MOSCOW, September 3 (RAPSI) — The Commercial Court of St. Petersburg and the Leningrad Region has extended the insolvency process against Transaero airline, once Russia's second-biggest carrier, until March 1, 2022, according to the court materials.

A petition to extend the period of bankruptcy at the air carrier was submitted to the court by its bankruptcy trustee Alexey Belokopyt.

This May, the Thirteenth Commercial Court of Appeals confirmed the dismissal of the Transaero bankruptcy commissioner to bring PJSC Aeroflot Russian Airlines to subsidiary liability for the debtor's obligations.

As the court noted at that time, the arguments and circumstances referred to by Belokopyt had previously been repeatedly presented by the commissioner, nevertheless, after being examined had been rejected by judicial acts that had entered into legal force with respect to several disputes.

Thus, the decision said, actions carried out by Aeroflot to fulfill previously taken obligations of Transaero in the period from September to October 2015 were aimed to replenish the debtor's working capital for the transportation of the airline's passengers, including to pay for refueling aircraft, servicing aircraft, passengers and crews at airports, preventing a complete stop of Transaero's activities and suffering of even greater losses, the commercial court noted.

In its ruling, the court noted that Aeroflot company had never been an entity controlling Transaero, either within the framework of corporate relations, or within the framework of any other relations.

In October 2020, the commercial court satisfied an application of the Transaero bankruptcy commissioner as to bringing the former general director of the company Alexander Burdin to subsidiary liability for the obligations of the air carrier. The amount of subsidiary liability is to be determined upon completion of settlements with the airline's creditors.

The decision states that from November 16, 2015 to September 13, 2017, Burdin committed actions that significantly worsened the financial situation of Transaero and created conditions for a further significant increase in the disproportion between the value of the debtor's assets and the size of his liabilities. The court also indicated that a causal relationship existed between Burdin's illegal actions to evade the transfer of documents, material assets of the debtor and the impossibility of satisfying the claims of creditors. 

Moreover, the court is to decide on a statement by VTB bank seeking to recover 249.2 billion rubles ($3.4 billion) from the founder of the debtor Alexander Pleshakov, his mother, and ex-chairman of the board of directors Olga Pleshakova.

The Commercial Court of St. Petersburg and Leningrad Region declared Transaero air carrier bankrupt in September 2017. The airline was unable to service its debts, which, according to some estimates, make about 250 billion rubles ($3.4 billion). The company has not operated flights since October 26, 2015.

Burdin acted as Transaero CEO from late 2015 to September 2017 and headed the company after revocation of the air carrier’s flying license.

On August 28, 2018, a Moscow court arrested Burdin in absentia, he was put on the international wanted list. Burdin stands charged with failure to pay wages, pensions, scholarships, benefits and other payments for more than two months, embezzlement committed by an organized group or in an especially large amount, and abuse of office, which entailed grave consequences.

According to investigators, ex-Transaero CEO has embezzled over 1.3 billion rubles (about $17.5 million) and has not paid wages to employees for well over two months. As a result, a salary debt to nearly 7,000 employees reached about 400 million rubles ($5.4 million). The defendant has pleaded not guilty.

Besides, in August 2020 a Moscow court sentenced former Transaero bankruptcy manager Mikhail Kotov to 5.5 years in a general regime colony in a criminal case over embezzlement of the airline's property in the amount of over 1 billion rubles ($13.5 million). The ex-manager was also found guilty of abuse of office.

Kotov’s action resulted in embezzlement of the airline’s property worth over 1 billion rubles ($15.3 million). Moreover, he forged some documents to suppress crimes allegedly committed in conspiracy with the former Transaero CEO Alexander Burdin, the statement reads.