November 5, 2003	Wednesday	Ramazan 9, 1424

MOSCOW: Russian businessmen may have to take their orders from the state after the arrest of Mikhail Khodorkovsky, the nation’s richest tycoon, billionaire financier George Soros was quoted as saying on Tuesday.

“Russia may now be entering a phase of state capitalism, where all the owners of capital realise that they are dependent on the state,” Soros told Yevgeny Kiselyev, editor of Moskovsky Novosti, a weekly acquired recently by Khodorkovsky.

Khodorkovsky, former head of Russian oil major YUKOS, was arrested at gunpoint 10 days ago and charged on seven counts of fraud and tax evasion.

“Persecution of Khodorkovsky... sends an unmistakable message, that nobody can be independent of the state,” Soros said.

Khodorkovsky stood down as YUKOS chief executive on Monday after prosecutors froze his shares in the company last week, effectively preventing him from negotiating their sale to another company.

The assault on Khodorkovsky and some of his associates, who make up a group of core shareholders in the company, is widely believed to have been orchestrated by Kremlin hardliners apparently alarmed by Khodorkovsky’s political ambitions.

“I believe that he acted within the constraints of the law in supporting political parties. I am doing the same in the United States,” said Soros.

Accusations against Khodorkovsky, which have their roots in a selloff of state assets at bargain prices in the 1990s, could be levelled against any of the so-called “oligarchs” who have enriched themselves since the fall of the Soviet Union in 1991.

“Since practically everybody in Russia broke the law during the turbulent years following the collapse of the Soviet system, the Russian president can prosecute whoever he chooses,” said Soros.

—Reuters