Grisha Balasanyan

Customs Mix-Up Costs Armenia’s Taxpayers 153,000 Euros

Waagner-Biro Stage Systems, a division of the multi-national Waagner-Biro, based in Austria, was given the job of refurbishing Yerevan’s Spendiaryan National Opera and Ballet Theater and the Aram Khachaturian Concert Hall.

In 2013, the Armenian government decided to allocate 4.336 billion AMD (US$9.049 million) for the job. Some 3.5 billion AMD came in the form of loans.

In October 2011, Armenia’s Ministry of Culture presented the government with an estimated price list for the work totaling 8.969 million Euros. The money would go to purchasing lights and stage equipment, for renovations, consultations, etc.

According to Armenia’s Control Chamber, an 8 million Euro contract was signed on March 27, 2013 between the Armenian Ministry of Culture and Waagner-Biro Stage Systems, SALZBRENNER STAGETEC Audio Video Mediensysteme GmbH), Electronic Theater Controls and the Armenian Artstek Ltd. Work was only completed at the Spendiaryan Theater and no changes were made to the laws of the contract.

The Control Chamber goes on to report that Armenia signed a loan deal with the Austrian Raiffeisen Bank International in order to finance the project. Armenia would get an 8 million Euro loan and it was envisaged that the two halls would be refurbished with the money. It was a 9.5-year loan at 1% annually.

According to a statement presented by the ministry, it was decided, after lengthy consultations, to only refurbish the Spendiaryan Theater but to bring the space up to international standards. Thus, the abovementioned contract was drafted and signed.

According to the contract, Waagner-Biro would assume the job of supplying and installing stage equipment, and teaching local staff how to use it all, and get paid 5.095 million Euros.

SALZBRENNER would do the same for sound equipment for a payment of 1.223 million Euros.

Lightening equipment would be handled by Electronic Theater Controls for 871,600 Euros.

For installing and uninstalling some equipment and getting stage conditions up to international standards, Artstek would receive 809,300 Euros.

The Control Chamber confirms that the companies were paid and were obligated to finish the work by February 28, 2013.

It turns out that the work was finished a month late, on April 8. In addition, 144,400 Euros worth of sound equipment reached Armenian customs on February 6, 2013 and left customs on September 23, 2014. 636,200 Euros worth of sound equipment imported to Armenia on January 1, 2013 left customs just 15 days later.

The most amazing part of all is the Armenia’s Ministry of Culture signed off on receipts stating that it had received and installed the above equipment, and that it was working fine, when the items were still in customs.

The ministry told the president of the State Revenue Committee that the bills of lading provided by the suppliers were inaccurate and provided a correct copy.  

Because of the “mix-up” the Ministry of Culture had to pay 82.829 million drams (153,000 Euros) in customs fees (the amount included 35.319 million in penalties) on the sound equipment worth 144,400 Euros.

On September 18, 2014, the government forked over the 82.829 million drams to the culture ministry to pay the customs fees and fines.