Talking of A1 Plus, although now officially on holiday, they’ve just posted a statement from USAID on the suspected transfer in ownership of Armenia’s energy distribution company which I blogged about on Tuesday.

The United States Agency for International Development (USAID) is concerned by reports that a transfer of the beneficial (or economic) ownership of Armenia’s energy distribution company (Electric Networks of Armenia, or ENA) from its currently licensed owner (Midland Resources Holding) may have taken place. If these reports are correct, this transfer occurred without following important Armenian government regulations which exist to protect Armenian consumers. As we wait for this situation to be clarified, USAID is reviewing its assistance portfolio to determine whether the success of some of its ongoing or planned projects would be undermined by any revised ENA ownership arrangement, or by a lack of due process in changing that ownership arrangement.

After criticism from the World Bank on the transfer, word that USAID are now reviewing their activities in Armenia is quite serious. Of course, this being Armenia, the games have already started. According to RFE/RL, the nominal owner of the network says it has merely transferred management and the right to derive income. Strange that the Russian UES announced that it had actually purchased the network on 1 July until they retracted the announcement on 13 July.

The assurances came amid growing questions about the legality of the deal raised by Armenia’s Western donors. They argue that the reported sale of the Electricity Networks of Armenia (ENA) to an obscure subsidiary of Russia’s RAO Unified Energy Systems (UES) group called Internergo occurred without the Armenian government’s prior consent, which is required under the terms of ENA’s privatization three years ago.

[…]

The government’s surprisingly passive stance on the matter has drawn sharp criticism from the World Bank and the U.S. government’s Agency for International Development (USAID) which believe the ENA deal threatens the success of the decade-long reform of Armenia’s energy sector. The USAID warned on Tuesday that it could reconsider its assistance to the sector. Robison has similarly hinted that the government’s handling of the affair could affect the release of further World Bank loans to Armenia.

The latest RFE/RL news item on the twists and turns in what sounds to be a very dodgy deal indeed can be read online here. Then again, when Midland Resources Holdings took over the network, proceedings weren’t exactly open and transparent either.