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Paradise Papers: Wilbur Ross hits back after press coverage ‘reveals’ what the industry already knew

US Secretary of Commerce says he will “probably not” maintain his stake in Navigator

NEWS that US secretary of commerce Wilbur Ross has investments in shipping will come as little surprise to anyone in the industry.

Nor should it be a surprise to anyone else. Mr Ross disclosed his stake in Navigator Holdings to the US Office of Government Ethics when he was appointed to the position by President Donald Trump.

The news breaking from the release of the Paradise Papers leak this weekend, however, implies there is something nefarious in Mr Ross’s holding of shares, and formerly a board position, in a company doing business with a Russian company.

The issue comes from the fact that two executives at Russian energy company Sibur, including the father of Russian president Vladimir Putin’s son-in-law, have been sanctioned by the US government.

Sibur itself has not been sanctioned, and Navigator has been very open about the business it does with the company.

It has been public knowledge that Mr Ross, through his company WL Ross, owned a substantial holding in Navigator and took the company public in 2013, and that Mr Ross kept his stake in Navigator after he was sworn in as commerce secretary.

Regarding the company’s business dealings with Sibur, Michael Webber of Wells Fargo said: “Navigator’s exposure to Sibur was actually a focal point in their presentations, appearing prominently in their investor decks.”

As of Monday morning, Mr Ross appeared to be willing to divest himself of Navigator.

Mr Ross today told Bloomberg he would “probably not” maintain his stake in Navigator. “I’ve been actually selling it anyway, but that isn’t because of this,” Mr Ross said.

It is unlikely Mr Ross has broken the letter, or even the spirit, of the law in maintaining a stake in a shipping company doing business with another country. In America’s febrile political environment, however, connections to Russia can be politically challenging.

Sharing the titles of commerce secretary and shipping investor also creates a conflict of interest, as evidenced by Mr Ross’s own admission. A statement issued by the Commerce Department in response to the Navigator Gas and Sibur business dealings said Mr Ross “recuses himself from matters focused on transoceanic shipping vessels”.

With the majority of world trade, which Mr Ross’s government role is supposed to cover, being carried in ocean-going or “transoceanic” vessels, this would require Mr Ross to give up a large part of his job.

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