cliff Ronning had three assists in a four-goal first period as the Nashville Predators ended a 159-minute scoring drought with a 7-4 victory over the Carolina Hurricanes.


The Predators were coming off back-to-back shutout losses and had combined for just nine goals in their last seven contests. Nashville snapped a three-game losing streak and won for the first time in three road contests against Carolina.

After Josef Vasicek opened the scoring for Carolina 5:48 into the contest, Robitaille tallied a power-play goal to tie it with 9:02 left.

Robitaille, Scott Walker and Patric Kjellberg scored at even strength in the final five minutes of the period, giving Nashville a three-goal margin.

The Hurricanes peppered goaltender Tomas Vokoun with 20 shots in the second period and closed within 4-3 on goals by Martin Gelinas and Dave Karpa 26 seconds apart late in the period.

But Nashville's Mike Watt stopped Carolina's momentum by scoring just 21 seconds into the third. The Predators blew it open as Greg Classen and Greg Johnson tallied 1:35 apart to make it 7-3 midway through the period.

Vokoun, who extended his club record by making his 14th straight start in place of the injured Mike Dunham, improved to just 4-7-3.

Hurricanes goaltender Arturs Irbe was replaced after allowing four goals on 13 shots in the first period. Tyler Moss gave up all three goals in the third period.

The loss snapped a two-game winning streak for the Hurricanes, who returned home following a 3-0-0-1 road trip.



Minnesota 4, Vancouver 2. Antti Laaksonen recorded the first hat trick in franchise history as the Minnesota Wild extended their best unbeaten streak to four games with a 4-2 victory over the Vancouver Canucks. Laaksonen scored the first two goals of the game in the second period and finished off his first career hat trick 8:20 into the third. He also had an assist for a personal-best four points.


Wes Walz also scored for the expansion Wild, who won despite being outshot, 31-20. They are 3-0-1 in their last four games. 


(For more results see Scorecard.)

TITLE: Celtic Pride Continues To Wane With Loss to Grizzlies
PUBLISHER: Reuters
TEXT: BOSTON - Shareef Abdur-Rahim came to FleetCenter Sunday and made himself at home, leaving the Boston Celtics decidedly put out.


Abdur-Rahim scored eight of the Vancouver Grizzlies' last 10 points as they held Boston without a field goal over the final 4:55 to pull out a 98-87 victory, snapping their losing streak at seven games.

Abdur-Rahim finished with 27 points and 21 rebounds - one shy of his career high - and Mike Bibby added 13 points and 12 assists for the Grizzlies.

Paul Pierce scored 27 points and dished out four assists and Antoine Walker added 18 points for Boston, which slipped to 6-3 at home. The Celtics' only wins this season have come in this building.

The Celtics led by as much as 27-16 in the first quarter, but the Grizzlies turned things around when they opened the second period with a 15-4 run, tying the score at 31-31 on Bibby's basket with 8:20 left in the half.

The Grizzlies seemed to break open the game when they went on a 22-6 run beginning late in the third quarter, opening up an 82-67 lead on a layup by Ike Austin with 11:30 to play.

Boston scored a season-low 12 points in the third quarter, and looked to be finished.

The Celtics roared back, running off 13 straight points during one stretch in the fourth quarter to come within 86-84 when Pierce picked off an inbounds pass and went in for a layup with 4:55 to go.

Grant Long, who finished with 14 points, answered with a jumper from the top of the key with 3:19 remaining and Boston's last points came on a pair of free throws by Pierce with 2:30 left.

The Grizzlies scored the final eight points, six from Abdur-Rahim, to win for the first time since Nov. 8, when they were 4-1.

(For more results see Scorecard.)

TITLE: IN BRIEF
TEXT: Cole Charges

ADEN, Yemen (AP) - Yemeni investigators are ready to charge at least two people in the apparent terrorist attack on the USS Cole, a source said Sunday, six weeks after an explosion tore through the warship as it sat in Aden's harbor, killing 17 U.S. sailors. 

Charges are expected to be filed as soon as this week against the two suspects, the source said. They could be sentenced to death if convicted.

But any charges are unlikely to mean the end of the probe: U.S. investigators suspect an international conspiracy was behind the bombing. 

U.S. and Yemeni officials have said the attack appeared to be a carefully planned, well-financed operation, and that the bombs materials were expertly prepared. 



Fujimori Challenge

TOKYO (Reuters) - Peru's disgraced ex-president, Alberto Fujimori, challenged his successors on Monday to push ahead with a crackdown on corruption, and stressed that he still has a mission to wrest his country from the politics of money.

However, he hinted he may choose to fight his battles from outside the political arena. He has gone into exile in Japan, the land of his ancestors, from where he submitted his resignation last week.

Fujimori seemed to be moving away from his earlier intention of seeking a return to politics by standing in the April election, but said he was looking at various options.



French Barbecue

MARSEILLE, France (AP) - About 3,000 people gathered in Marseille on Sunday for a barbecue organized by the city's butchers, who handed out free beef to boost consumer confidence amid growing worries over mad cow disease. 

About 50 butchers distributed 3.6 tons of beef to Marseille meat-lovers, who wandered between stands and piled kebabs and dripping slabs of rare roast onto heaping paper plates. 

"We told people that, when it comes to safe beef - in this case, Charolais red label - they can have confidence in their butcher," said Joseph Emmanuel Mordiconi, the butcher who organized the fete.

Public fears about the dangers of eating beef reached panic levels in France last month, when it was discovered that meat that was potentially infected with BSE had made it to supermarket shelves. 



Yugoslavia Deal

BELGRADE, Yugoslavia (AP) - The European Union has signed a long-term cooperation agreement with Yugoslavia, rewarding the country's new leaders for their movement toward democracy and urging them to continue in the same direction. 

The agreement - the first of its kind with a Balkan nation - was signed Saturday by Yugoslav President Vojislav Kostunica and EU Commission chairman Romano Prodi. Both said it "institutionalized cooperation and relations" between Yugoslavia and Europe. 

Describing his talks with Kostunica as fruitful, Prodi said that "one should have confidence in Serbia, as it obviously has chosen another political road." Serbia is the larger of the two republics that make up Yugoslavia. 


Burundi Talks

ARUSHA, Tanzania (AP) - Former South African president Nelson Mandela said he was confident talks to end Burundi's seven-year civil war would succeed, as leaders from 19 Burundian groups met Sunday to find a consensus leader of the country's transition to democracy. 

Mandela, who has helped mediate the talks, dismissed speculation that Burundi's leaders are not ready to agree to cease-fire, despite a power-sharing deal reached in late August. 

"I am confident that we are making progress and we are going to reach a political settlement," he told reporters at Kilimanjaro International Airport. 

Mandela then drove to the northern Tanzanian town of Arusha, where the peace talks have been taking place for more than two years, to meet with Burundian President Pierre Buyoya. 



Journalist March

APUTO, Mozambique (AP) - About 300 people held a silent march to condemn the killing of a Mozambican journalist known for his sharp criticism of the government. 

Witnesses said Carlos Cardoso, 49 years of age, was riding in a car Wednesday night when two vehicles forced it to stop. Gunmen emerged from the cars and shot Cardoso and his driver. Police said they were investigating, but currently had no suspects. 

In Friday's march, protesters carried photos of Cardoso and placards demanding justice. Cardoso, the owner and editor of the daily Metical, was one of the most respected reporters in the country.

TITLE: Cambodian Guerrillas Attack
PUBLISHER: Reuters
TEXT: PHNOM PENH, Cambodia - A U.S.-based anti-communist group says it was behind a shootout in Phnom Penh and has threatened to keep fighting until it overthrows the government, according to a Khmer-language radio report. 


"Some forces of the Cambodian Freedom Fighters attacked the government troops in Phnom Penh. ... It was not terrorism. It was a real attempt to oust the government," an unidentified member of the group told Radio Free Asia.

Police shot dead eight men after a gang flying the Cambodian Freedom Fighters flag went on a nearly one-hour rampage at about 1 a.m. on Friday.

The fighting was the worst Cambodia has seen since the July 1997 overthrow of then-First Prime Minister Prince Norodom Ranariddh.

Police have arrested more than 60 suspects, including a Cambodian-American caught at Siem Reap airport Saturday evening, Phnom Penh military police chief Chhin Chan Por said on Sunday.

TITLE: Argentina Uncovers Past Of Brutal Junta Killings
PUBLISHER: Reuters
TEXT: BUENOS AIRES, Argentina - Twenty-four years after an Argentine "Dirty War" era death squad took both their lives, Jose Daniel Bronzel was finally buried on Sunday next to his wife in a humble Buenos Aires cemetery.


Bronzel, whose remains uncovered in a mass grave were identified by forensic experts, and his wife Susana Elena Pedrini were just two of the roughly 30,000 people who disappeared during Argentina's brutal 1976-83 military dictatorship and are presumed dead.

"In the midst of so much horror, it is a blessing to be able to bury Jose and Susana together," said a tearful Noemi Ped rini, Susana's sister, as a small crowd gathered around the flower-adorned tomb.

In June 1999, the same group of forensic experts identified the remnants of Susana Pedrini, who was carrying a two-month-old baby when she disappeared on July 27, 1976.

Human rights abuses were rampant throughout Latin America in the 1970s and '80s as military regimes kidnapped, tortured and often killed suspected leftist guerrillas.

Many of those killed in Argentina were dumped out of airplanes into the River Plate on so-called "flights of death," and their bodies never recovered.

In 1985, several members of the military junta were jailed for human rights violations but were freed five years later after being pardoned by then-President Carlos Menem. Many now face charges of kidnapping babies born in captivity, a crime not covered under the pardon.

Bronzel and his wife were imprisoned before their death in what is now a police headquarters building, just a few yards from Congress. The couple died along with 28 others in a mass killing and their bones were tossed into an unmarked grave in a Buenos Aires suburb. It wasn't until the 1990s that forensic experts began identifying the remains.

Only 13 of the 30 killed in the Aug. 20, 1976, massacre have been identified. Among those still to be identified is Cecilia Podolsky, Bronzel's mother, also murdered in that incident.

TITLE: SPORTS WATCH
TEXT: Heat Acquires Ceballos

MIAMI (AP) - The Miami Heat, looking for help off the bench, acquired forward Cedric Ceballos from the Detroit Pistons on Sunday night for a conditional second-round draft choice.

Ceballos is an 11-year veteran with career averages of 14.6 points and 5.5 rebounds. He has played for the Phoenix Suns, the Los Angeles Lakers, the Dallas Mavericks, and the Pistons.

Ceballos' best season was 1995, when he was named to the All-Star team.

This season he averaged 5.8 points in limited playing time with the Pistons. He scored a season-high 23 points on Nov. 15 against Indiana, and the offense-starved Heat are hoping he can provide some.

To make room for Ceballos, the Heat waived forward Jamal Robinson, who made the team as a free agent but appeared in only six games this season.



Stockton Sets Record

AUBURN HILLS, Michigan (Reuters) - It seems as if John Stockton has been a member of the Utah Jazz forever and that may not be too far from the truth.

The NBA's all-time assists leader handed out 15 more in Sunday's 94-79 victory over the Detroit Pistons. It was Stockton's 1,271st game with the Jazz.

That broke the NBA record for most games with one team, which had been held by Hall of Famer John Havlicek, who played 1,270 games with the Boston Celtics in his brilliant career.

"Any time you can get mentioned with him, that's a plus," said Stockton.

"I've been fortunate to be part of an organization with great teammates. A lot of things have to go right. You have to be healthy, obviously. You have to have a team that wants you to be there. You have to want to be there.''



Top Athletes Named

MONACO (Reuters) - Czech javelin thrower Jan Zelezny and U.S. sprinter Marion Jones were named athletes of the year by the International Amateur Athletic Federation Sunday.

IAAF president Lamine Diack made the announ cement at the World Athletics Gala.

Zelezny, 34, ignored back and elbow pains to become the first javelin thrower to win three Olympic titles with gold at the Sydney Games in September.

He won his golds in consecutive Olympics in 1992, 1996 and 2000.

Jones, 24, made an ambitious bid for five gold medals in Sydney but instead finished with three golds in the 100 meters, 200 meters, and 4x400 meters relay and two bronzes in the 4x100 relay and long jump.

The award was Zelezny's first, while Jones won in 1997 and 1998.



Kafelnikov Speaks Out

LISBON (Reuters) - Russian Olympic gold medallist Yevgeny Kafelnikov wants Moscow to stage the season-ending ATP Masters Cup to allow the Russian people to indulge what he claims is one of their few pleasures left in life.

"People have nothing left except Spartak Moscow and tennis in Russia," Kafelnikov said.

Kafelnikov is in Lisbon with compatriot and current world No. 1 Marat Safin for the 2000 Masters Cup.

"Moscow should definitely try to stage this. And we should get it. Come on, we would have sell-out crowds every night."

TITLE: Kostunica Issues Rebel Threat
AUTHOR: By Aleksandar Vasovic
PUBLISHER: The Associated Press
TEXT: BUJANOVAC, Yugoslavia - Serb police said they would use all available means, including heavy weapons, to regain territory lost to ethnic Albanian militants as a Monday evening deadline approached for NATO to crack down on the rebels. 


Vojislav Kostunica's new government believes ethnic Albanian extremists operating from Kosovo launched attacks in southern Serbia, capturing four villages in the U.S.-patrolled buffer zone between Kosovo and Serbia. 

Belgrade is threatening to launch counterattacks on its side of the border if NATO cannot curb the infiltration by 7 p.m. Monday. 

Serbian police said in a statement that if ethnic Albanian militants don't withdraw by the deadline, security forces will use "all available means" to drive out the insurgents. 

"The Serbian government will do everything to resolve the crisis by political and peaceful means," said one of Serbia's three co-ministers of the interior, Stevan Nikcevic. "At the same time, we have to protect the territorial integrity of the country so the terrorists don't jeopardize the lives of our citizens." 

Heavily armed Serbian security forces were being deployed near the boundary of the three-mile demilitarized zone as tensions grew by the hour. On Sunday, Yugoslav army T55 battle tanks and armored personnel carriers could be seen maneuvering near the buffer zone. 

Kosovo is a province of Serbia, Yugoslavia's main republic, but it has been under international control since last year and many residents want full independence. The crisis erupted last week when ethnic Albanian militants of the "Liberation Army of Presevo, Med ve dja and Bujanovac" attacked Serb positions in the Presevo Valley to unite the area with Kosovo. 

Although the area has a substantial ethnic Albanian population, the valley was not considered part of Kosovo and was not included in the June 1999 agreement sending NATO peace keepers into the Serb province. 

The incidents cast doubt on NATO's ability to control Kosovo and also present a major crisis to the Kostunica government, which must defend the area without provoking the same international condemnation that erupted after Slobodan Milosevic's crackdown on Kosovo rebels in 1998. 

This action provoked the 78-day NATO bombing of Yugoslavia in 1999, which ended with Belgrade handing over the province for control by the United Nations and NATO. 

"We have to save lives and we don't want to be drawn into another provocation which could change the current favorable international position of Yugoslavia, and possibly trigger another intervention from abroad," Kostunica told Serbian television. 

Nevertheless, the presence of tanks, personnel carriers and infantry was seen as a demonstration of Belgrade's resolve to prevent ethnic Albanians from seizing Serbian territory. 

The Yugoslav interior ministry estimates that about 1,000 ethnic Albanians were involved in the recent attacks and were receiving support from ethnic Albanian sympathizers in nine villages on Serb-controlled territory.

TITLE: Montgomerie Takes Skins Game in Playoff
PUBLISHER: Reuters
TEXT: INDIO, California - Colin Montgomerie made the fewest birdies but he sank a two-foot par putt worth $340,000 on the third playoff hole to walk away the big winner of the 18th annual Skins Game Sunday.


While it will not make up for his three runner-up finishes in major championships on U.S. soil, Montgomerie heads back to Scotland with $415,000 and his first American win in the unofficial, four-player event.

Masters champion Vijay Singh, like Montgomery a first-time Skins Game participant, finished second with $260,000. Spaniard Sergio Garcia, who led after the first day's nine holes with $150,000, wound up third with $200,000, while defending champion Fred Couples was fourth with $125,000.

"There is a lot of luck involved here," Montgomerie said. "I didn't actually play very well and I think my partners would agree."

Over the two days, Montgomerie picked up his ball twice, hit a ball into the water and missed several makable putts. But he made crucial shots when it mattered most. He chipped in from 15 feet on the first playoff hole to match a birdie by Couples, and forced a third playoff hole with a short putt on the second extra hole.

Couples, who earned a record $635,000 last year that included a record $410,000 birdie putt, blew his chance to end the event on the second playoff hole when he missed a 6-foot birdie putt on the par 3.

Couples, who had claimed two skins on the 11th hole worth $100,000, made life easy for Montgomerie on the third playoff hole. He pushed his drive into a bunker, hit his second shot off a golf cart and under a bush, and dropped his third shot into the water before managing a bogey.

TITLE: Roma, Man United Go Clear at the Top
PUBLISHER: Reuters
TEXT: LONDON - Girondins Bordeaux took the honors as French leaders at the halfway stage of the season following a 0-0 draw at second-placed Sedan. Manchester United has gone eight points clear in England while AS Roma stretched its lead in Serie A after an emotional night for Gabriel Batistuta. 


England. Manchester United is now 1-12 favorites to win the premier league after opening an eight-point lead this weekend. The champions needed an hour to break through Derby County's defense at Pride Park but then goals by Teddy Sheringham, Nicky Butt and Dwight Yorke secured a 3-0 victory. Second-placed Arsenal made it five defeats and a draw from seven games, losing 1-0 to Olivier Dacort's free kick at Leeds United. United has 36 points, Arsenal 28 with promoted Ipswich third with 27 after a 3-2 win at Manchester City. 




Spain. A Gaizka Mendieta penalty and a spectacular strike from Kily Gonzalez gave Spanish first division leaders Valencia a 2-0 win over Real Oviedo but Deportivo kept pace as a brilliant curler by Brazilian Djalminha was enough to beat Celta Vigo. Both teams have 24 points but Valencia leads on goal difference. Real Madrid, without a game this weekend because it is playing in the World Club Cup in Tokyo on Tuesday, stays in third place with 20 points. Real Mallorca is fourth, also with 20, after a 2-1 home win over Villarreal




Italy. Gabriel Batistuta scored against the side he served for nine seasons as AS Roma beat Fiorentina to move three points clear. The Argentine striker refused to celebrate his 83rd-minute goal and left the Olympic Stadium in tears. Roma has 21 points, three clear of Atalanta Bergamo, 1-0 home winners over Lecce. Udinese lost 2-1 at Bari to drop to third with 16, ahead on goal difference over Bologna, 3-1 winners at Perugia. Parma beat Lazio 2-0 while there were also victories for Juventus and AC Milan. Crowd trouble caused the abandonment of the bottom-of-the-table clash between Reggiana and Brescia six minutes from time with the visitors leading 3-0. 




France. This clash turned out to be a disappointment as leaders Girondins Bordeaux held second place Sedan to a goalless draw to complete the first half of the season at the top of the table. Bordeaux, who extended its unbeaten run to 15 games, has 30 points to the 29 of Sedan, who had much the best of the match. En Avant Guingamp is third with 28 after a 1-0 win at Troyes. Nantes is fourth with 27, winning 2-0 at St. Etienne. 




Germany. Two goals from Oliver Neuville helped Bayer Leverkusen to a 4-2 win over Kaiserslautern that took them back to the top of the Bundesliga on Sunday. Leverkusen moved to 28 points, one ahead of Schalke 04 who had enjoyed a 48-hour spell at the top after beating bottom-placed VfL Bochum 2-1 on Friday. Hertha Berlin is third, also with 27, after bouncing back from last week's 4-0 defeat at home to Schalke with a 4-0 away win at Eintracht Frankfurt. Bayern Munich is fourth with 23 after a 1-1 draw at SC Freiburg. 




The Netherlands. A ninth-minute tap-in by Jon Dahl Tomasson proved enough for a tired and depleted Feyenoord to beat Willem II Tilburg 1-0 on Sunday to regain the lead in the Dutch first division. With last week's leaders Vitesse Arnhem not playing Feyenoord moved on top with 31 points from 12 games. PSV Eindhoven beat NAC Breda 2-0 to move into second with 30 points from 13 games. Arnhem drops to third with 29 from 13.

TITLE: Austrian Captures 30th Title
PUBLISHER: Reuters
TEXT: LAKE LOUISE, Alberta - Austrian superstar Hermann Maier said good-bye to his girlfriend Sunday and went back to the business of winning World Cup ski races as he captured the first super-G of the season for the 30th World Cup victory of his storied career.


Maier shrugged off a 15th-place finish in Saturday's first downhill of the season and overpowered a difficult super-G run to finish in one minute 29.53 seconds at Lake Louise Ski Area and regain the top spot in the World Cup overall race.

Maier's girlfriend had been with him on this visit to the Canadian Rockies. "It was like a holiday for me," he said.

But after his disappointing downhill, they had a nice dinner and she headed back home.

"She is gone and I get back to business," said the two-time Olympic gold medalist and defending World Cup overall and super-G champion.

Lasse Kjus of Norway, who missed most of last season with sinus and bronchial ailments, continued his remarkable comeback with a second-place finish in 1:29.85.

Maier's teammates took the next four spots with Andreas Schifferer third in 1:29.95 and Stephan Eberharter coming in fourth as Austrians claimed six of the top 10 places.

"It sometimes gets lonely up on the podium," joked Kjus, the 1999 overall champion, who is getting accustomed to being the only non-Austrian on the podium.

For Maier, his 30th World Cup win was just another day at the office.

"It was ordinary for me ... nothing special," shrugged Maier, who also won the opening race of the season a month ago, a giant slalom at Soelden, Austria.

"It was hard in the last three races and I'm very happy about this result," he said. "It's a really difficult super-G. It was a hard race, but I like hard races."

Both Maier and Kjus said they were looking forward to next weekend's downhill and super-G at Beaver Creek, Colorado.

Kjus won two golds and three silvers at the 1999 World Championships in Beaver Creek, while Maier earned two gold medals there, tying Kjus for gold in the super-G.

"I have good feelings for Beaver Creek," Maier said.

Countered Kjus: "Beaver Creek's been good for me."

TITLE: Zenit Looks Ahead to Next Season
AUTHOR: By Christopher Hamilton
PUBLISHER: Special to The St. Petersburg Times
TEXT: Following Zenit's general shareholders meeting last week, club president Vitaly Mutko and head coach Yury Morozov reviewed this past season and announced their plans for the future on Friday.


Neither Mutko or Morozov would comment on who they were inviting to try out for the team. Morozov did say, however, that they are interested in trying to bring back Ukrainian national team member Roman Maksimyuk to St. Petersburg. 

"Roma had a great season with us in '99. A player at his level shouldn't have to spend so much time on the bench," Morozov said after confirming that team management was trying to work out an agreement with Dinamo Kiev.

Despite failing to reach their goal of winning the bronze medal and qualifying for the UEFA Cup, team directors were upbeat and optimistic. "Had their not been biased refereeing in No vo ros sisk and Makhachkala we might have achieved our goal. And despite our final standing, the team had just as many points this year as it did in 1998 when it finished the season in fifth place [Ze nit's best season in the past decade]," Mo rozov said.

"The biggest problem this year was stability. Many of the decisions we made regarding contracts had either to do with their stability or willingness to give everything for the team," Morozov said.

"I spoke with some of the players and told them it is up to them to decide if they are going to remain on the team," Morozov explained.

"[Moldovan national team halfback Alexander] Kurtiyan was a prospective player in 1999. He added a lot to the team. But this year he got a red card and didn't show team spirit. Likewise with [striker Yury] Yaskov, who truly faltered after a hopeful start."

Management decided to cut goalkeeper Roman Be re zovsky and defenders Andrei Kondrashov and Yury Vernidub from the team.

"We are not just throwing away players here. We are helping them continue their careers," Mutko said.

"Berezovsky is a good player who can play at the European level. But for the last two years he hasn't had any competition for his position and has psychologically lost the edge. At the start of the season I said that it was his decision to play for Zenit or to move on. St. Etienne was one of 10 options we presented to him," Mutko explained.

"We have two prospective young goalkeepers fighting for the position, and I feel good about this. In fact I am happy with all of our lines. Our defensive line had a great season playing either with 3, 4, or 5 players. [Dmitry] Davydov worked well as Libero and [Alexei] Katulsky did well when Davydov was injured. The fact that we had the second best goals-allowed record this season speaks for itself. ... The attacking line was definitely led by [Alexander] Panov until he went to France," Morozov said.

"We have a team in mind and we need to select a core of nine players and add players around them. We had a number of problems with injuries this year, there are still questions regarding injured players, but we need to develop depth in our roster," Mutko said.

TITLE: Johansson Pulls Off Upset in Stockholm
AUTHOR: By Per Danielson
PUBLISHER: Reuters
TEXT: STOCKHOLM - Sweden's Thomas Johansson defeated Russian second seed Yevgeny Kafelnikov, 6-2, 6-4, 6-4, in less than 90 minutes to claim the Stockholm Open title on Sunday.


Unseeded Johansson played nearly perfect tennis on the Royal Tennis hall center court, hitting winners at will and not allowing Kafelnikov into the game.

"I played extremely bad at the same time he played his best tennis ever. I never got my game started before it was over," Kafelnikov said.

The victory was the first of the year and the fourth overall for the 23-year-old Johansson, and he improved his head-to-head record with Kafelnikov to 6-4.

Johansson had reached his second Stockholm Open final by beating top seed Magnus Norman in the semifinal on Saturday. He lost the 1998 final to American Todd Martin.

"When I played Martin I was nervous, but today I felt confident I could beat Kafelnikov," said Johansson, who knocked out defending champion Tho mas Enqvist in the first round.

Kafelnikov picked up his game in the second and third set but Johansson continued to place his hard groundstrokes out of reach.

"He had a good game, unfortunately he is not consistent enough to be a top player," said Kafelnikov who dropped his serve six times and had 10 double-faults. Johansson squandered one match point in the third set before Kafelnikov overhit a forehand to finish the game.


*******

Tim Henman closed out an impressive season Sunday by winning a tournament in his homeland for the first time at the $400,000 Samsung Open.


In a matchup of top seeds, Henman dumped second seed Dominik Hrbaty of Slovakia, 6-2, 6-2, in 84 minutes to capture his second ATP Tour title of the year and sixth of his career. He earned $54,000 for the victory.

The 26-year-old Henman ended a two-year title drought at Vienna last month and reached five finals overall this year. However, he failed to qualify for the year-end Tennis Masters Cup, which begins on Tuesday. He is listed as an alternate in case of player withdrawals.

Hrbaty, 22, finished the year winless in three ATP Tour finals. He also was runner-up at the Tennis Masters Series event in Monte Carlo in April and at the St. Petersburg Open earlier this month. The Slovakian was seeking his third career ATP Tour title. 


- Reuters