First of all, we would like to express our gratitude to Prometey Group, including Prometey Grain Ltd., Prometey Trade Ltd., and Prometey Agri Ltd., as well as to Mr. Horoian, a final beneficiary of these companies, for the fact that after numerous discussions of problems in our business relationship you went public with this issue. Thus, you gave us freedom to discuss these issues publicly (on June 30, 2017, Latifundist.com posted an article “Prometey Group Accuses NIBULON of Failing to Pay for the Delivered Goods to the Terminal”).
While cooperating with partners, first of all, we hope for their honesty, decency, and fulfillment of their contractual obligations. Strict compliance with the requirements of the tax law and other ones, transparency of the work and openness in relations with regulatory bodies are a prerequisite for starting cooperation with our company. We cooperate with more than 4,700 partners in Ukraine. The share of agricultural producers in the turnover of NIBULON exceeds 85%. Given the financial risks, we treat intermediary companies with special attention, and Prometey Group (hereinafter Prometey) is one of them.  Work exclusively with agricultural producers, non-cash payment, solely with the declaration and payment of all taxes with mandatory registration of all tax invoices are the mandatory requirements for Prometey. Provided that, an intermediary company is responsible for its business activity in every sense of the word, both to the state and to its partners (including our company).
For example, according to clause 5.1. of the contract No. 831/2016 dated 09.12.2016 signed between NIBULON and Prometey Agri Ltd., “(…) The buyer pays 80% of the consignment cost for the relevant Supplement to the Contract for 3 banking days, starting from the day following the day when the supplier provides relevant original supplements with the signatures and seals of the parties, originals of delivery notes, invoices, documents specified in clauses 10.2, 10.10 of the contract to the purchase department of the buyer, (…) and after receipt of the electronic form of the notice of registration of the tax invoice in the Unified Register of Tax Invoices and electronic form of the tax invoice by the buyer (except for the cases provided for in clauses 5.5, 5.6. of the contract) and pays another 20% for the corresponding supplement – during 3 banking days beginning from the day following the day of the submission of documents specified in clause 10.3.5.”.
And according to clause 5.2 of the same contract ¨(…) In case of failure to fulfill (improperly fulfill) these obligations, including the cases if the sent tax invoices and/or adjustment calculations are formed in violation of the requirements provided by the Tax Code of Ukraine, the supplier pays the buyer a fine in the amount of 20% of the sum of the contract¨.
But during the execution of the above-mentioned contract, we have learnt that the companies of Prometey Group do not comply with the requirements of the contract. After we filed a VAT declaration, the State Fiscal Service Office for work with large payers sent us a series of letters; it is seen form their content that the origin of the goods purchased from the companies of Prometey Group, as well as their suppliers or producers, can’t be unambiguously established. Prometey does not have enough resources to sell products.
Although the companies of Prometey Group and their owner Mr. Horoian are trying to convince everyone that each of their economic operation is properly documented, and all the terms to pay for the delivered grain have passed, in fact, it is nothing more than an attempt to mislead both business partners and the community.
For example, Prometey Trade Ltd. issued tax invoices for grain that was delivered in October 2016 in the Unified Register of Tax Invoices with a huge delay only on March 22, 2017; this is violation of the tax legislation. In addition, until now Prometey Agri Ltd. has failed to verify the business relationship with our company, which confirms transactions and their reflection in the accounting and tax accounting; the tax authority should issue a corresponding certificate. As a result, our company has not received VAT refund totaling UAH 39 million for all goods delivered by Prometey Group for the period from May 2016 till October 2016, January 2017. Such actions of Prometey Group made us defend our interests and repeatedly apply to the bodies of the State Fiscal Service of Ukraine.
Unfortunately Prometey Group decided not to establish accounting records, to run transparent business, to declare and to pay taxes, but they decided to blackmail both the tax authorities and us as a company that is a conscientious participant of the grain market.
We have learnt this style of Peometey Group during the period of our cooperation. It rather creates problems in the process of cooperation than contributes to their minimization and elimination. After all, they are trying to blackmail their partners and use psychological pressure (including pressure through the media and the Internet). Mr. Horoian can picket the Main Department of the State Fiscal Service in Mykolaiv region. He can blackmail by the fact that Prometey’s employees will picket the office of our company and then come and boldly tell that, allegedly, I agreed with the tax authorities to pay UAH 17 million and what do they want now, if I have already agreed with them and paid this money … You have agreed with them and may even have transferred this money, but we have not received VAT refund. The mass media have repeatedly written about this: https://news.pn/ru/criminal/172657
https://news.pn/ru/money/171584
https://news.pn/ru/public/172693
https://news.pn/ru/money/182710
https://news.pn/ru/money/183881).
Mr. Horoian sent messages to work phone of NIBULON’s General Director with the following content, “I guarantee VAT refund if we lose to all the instances. We decided to return VAT in Ukraine and not have problems with it. It does not work that way. We can’t take a 100% risk of the Ukrainian government”. In this regard, the question arises: why one allows resolving the issues through the court? Can it be more effective to direct the efforts of Prometey Group’s teams to conduct economic activities within the current legislation? And then there will be no problems. 
Or such messages, “VAT is a global problem throughout the country and you know it. Don’t blame me. I will win the case at the courts with the tax agency on relationship with you. And I hope that there will be no claims. The state has no money. And each time one will find someone in order not to refund your VAT. We do not live in a law-based state, so I don’t invest money in Hroisman’s government”. Even here we can’t agree with Mr. Horoian. As experience of recent years shows, the state has money for VAT refund but only for those companies that comply with the law.
“(…) On Tuesday, I will call all the TV channels, including Channel 5, and they will go to them. If necessary, we’ll picket. This will shake them up quickly. The act will appear quickly and we will have what to appeal to the court with. Please do not stop payments. We can’t work without working capital …”.
“(…) Your company is in a fever. I do not want to work with you any more, you have a de facto accountant in charge of the company … Accounting department is not a profitable department but an expense item. The commercial department is a profitable one …”.
“(…) I propose you to pay. We will picket near your office. People do not receive salary because of your whims. A lot of dirt will come out; I suggest you not to disgrace yourself. Everyone will know that you can groundlessly not pay a supplier…”. The “dirt came out”… In other words, they decided that it was easier to “spread dirt”instead of establishing transparent accounting and proving the correctness of all Prometey Group’s operations.
As for Mr. Horoian’s assertion that “(…) you can groundlessly not pay a supplier”, we would remind you that we cooperate with more than 4,700 partners; we pay for the grain delivered ahead of time, on the second banking day and not on the third one as provided by a contract. Over the past marketing year, there were no cases of violation of the payment deadlines by our company. All our partners know this, so they trust us. Strict observance of contractual obligations, including timely settlements with suppliers, helps us to maintain the leading positions in the agrarian market of Ukraine and among exporters of agricultural products.
Trying to convince the public that they are right, Prometey writes, “If there is a problem with VAT refund procedure for exporter and all the terms have been violated for a long time, if NIBULON is accustomed to developing business within the law, then why not to file a suit? And to prove the right to VAT refund in court”. But we do not need to prove the right to receive VAT refund because we work transparently. You can easily verify this by reading the official website of the Ministry of Finance of Ukraine; the information on VAT refund to our company is published monthly there. By the way, if we analyze the history of the issue of VAT refund to companies in Ukraine, we can confidently say that this is the best year when those exporters who work within the current legislation receive VAT refund in time. We appreciate our reputation and work transparently, so our company receives VAT refund in time. The only exception is transactions with Prometey Group.
Thus, as of July 1, 2017, total amount of direct losses of our company is UAH 7,091,317 plus UAH 39 million of VAT that was not refunded. At the same time, our debt to Prometey Group is slightly more than UAH 2 million.
We are convinced that instead of provoking us to file suits against the state and to have legal proceedings for years, to blackmail and use psychological pressure, it would be much more effective and productive to sort out problems, admit their existence, to put the accounting in order, and then to pass all the checks in the tax authorities proudly holding their heads.  
In turn, Mr. Horoian as the ultimate beneficiary of Prometey Group should, first of all, take responsibility for conducting their activities strictly within the current legislation.  After all, he does not sign any documents on behalf of his companies. All the documents are signed by hired managers. Moreover, such companies often do not have accountants. How can you properly maintain accounting and tax accounting in this case? How can one trust such a partner and build business relations? Of course, everyone has the right to run his/her business in any way he/she sees fit, and we wish them success; but if there are violations in your companies, do not involve us in public proceedings.
Our company carries out a huge work on legalization of the grain market in Ukraine. We actually build modern facilities, bringing our services closer to agricultural producers. We not only regularly conduct explanatory work with individual producers but also officially work with them and pay taxes. We are happy that agricultural producers, including individual producers, chose us.  At the same time, Prometey, instead of doing the same things, is trying to blackmail us.
We stopped our cooperation with Prometey Group. If we are convinced that this company works only within the law and without violations, we will consider the possibility to renew cooperation.
If we consider the general situation in the grain market of Ukraine, it becomes obvious that the public discussion with Prometey does not mean that we want to demonstrate existence of such problems in one company. We just described the situation as it is. In fact, there are a lot of such cases. To avoid them, all participants of the grain market must struggle against such manifestations and prevent such situations.