...

Russian company returns prepayment to Iran for S-300

Iran Materials 23 September 2011 12:31
Rosoboronexport has turned out in a biggest financial loss over the last four years after returning a $167 million in prepayment to Iran for unfulfilled supply of S-300 air defense missile systems.
Russian company returns prepayment to Iran for S-300

Azerbaijan, Baku, Sept. 23 /Trend T.Konyayeva/

Rosoboronexport has turned out in a biggest financial loss over the last four years after returning a $167 million in prepayment to Iran for unfulfilled supply of S-300 air defense missile systems, Rosoboronexport Head Anatoliy Isaikin said in an interview with Kommersant Daily.

"The unrealized delivery of S-300 to Iran has been the largest financial loss for our company [since the beginning of his leadership in 2007]," Isaikin said. "We owed Tehran the prepayment of $167 million."

He noted that a commitment to return the prepayment enters in contracts with any country.

"According to a contract, a customer, in this case Iran, sends a prepayment to a Russian enterprise, which produce military products, and this prepayment is intended for launch of the production," Isaikin said.

"In its turn, Rosoboronexport gives a guarantee to return this prepayment in case of unforeseen circumstances. This refers to force majeure circumstances, such as the UN Security Council's sanctions. It has happened. Therefore, we should return this amount and we have done it."

This is not a very big amount, however this is a loss for the company, he stressed.

The contract to supply Iran with the missile system was signed at the end of 2007. Russia was to supply five divisions' worth of S-300PMU-1 for $800 million. Russia canceled the contract to supply Tehran with S-300 systems because of UN sanctions against the Islamic Republic.

On Sept. 22, 2010, Russian President Dmitry Medvedev signed a decree banning the transfer of S-300 missiles, armored vehicles, combat aircrafts, helicopters and ships to Iran.

This is envisaged by a presidential decree on measures to implement UN Security Council resolution 1929, dated June 9, 2010.

On June 20, 2011, Isaikin allowed the possibility of resuming negotiations with Iran on the S-300 after lifting UN sanctions.

Early September, Iran has appealed to the International Court of Arbitration over Russia's refusal to implement a contract for the supply of the S-300 systems to Iran.

Latest

Latest