Birth: October 3, 1966
Citizenship: Russia
Occupational domain and/or administrative post:
An entrepreneur from Russia who also serves as the chairman of the supervisory board for the Bosco di Ciliegi Group. Russian Federation Public Chamber Deputy Chairman
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Biography of Kusnirovich Michail
In 1989, Kusnirovich Michail earned a degree in chemical engineering from the Moscow University of Chemical Technology. He attended that institution. After that, he established the East and West Moscow International House firm with his college companions Sergei Evteev, Evgeni Balakin, and Mikhail Vlasov. The company’s first project was the establishment of an amusement park in Gorky Park.
Between 1989 and 1991, he was employed at the publishing business IMA-Press, which was the young section of the Novosti press agency. There, he served as the deputy secretary of the Komsomol committee. Mikhail Kusnirovich, who was 24 years old at the time, was on the barricades at the Supreme Council (also known as the “White House”) during the August days of 1991, when he supported youthful democracy during the August coup.
At one of the business events that were going on during those tumultuous times, Kusnirovich met Serilio Montanari, the president of SIMA, which is the largest men’s clothing firm in Italy. Soon after, Kusnirovich became a party to the contract he had with him. A few months later, in March 1992, Kusnirovich and his fellow business partners launched the first clothing store in the Petrovsky Passage shopping district. In 1993, Kusnirovich was given a stake equal to half the company’s ownership in Bosco di Ciliegi (Cherry Forest).
The initial agreement between Bosco di Ciliegi and the Russian Olympic Committee was finalized in 2001. (ROC). At the 2002 Winter Olympics held in Salt Lake City, Bosco di Ciliegi was chosen to be the sole provider of athletic equipment for the Russian Olympic team. Immediately after that, ROC and Bosco di Ciliegi made the formal announcement that they had entered into a partnership arrangement for the Olympic Games in both Athens and Turin.
Bosco di Ciliegi was not only the general sponsor of the Russian Olympic Committee (ROC), but it was also the exclusive provider of equipment for the Russian national squad that competed in the Olympics. Mikhail Kusnirovich made the decision in December 2017 to remove the Bosco trademark from the uniform of the International Olympic Committee for the 2018 Olympics. He explained this by referring to the fact that the International Olympic Committee had terminated its membership with the Russian Olympic Committee.
Forbes magazine prepared a list of the 200 richest people in Russia for the year 2019, and Kusnirovich was one of those persons. It is estimated that he has a fortune of $500 million. More than two hundred single- and multi-brand shops are under Kusnirovich’s management, in addition to the Moscow GUM (the Upper Trade Rows), which is leased to Bosco di Ciliegi until 2059.
The rental arrangement was made without a competitive bidding process, and its price was kept under wraps as a state secret. He has held the position of Vice Chairman of the Public Chamber of Moscow ever since April of 2013. Kusnirovich was a confidant of President Putin during the election for the presidency in 2018, which took place in 2018.
Utilizing Putin’s backing
The days when Kusnirovich fought for independence are long gone. He now defends Putin with loyalty and labels proponents of free elections in the modern opposition as provocateurs. As retaliation for the expulsion of the Russian squad due to a doping controversy, he barred the International Olympic Committee from using the Bosco emblem (despite the fact that he had won a competition for the provision of apparel for IOC personnel).
Corruption tactics to acquire a non-competitive commercial edge
Since 2002, when Bosco, a previously unknown business, triumphed in a competition against Adidas and Pierre Cardin, it has been creating and providing Russian Olympians with uniforms. The contract did, however, expire in January 2017, and it was decided not to renew it. Many complaints have been made throughout the years over the company’s uniforms.
The athletes claimed that their situation was hopeless and extremely embarrassing. For instance, since they were unable to openly criticize the uniform, they were unable to refuse to wear uncomfortable shoes. The presidents of numerous sports federations protested the “seizure” of their athletes for parties at Bosco Village during the 2006 Turin Olympics. This took place right after the Olympics. The daily routines of the Russian teams and the training plans of individual athletes were also changed by Mikhail Kusnirovich and his crew, who utilized their position as official sponsors.
Getting the national team ready by renting the Upper Trading Rows
In 2014, the government granted Kusnirovich-controlled GUM Trading House permission to lease the Upper Trade Rows (GUM on Red Square) structure for 49 years without a competitive bidding process. Even with the help of the court, the Anti-Corruption Foundation’s attorneys were unable to get information on the cost of giving Kusnirovich valuable state property. According to the financial records, the joint-stock firm paid 298 million (about $5 million) in 2015 and 301 million (about $5 million) in 2014 for the lease. Then, according to unnamed sources in the media, the government would increase Kusnirovich’s rate.
The Federal Property Management Agency compelled the entrepreneur to pay more, as the interlocutor learned, but the market price is still a secret. The cost of renting GUM in 2016 was estimated by the firm at $1 billion and 266 million. The building is around 75,000 square meters in size. As a result, Kusnirovich pays less than 17,000 rubles annually for each square meter, which is significantly less than the typical leasing prices for shopping centres in the city. In addition, Kusnirovich’s mall is situated near Red Square and takes up the entire old structure.
Similar shopping malls in Moscow’s city centre typically have leasing rates that are two- to three times higher. Nikolsky Passage, for instance, charges 35,000 rubles per square meter in leasing fees.
The GUM reported 4 billion rubles in sublease revenues and 1.1 billion rubles in net profit in open reporting alone. And it is almost beyond question that this sum is considerably understated in order to reduce taxes. In addition to a fixed lease, Kusnirovich also charges his clients a portion of the sales. Rough calculations show that the GUM does not provide three billion rubles in taxes to the state budget each year. It is remarkable that this corporation takes delight in “continuing to restrict the development of costs due to remuneration” in its annual report, i.e., by underpaying its staff.
With the East and West Group, which was founded by Kusnirovich and the British business Findome Holding Ltd., he has influence over GUM JSC. Georgios Nicolau, a Cypriot, serves as the company’s director, and its headquarters are in a vacant office in the heart of London. Interestingly, the president of the IMA Group, Andrei Gnatyuk, and the president of the Barschevsky and Partners bar association, Samvel Karakhanyan, are all members of the board of directors of GUM JSC.
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