KIEV, March 2 Ukraine's SCM Group, a financial
and industrial group whose businesses are the main employer in
the eastern conflict zone, said on Thursday it would fight a
demand by separatists to re-register firms in rebel-held areas.
Separatists have demanded Ukrainian companies in their
territory register locally and pay them taxes in response to a
rail blockade on goods from rebel territory that has highlighted
the deep economic ties between the regions, despite three years
of simmering military conflict.
"We consider private property to be sovereign and the demand
to re-register our businesses and pay taxes to the
self-proclaimed 'Donetsk and Luhansk People's Republics' is
unacceptable," SCM Group said in a statement.
"No kind of pressure will force us to change the
jurisdiction of our assets."
SCM Group is owned by Ukraine's richest businessman, Rinat
Akhmetov, and on Wednesday one of its telecoms firms and a
humanitarian organisation funded by Akhmetov said their
businesses based in separatist-controlled Donetsk city had been
seized by armed men.
Ukrainian President Petro Poroshenko condemned the
separatists' move as illegal appropriation and said a recent
flare-up in fighting showed that the crisis in the east was once
Previously, SCM Group's Metinvest, Ukraine's
largest steelmaker, said if separatists took control of mills or
mines in rebel-held areas it would be forced to halt production
in the affected operations.
In its statement, the conglomerate emphasised its importance
as one of Ukraine's top employers. "We provide jobs for hundreds
of thousands of people across the country, from east to west,
including in territory temporarily not under Ukraine's control."
The rail blockade, initiated by some lawmakers and military
veterans but opposed by the government, has already forced
Metinvest to halt production temporarily at one of its mills and
several coal mines.
Both the Ukrainian authorities and separatist officials have
warned of damage to the economy from the squeeze on rail trade
from rebel-held territory, which was initiated by a group of
Ukrainian lawmakers and military veterans.
Separatists say local industrial firms are suffering, while
Ukraine says the country could be hit by rolling blackouts and
lost foreign export income of up to $2 billion.
(Reporting by Natalia Zinets; Writing by Alessandra Prentice;
Editing by Richard Lough)