Top stories in the Russian press on Monday, August 12, prepared by TASS

Izvestia: EU to deny visas to Donbass residents holding Russian passports

The European Union (EU) is working on recommendations for its member countries on identifying and possibly rejecting Russian passports issued to the residents of Donbass, the press service of the European Commission (EC) told Izvestia. Brussels is extremely concerned about Moscow’s decision to begin its streamlined issuance of Russian citizenship to the residents of the Donetsk and Lugansk regions, and believes that the move undermines the spirit and goals of the Minsk agreements, the newspaper wrote. Thus, the European Union is ready to take measures, going as far as not recognizing the documents. However, according to the EC's press service, the final decision on recognizing these passports would be in the hands of the member countries.

In turn, the Polish Foreign Ministry told Izvestia that "all members of the European Union" are actively involved in the discussion. The Baltic states have already announced their intentions to not accept the documents. The Foreign Ministries of Latvia and Lithuania told the newspaper that they would deny Schengen visas to "new" holders of these Russian passports even without the EU adopting a unified decision.

Moscow views this position as "extremely hypocritical" and hopes that "common sense will prevail in the EU." When speaking to Izvestia, Chairman of the Russian Federation Council’s (upper house) Foreign Affairs Committee Konstantin Kosachev lambasted the EU for putting territory over people. "Let's see if the EU has enough common sense and responsibility for what is happening, where people and their interests, rather than some geopolitical structures, should still be at the center of attention," he said.

Vedomosti: Moscow protests point to widening chasm between government and the public

Saturday's Moscow rally against the lack of opposition candidates to the City Duma elections and against police brutality at peaceful rallies became the largest mass protest in the Russian capital since the winter of 2011-2012, Vedomosti wrote. According to a non-profit association of volunteers, around 60,000 people came to the protest, while the Ministry of Internal Affairs reported 20,000 participants. According to Vedomosti, at the moment, the rallies are primarily held in and concern Moscow, although they are based on a larger, growing demand by society for better participation opportunities in politics.

At the moment, the protests are primarily focused almost exclusively on the Russian capital, political analyst Mikhail Vinogradov told Vedomosti. So far, the situation, according to the expert, is dead-locked. "The latest rally did not offer a clear strategy of action, but the notion that the authorities had that everything would be resolved by itself or that the protesters could be able to be effectively demoralized through repression is merely an assumption," he said.

The protests have not died down, because they are based on mounting demands by the public to bolster participation in politics, according to political strategist Sergey Polyakov. "The denial to register independent candidates was perceived by society as a denial of the right to be heard," he told the newspaper, adding that if the authorities do not heed this request, the protests will increase.

According to political analyst Abbas Gallyamov, over the past two months, the demonstrations have only grown, which indicate its fundamental nature. "Its reasons are not situational - this is not a short-term outburst of emotions, but a deep internal contradiction between a large social group and political institutions that do not satisfy this group," the expert told Vedomosti.

So far, international analysts believe that the Moscow protests do not yet affect the overall domestic political situation, the newspaper wrote. Fitch experts, increasing Russia's rating from BBB-to BBB on Friday, wrote that the increased public activity and willingness to protest remained localized and did not lead to forming a nationwide political movement

Izvestia: Chinese carmaker abandons production in Russia

China's third largest automaker Changan refused to jointly produce automobiles at a plant in Russia's Lipetsk Region, Izvestia wrote. Sources told the newspaper that the company might have been influenced by recent litigation troubles of another Chinese car manufacturer in Russia. At the same time, experts told the newspaper that despite this, the Russian market remains attractive to automakers, so Changan might look for a new partner in Russia.

The Chinese auto producer began manufacturing cars at the plant in 2016, starting off with its compact crossover the Changan CS35. "As for the CS35, there are about 300 vehicles left in the warehouse in Lipetsk. As far as I know, they will be sold and more cars will not be brought from there. All new vehicles will be shipped from China," a source at one of Changan's official dealerships told Izvestia.

"We no longer manufacture anything in Russia, all of our cars are Chinese assembled. Yes, there used to be a factory, but now all the automobiles come from China, completely Chinese-made," an employee of the company confirmed to Izvestia.

Earlier, another Chinese carmaker, Great Wall, lost a lawsuit in a Russian court against a bankrupt distribution company. Great Wall accused its Russian partners of misappropriating $50 mln for products delivered in 2014. This story may have influenced Changan’s decision to abandon its joint venture with the Russians, sources told Izvestia.

According to experts, Changan might look for other partners as the Russian car market remains attractive. Automotive expert Sergey Ifanov believes that the company might get an assembly contract at Avtotor. "For them, this is a chance to nullify the recycling fee and customs payments in exchange for contract deductions for the Russian company. But they will be able to offer a competitive price," the expert told Izvestia.

Kommersant: Russia in hot pursuit of frequencies for 5G networks

Due to a lack of frequencies, Russia might go with 4.4-4.99 GHz as the key range for creating 5G networks. According to Kommersant, the frequency is unpopular in most countries, except for China and Japan. The Russian government expects to make up for the shortage of foreign equipment and smartphones for this range at the expense of domestic industry. Experts told the newspaper, this scenario threatens to increase the cost of equipment, delay the 5G network’s construction, and cause problems for roaming.

The entire industry is focused on 3.4-3.8 GHz, so the choice of 4.4-4.99 GHz frequencies as the priority for 5G is associated with the risk of "lagging behind in progress", the Ministry of Communications said. However, the government agency now plans to work with Russian manufacturers of telecommunications equipment, according to a ministry representative. At the same time, the Ministry of Industry and Trade reported that they are creating a consortium, which will include both software and hardware developers, as well as those manufacturing electronic component base.

Telecom operators criticized the idea of the Ministry of Communications. According to them, the solution will delay the objective and raise construction costs, and there is no equipment on the market operating in the 4.4-4.9 GHz range, since these frequencies are not in demand globally for 5G networks. Given the current state of the Russian electronics industry, establishing the entire range of domestic 5G equipment in a full cycle in the coming years, regardless of the frequency, seems unlikely, a source in one of the federal operators told Kommersant.

Kommersant: Sberbank denied new benefits for its oil venture

The Russian Ministry of Energy and the Ministry of Finance rejected a request by Sberbank CEO Herman Gref for additional benefits for Russia's largest independent oil refinery Antipinsky, owned by a joint venture of the bank and industry investors, Kommersant wrote citing its sources. In addition, the Federal Antimonopoly Service (FAS) and the Ministry of Natural Resources criticized Gref’s request to amend the conditions of the licenses for deposits on the balance sheet of the refinery.

"The relevant ministries gave negative feedback on the request of Sberbank CEO Herman Gref for additional tax benefits for the Antipinsky oil refinery and for changing the terms of the license for the deposits in the Orenburg Region," the newspaper wrote.

According to the paper, in July, Gref wrote a letter to Russian President Vladimir Putin, in which he asked to increase the reverse excise tax on oil paid from the budget for the refinery. However, the Ministry of Finance opposed such benefits, as it would lead to a budget revenue loss of 24 bln rubles ($367.52 mln) per year by 2024, when the tax maneuver is completed. The Ministry of Energy also did not support the initiative, since it "does not contain a financial and economic justification." FAS supported the Ministry’s position, sources told Kommersant.