Identifier
Created
Classification
Origin
08YEREVAN261
2008-03-25 13:58:00
CONFIDENTIAL
Embassy Yerevan
Cable title:  

REGIONAL PRO-OPPOSITION TV STATION HOLDS TELETHON

Tags:  PGOV PREL PHUM KDEM AM 
pdf how-to read a cable
VZCZCXRO3997
PP RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHYE #0261/01 0851358
ZNY CCCCC ZZH
P 251358Z MAR 08
FM AMEMBASSY YEREVAN
TO RUEHC/SECSTATE WASHDC PRIORITY 7288
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RUEHLMC/MILLENNIUM CHALLENGE CORPORATION WASHINGTON DC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RHMFISS/HQ USEUCOM VAIHINGEN GE//ECJ4/ECJ5-A/ECJ1/ECJ37// PRIORITY
C O N F I D E N T I A L SECTION 01 OF 03 YEREVAN 000261 

SIPDIS

SIPDIS

DEPT FOR EUR/CARC, NSC FOR MARIA GERMANO

E.O. 12958: DECL: 03/24/2018
TAGS: PGOV PREL PHUM KDEM AM
SUBJECT: REGIONAL PRO-OPPOSITION TV STATION HOLDS TELETHON
TO PAY OFF TAX LEVY

REF: A. 07 YEREVAN 1446


B. 07 YEREVAN 1362

C. 07 YEREVAN 1338

D. 07 YEREVAN 1335

YEREVAN 00000261 001.2 OF 003


Classified By: CDA Joseph Pennington, reasons 1.4 (b/d).

-------
SUMMARY
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C O N F I D E N T I A L SECTION 01 OF 03 YEREVAN 000261

SIPDIS

SIPDIS

DEPT FOR EUR/CARC, NSC FOR MARIA GERMANO

E.O. 12958: DECL: 03/24/2018
TAGS: PGOV PREL PHUM KDEM AM
SUBJECT: REGIONAL PRO-OPPOSITION TV STATION HOLDS TELETHON
TO PAY OFF TAX LEVY

REF: A. 07 YEREVAN 1446


B. 07 YEREVAN 1362

C. 07 YEREVAN 1338

D. 07 YEREVAN 1335

YEREVAN 00000261 001.2 OF 003


Classified By: CDA Joseph Pennington, reasons 1.4 (b/d).

--------------
SUMMARY
--------------


1. (SBU) SUMMARY: The embattled, Gyumri-based GALA TV
station continues to fight for survival, hoping supporters
will help it raise the USD 82,000 in fines levied last
October in apparent political retaliation for airing footage
of opposition presidential candidate Levon Ter-Petrossian.
After a Gyumri administrative court ruled March 19 in favor
of the Armenian tax service's charges that GALA evaded taxes,
the independent TV station launched a fund-raising telethon
the same day. During the seven days of the telethon, and in
spite of a public appeal by Gyumri's mayor not to help the
station, GALA has raised 96 percent of the assessed taxes and
penalties so far. Over 3,000 donations have reportedly been
made by 10,000 people, in Armenia as well as from abroad. An
arson attack against one of GALA's leading supporters
followed the launch of the telethon. END SUMMARY.

--------------
PAY UP, GALA
--------------


2. (SBU) On March 19, the administrative court of Gyumri --
Armenia's second most populous city -- upheld a complaint
filed by Armenia's State Tax Service that the parent company
of the independent GALA TV station had evaded taxes, and so
ordered the payment of 25,619,034 Armenian Drams (AMD)
(approximately USD 83,000) in alleged back taxes, late fees,
and penalties. GALA balked at the tax evasion charge, as did
many of its civil society supporters, and characterized the
state's pursuit of GALA as politically motivated.


3. (SBU) Reftels documented the controversial October 2007
tax audit of GALA and its parent company, noting that the
head of the tax service had publicly mentioned violations
even before tax auditors launched their inspection. (NOTE:
GALA'S owner told us in February that an Embassy visit to his

station during the audit probably helped end it shortly
thereafter. END NOTE.) The attack on GALA is widely viewed as
retribution for its coverage of the presidential political
campaign of ex-President Levon Ter-Petrossian (LTP). GALA has
managed to stay on the air in spite of its legal
difficulties, thanks largely to the independent means of its
owner who was forced to bankroll the station when advertisers
pulled their ads in response to the controversy.

-------------- --
OK, WE WILL, AND EVEN THE BAD GUYS ARE DONATING
-------------- --


4. (C) The March 19 administrative court ruling went into
force immediately, but GALA's parent company has three months
to appeal the decision in a higher court. We are told the
station also plans to appeal the decision at the European
Court of Human Rights (ECHR),if necessary. By the close of
business on March 24, judicial enforcement authorities had
already collected approximately USD 50,000 of the raised
telethon donations, and gave GALA until the close of business
on March 25 to raise the remaining sum. In the event they do
not raise the remainder in time, GALA could be forced off the
air and its property confiscated for sale at auction. GALA
representatives told us March 25 that U.S. contributors to
the telethon fund were complaining that their bank transfers
had been held up inside Armenia, and had not reached GALA's
bank account. GALA said it was concerned the GOAM could be
abusing its legal right to put a hold on transfers made for
purposes of money-laundering or of checks to finance
terrorism.


5. (C) Levon Barseghian, director of Gyumri's Asparez Press
Club and the Gyumri civil society leader who has spearheaded
GALA's public efforts to stay on the air, told Emboff March
24 that even judicial enforcement personnel -- in the act of
serving papers -- took the opportunity personally to donate
5,000 AMD (roughly USD 16) each to GALA's telethon fund.
GALA TV is also fighting another court battle with the
Mayor's office of Gyumri over the TV-tower that Gala has used
to broadcast its signal. The Mayor says GALA has illegally

YEREVAN 00000261 002.2 OF 003


used the tower, and ordered GALA to pay for its retroactive
use. GALA's owner says the sum the Mayor is requesting is
exorbitant, and just one more tool the authorities are using
to drive GALA off the air. A legal ruling on the TV tower is
expected March 28. According to Barseghian, GALA has
subsequently received offers from villages in the outlying
Shirak region to post its transmitters free of charge in the
event they lose their legal battle with the Mayor's office.
(COMMENT: The mayor's contention that GALA has illegally
used the television tower is probably correct. Indications
suggest that GALA probably bribed petty officials some years
ago to turn a blind eye to GALA's use of the tower. However,
the legal status and rightful ownership of the Soviet-era
broadcast tower has been murky for many years, and it also
strains credulity to believe that Gyumri officials have not
long been fully aware of this usage. END COMMENT.)

--------------
GALA NOW A PUBLIC ISSUE
--------------


6. (C) Levon Barseghian told Emboff that GALA anticipated it
would lose the politically-motivated tax evasion charge, and
decided to hold a telethon even before the announcement of
the March 19 ruling. According to GALA, the telethon has
elicited support and donations from people both inside and
outside Armenia. RFE/RL reported that some donors made
in-kind contributions in the form of books or works of art,
authorizing GALA to raise money through their sale. Leading
opposition members of parliament have appeared for live
telethon interviews and donated money themselves. (COMMENT:
It has come to our attention that many of our own locally
employed staff have contributed to the telethon, as have a
number of our civil society contacts in Yerevan. This seems
representative of a prevailing public view among Yerevan's
intelligentsia that GALA is the victim of a
politically-motivated effort to drive them out of business,
and many Yerevantsi seem to view helping GALA as a concrete
gesture of opposition to the government's heavy-handed ways.
END COMMENT.)


7. (U) GALA's owner Vahan Khachatrian told RFE/RL that he
initially opposed such fund-raising, but bowed to pressure
from supporters once he realized GALA had become a public
issue that concerned the wider Armenian public. GALA says it
now considers itself to be a true public television outlet
since dropping commercial advertising and depending on public
support to remain afloat. At the opening of business on March
25, GALA had raised approximately USD 79,824.

--------------
MAYOR INADVERTENTLY SPURS DONATIONS
--------------


8. (SBU) During a March 20 evening program on Shant TV,
another Gyumri-based TV station with national viewership,
Gyumri Mayor Vardan Ghukasian urged the public not to help
GALA, asserting that the pro-LTP Armenian National Movement
party had already provided to GALA money to cover the tax
levy, and that GALA was now cheating the people out of more
money. The mayor's statements apparently unleashed an uproar,
with people calling into the live telethon broadcast to
repudiate the mayor, offering new donations or upping
previous contributions. Barseghian told Emboff that many of
the people donating were doing so to show their opposition to
the mayor who has been dogged by corruption allegations. He
is also the head of the local branch of the ruling Republican
party led by President-elect Serzh Sargsian.

--------------
PRESIDENT-ELECT WEIGHS IN?
--------------


9. (C) Levon Barseghian alleged to Emboff that
President-elect Serzh Sargsian sent an emissary with an offer
to GALA five days before the March 19 ruling. The emissary
offered the GOAM's dropping of the entire case in exchange
for a public letter from GALA requesting the President-elect
forgive its tax debt. GALA's owner declined the offer, saying
he intended to raise the money publicly, even if that
resulted in the eventual closure of the station.


10. (C) Barseghian told Emboff that in addition to the tax
penalty, police had begun a criminal case into the alleged
tax evasion. He added that it remained unclear how the case
would proceed after the paying of the back taxes and
administrative penalty, but feared it represented yet another

YEREVAN 00000261 003.2 OF 003


pressure tactic by the authorities to pursue GALA. Barseghian
said GALA's owner was firm in his resolve to fight on every
front, and that he was prepared to take the criminal case as
well to the ECHR.

--------------
ARSON ATTACK ON ASPAREZ PRESS CLUB CAR
--------------


10. (SBU) The Asparez Press Club (APC) president's car was
attacked by arsonists at approximately 1:00 am March 21 in
the press club's parking lot, just after fellow APC official
Levon Barseghian drove it back from appearing at the
telethon. APC security guards witnessed two individuals
fleeing the scene after apparently just having set the blaze.
According to Barseghian, police who arrived on the scene
initially doubted the source of the fire as arson, positing
it could have resulted from an electrical short, but they
eventually launched an arson investigation after confirming
the presence of gasoline on both ends of the vehicle. APC
responded to the arson attack by announcing a reward of two
cars of a similar model (Opel Vectra) to the one that was
destroyed, to any policeman who solves the crime. Arson
attacks are not foreign to Asparez; on January 18 the window
of their Gyumri office was set on fire by unidentified
assailants.

--------------
COMMENT
--------------


11. (C) In the latest skirmish between GALA and the
authorities, GALA's creative public relations maneuvering
appear to have given it the upper hand, at least for now. The
administrative court ruling has resurrected the pre-election
case -- latent during the election period -- which continues
to smell like an assault on independent media. We have said
before that GALA's owner is no angel. His PR adviser and
civil society ally Levon Barseghian is personally known to us
as a respected advocate for media freedoms, albeit perhaps
now one of pro-LTP political bent. Once again the authorities
seem to have underestimated the public backlash that its
pursuit of GALA continues to generate. END COMMENT.

PENNINGTON