The “Kafesjian” fund would not make big efforts in demanding the
monopolization of “HyeFilm” film studio if the Republic of Armenia had
paid back the $600 U.S. dollar loan given by the fund just 8 months
ago. Since Armenia is not used to paying back debts on time, the
“Kafesjian” fund has decided to get ownership of “HyeFilm” in exchange
for the debt. In times like these the debtor makes decisions about what
is necessary for Armenia and that’s what has a strategic significance.
The authorities of Armenia consider all those types of transactions as
“big achievements”.
The prehistory of the debt
During the time when mayor of Yerevan Robert Nazaryan was in office, on
April 26, 2002, a contract entitled “A Purposeful Loan” was signed
between the Republic of Armenia (along with the city council) and the
“Kafesjian” fund regarding the transfer of $600,000 U.S. dollars to the
“North Street and Cascade” state-owned project implementation office’s
(SOPIO) currency account (order 44/01-3606T). Three days after the
contract, the promised amount was transferred to the SOPIO. According
to the contract, the deadline for returning the debt was September 15,
2002. It seems highly illogical how the Republic of Armenia, better yet
the city council was going to come up with $600,000 dollars in such a
short time. The money did not get returned to the “Kafesjians” and the
deadline, which was September 15, got postponed to January 31, 2003,
and then December 31 of the same year. These postponements were also
illogical. Until today Armenia still has not returned the $600,000
dollar debt.
With loss of any hope of ever getting the money back, the “Kafesjian”
Fund has decided to receive some land in exchange for the debt. The
fund has set their eyes on the “HyeFilm” studio. They want to privatize
that with the same amount as the debt that Armenia owes-$600,000
dollars. This seems kind of absurd taking into consideration the fact
that the “HyeFilm” studio costs much more than that amount. The fund
claims that the decision of privatizing the studio was not the fund’s
idea, but rather Bagrat Nersisyan’s idea, who is the president of
“Armenia” television network and of which The “Kafesjians” hold 50%
share. The authorities of Armenia are not making a big deal out of the
whole thing. Towards the end of all this, in comes the offer of
president of the Armenian community in Russia Ara Abrahamyan.
Abrahamyan’s offer, in contrast to the “Kafesjian” fund’s offer, sounds
more favorable. However, Mr. Abrahamyan’s offer would surely get
dismissed due to the not too intimate relations between Robert
Kocharyan and Ara Abrahamyan.
What have they done with the $600,000 dollars?
Prime Minister Andranik Markaryan is also pondering about this
question. “168 hours” weekly has the #89-132 record of evidence signed
by Andranik Markaryan on December 10, 2003 during a consultation. The
record states that the government doesn’t even know about any debt.
Even Minister of Finances of the Republic of Armenia Vartan
Khachaturyan did not know about it. During the consultation, he
affirmed that there are no records of a debt, so there could be no
discussion about that. “What is this? This is intolerable. Whoever
comes to Armenia making offers means we have to welcome them with open
arms?….” said Vartan Khachaturyan during the consultation with the
prime minister. The uninformed prime minister gave the following order
to the corresponding ministers (Vartan Khachaturyan, David Harutyunyan,
David Vartanyan, Tamar Poghosyan, and chief specialist of the economy
department of the government of the RA T. Sahakyan): “Check with the
mayor and find out how we got a $650,000 dollar debt(here it is
$650,000 because this shows that the prime minister is completely
clueless-L.S.) to pay to the “Kafesjian” Fund. Let me know about
everything.” However, until today the ministers still have not been
able to “word” the information.
Before this consultation, there had also been a consultation with the
president and the same people. Robert Kocharyan not only knew about the
debt, but also gave a command to prepare the monopolization documents
and transfer the studio to the “Kafesjian” Fund. The ministers present
agreed without saying a word and promised to inform the president at
the end. However, one of the ministers was forced to explain to
Kocharyan that first of all, it is not possible to quickly prepare the
documents due to the fact that the law first deals with all the
processes which take place during privatization (inventory, etc.) and
secondly, he pointed out that they can not let “HyeFilm” get privatized
because the studio, with its huge archive, needs to be under the
ownership of the nation. Of course, the president had not been too
pleased with how the minister dared to make such remarks and explain
the whole process of privatization.
“HyeFilm” has always attracted attention
According to owner of “HyeFilm” Gevorg Gevorgyan, there have been many
attempts in privatizing the studio in the past decade, but the
administration has done everything it can to prevent that from
happening. What’s more noteworthy is G. Gevorgyan’s following
statement: “I have said the same thing to all the people who have
attempted to privatize the studio. I have told them that this studio is
sacred foro us, and whoever makes money out of it, sells it, eliminates
it, he/ she will suffer the consequences. If that person buys a car,
he/she will have a car accident, if a house is built, it will soon
collapse. I have said this to everyone, including one of the
ministers.” Mr. Gevorgyan believes that “HyeFilm” has always attracted
attention due to the fact that the studio has an area of 34 hectors,
the location is suitable (located on the highway going towards
Ashtarak). Besides that, just recently “HyeFilm” privatized the
vineyards near the Ashtarak road. Mr. Gevorgyan also stated that not
only the authorities, but also individuals have always tried to “bribe
the “HyeFilm” administration in selling the studio, threatening us with
guns” however, in vain.
The “HyeFilm” management had presented one of the representatives of
the “Kafesjian” Fund John Watersin with an offer consisting of 17
paragraphs. The offer proposed that the privatization would be possible
only after satisfying all the requirements stated in the paragraphs.
One of the conditions concerned the studio’s films. No film may leave
the country because it belongs to the state. “I have also told the
president that we can not transfer the films to another individual or
organization. If the given individual gets the film, he can then claim
that he burned the tape because there were 5 grams of silver in the
tape and that’s all he needed. But those films represent a part of our
national heritage. The next generations have to see the Parajanov
culture and learn from it. The second condition stated that we must
film 3-5 films a year, and in particular, Armenian films so that we can
continue the film industry. It is possible that owner Gor
Vartanyan-along with his “boyeviks”(I don’t underestimate his work) may
make a film out of the already existing film “ Harsnatsun Jermukits”
(The Bride from Jermuk), claims it to be Armenian just because there
are Armenian actors when really it is not an Armenian film at all,”
says Mr. Gevorgyan. One of the requirements of the studio has been to
keep the art counsel and the orders for film production will be made
based on the counsel’s decision. “At first, the fund representative
agreed with the offer, but then the fund presented a totally different
plan which “HyeFilm” come to terms with. They were demanding that we
completely eliminate “HyeFilm” and give the films to them. Our
agreement had turned into a disagreement, which was sort of a warning
for us,” says G. Gevorgyan.
The owner of the film studio thinks that the privatization of the
studio could have a positive effect on the development of the Armenian
film industry. However, after the several negotiations with the
“Kafesjian” fund, Mr. Gevorgyan considers the fund’s involvement as
disastrous. “Even if the person privatizing “HyeFilm” were to totally
agree with all our requirements, there would still be the fear of
losing “HyeFilm” because there is no guarantee that the owner will not
change everything,” said Mr. Gevorgyan noting the fact that “there is
another variant for privatization: not 100% state owned, but 50%, which
does not favor the “Kafesjian” Fund. The fund says that even if 0.5% is
state property, they will still reject the offer. They wanted to get
the studio in exchange for the $600,000 dollar debt and add an
investment of $5,000,000 dollars. But turning in the studio for
$600,000 dollars is totally absurd.”
“HyeFilm” got temporarily saved
“HyeFilm” would be purchased a couple of months ago if a second offer
had not been made- making way for competition. That offer was made by
Ara Abrahamyan who was more like an obstacle for both the “Kafesjian”
Fund and the Armenian authorities, who were mainly interested in paying
back the $600,000 dollars by giving the film studio to the fund. Until
Ara Abrahamyan’s offer, “HyeFilm” had not done any work on inventory.
This would be absurd from the start due to the fact that the
authorities were simply obligated to give the film studio to the
“Kafesjian” fund despite the real price. “When inventory began, I told
them that the studio’s value can not be stated as just a territory.
After all, who will state the value and how they will value it. For
example, take the film “Nran Guyn” (The Color of Pomegranate). What
value does it have?”, said Gevorg Gevorgyan during the interview. “Just
the name “HyeFilm” and its logo have a lot of value which needs to be
appreciated. Nobody can do a quick calculation and determine how much
the land costs and sell it. The price of one cadastre of land is one or
two million, but the market price is tens of millions of dollars.” Only
during the inventory did the authorities realize how difficult it is to
make an inventory of the film studio and privatize it. Besides that,
according to the law entitled “Privatization”, the business subject to
privatization and structures need to be certified by the National
Assembly, then be included in the list of privatizations, after which
certain processes take place. “HyeFilm” has gone through those
processes, but it is safe to say that they have been kind of tricky.
“We finally got to the point where the studio’s authorities realized
that we were right and that the studio could not just be privatized
like a factory or something,” said Mr. Gevorgyan. He also added that
the process of privatizing the studio has not been frozen, but rather,
it does not exist. “A decision has been made to carry out all actions
according the laws from now on- something which hadn’t been around
until now.”