Outsize-cargo airline Volga-Dnepr has suspended funding completion of the Antonov An-124-100M Ruslan freighter at the Aviastar factory in Ulyanovsk in Russia over a dispute with regional authorities, which resulted in the local government recently seizing the aircraft. Volga-Dnepr is now considering moving from Ulyanovsk to escape alleged interference from the local government.

The seizure broke an agreement reached between the federal and local authorities last month, when the Ulyanovsk regional government, under pressure from the Kremlin, promised to stop using local courts to interfere with Aviastar.

According to Volga-Dnepr, the disagreement began when the founder of Aviastar shareholder Sirocco, Egyptian Dr Ibrahim Kamel, allegedly refused to bribe Ulyanovsk bureaucrats and businessmen in exchange for their loyalty and non-interference with Aviastar.

These actions have paralysed Aviastar and forced Sirocco to stop financing five Tupolev Tu-204-120s which were ordered from Aviastar by two Chinese carriers.

Volga-Dnepr is considering "another region with a better business and investment climate", says the airline's director for external relations Dmitry Stolyarov.

He says Volga-Dnepr is known as a Russian company with "a clear accounting system and good business reputation," and adds: "We are moving from Ulyanovsk in order to preserve these qualities."

A move from Ulyanovsk may involve revising an investment agreement with International Finance under which Volga-Dnepr recently received a $29.9 million loan for completion of a Ruslan at Aviastar.

Source: Flight International