A Cyprus-registered company has been named by investigative journalists for its involvement in the transiting of Belarusian potash, subject to sanctions since March 2022.

The news was reported by Politico and the Organised Crime and Corruption Reporting Project.

Politico cited an ‘investigation’ carried out by BIC – a network of Belarusian investigative journalists in exile – claiming to have found that the Cypriot company, linked to a former top aide to Belarusian leader Alexander Lukashenko, is profiting through inflated contracts related to new export routes of the fertiliser ingredient potash. The new export routes were set up as a result of EU sanctions.

“In March 2022, the European Commission banned the import and transit of Belarusian potash in the bloc following Lukashenko’s support for the Russian invasion of Ukraine,” writes Politico.

“The EU ban forced Belarus’ state-owned potash maker Belaruskali to shift its roughly €2 billion-per-year exports from the Lithuanian port of Klaipeda to the Russian port of St Petersburg.”

The BIC itself said the new arrangements shifting the potash out of Russia involved heavily marked-up contracts between Belaruskali and a Cyprus-based holding company.

“In 2023, Belaruskali hired a Cypriot subcontractor called Dimicandum Invest Holding to transfer cargo from rail wagons to ships at the Russian port, even though the terminal operators could do the job far cheaper.”

BIC said it acquired documents showing that in 2023 Belaruskali agreed to pay the Cypriot firm $68 million for 3.4 million tons of potash – $20 per ton moved. The Cypriot outfit then paid the port to do the job. BIC said it had figures showing the port’s market rate for these services is $11 per ton.

“Our investigation has shown that this scheme may have been organised to divert funds from the domestic monopoly producer of potash fertiliser to the benefit of Aleksandr Lukashenko’s proxies,” BIC said.

The journalists found that the person listed as signing on behalf of Dimicandum Invest Holding was Andrei Svirydau, deputy head of the Belarusian Department of Presidential Affairs from 2019 to 2021.

“Svirydau admitted to being the company’s financial director to BIC reporters over the phone, but denied signing any contracts with Belaruskali.”

The EU has previously faced pressure for sanctioning Belarusian potash. UN Secretary-General Antonio Guterres travelled to Brussels last year to plead for a transit exemption for Russian and Belarusian fertilisers, arguing the bans were indirectly increasing food prices and hunger across Africa.

“Most EU countries led by Portugal, were willing to grant the special dispensation, particularly after complaints from agricultural powerhouses like Brazil that they were struggling to get enough fertiliser,” reports Politico.

“Yet fierce opposition from the Baltic states ultimately killed the idea, which was soon buried amid another round of sanctions against Minsk.”

The BIC journalists speculate “that a significant part of the [higher potash logistics] costs might be due to schemes with signs of corruption rather than the consequences of sanctions”.

Experts interviewed by the BIC said that even if the potash shipments did not enter the bloc, Cyprus-based Dimicandum Invest Holding has still violated EU sanctions.

Gunnar Ekelove-Slydal, deputy secretary-general of the Norwegian Helsinki Committee, told BIC that “EU sanctions prohibit companies registered in the EU from providing services or products to Belaruskali, and transshipping the potash in St Petersburg would be a direct violation.”

When contacted by the BIC, Cypriot law enforcement said the BIC’s findings “had been referred to the competent agency”.

The European Commission told Politico: “The Commission will look into this case and liaise with the Cypriot authorities if and as needed.”

Dimicandum Invest Holding, a private limited company, has its registered office in Nicosia. The Registrar of Companies website lists the firm’s director as one Galina Akritova Alexandrou.