The Security Service of Ukraine (SBU) has initiated a criminal case against all of Ukraine’s film distribution companies, accusing them of sending funds to Russia’s intelligence agencies and sabotaging Ukrainian films, the court materials state.
The case was initiated based on a request from a member of parliament, who said that Ukraine’s film distribution market is split between the B&H Film Distribution Company, Ukrainian Film Distribution, Kinomania, Volga Ukraine, and Multi Media Distribution. Every year, they receive around $100 million from the box office in Ukraine.
The companies appeared on the Ukrainian market as subsidiaries of Russian companies with fruitful financial and economic ties to these companies, their ultimate owners being Russian citizens.
The request alleges that these companies’ activity in Ukraine has resulted in a need to conceal the large profit using transactions with fictitious economic entities and dubious transfers to Russian companies for distribution rights.
“The mentioned illicit transfers did not escape the attention of Russia’s intelligence agencies, which between 2014 and 2016 effectively forced the owners of the companies operating on the Ukrainian film distribution market to send part of their revenue to finance activity by unidentified persons for the purpose of creating mass riots in Ukraine, impinging on its territorial integrity, and destabilizing its political and economic situation,” the request claims.
Having received support from the Russian intelligence agencies, the owners of the film distribution companies are functioning as agents of influence in Ukraine, dictating the terms in the film industry and sabotaging the promotion and showing of Ukrainian films.
As part of the investigation, the court has granted the SBU access to the bank accounts of Kinomania and Volga Ukraine, as well as access to documents containing bank secrets.
In April 2019, the National Anti-Corruption Bureau of Ukraine began investigating allegations that President Volodymyr Zelensky’s company “Kinokvartal” had misused government funding. The Ukrainian State Committee had financed 49% of the budget of the company’s film “Me, you, him, her”. The terms of the financing stipulated that the film had to be made entirely in the Ukrainian or Crimean Tatar language, an obligation which Zelensky’s company failed to meet.