While looking for Brexit opportunities: Jacob Rees-Mogg profits directly from Chinese pharma and Russian gas investments
The government’s new minister for Brexit opportunities, Jacob Rees-Mogg, is directly profiting from significant investments in a pharmaceutical company in China as well as a Russian gas company, according to reports.
Somerset Capital, in which Rees-Mogg holds a 12 per cent stake, reportedly invested £5.7m on behalf of clients in a company that potentially faces sanctions from the UK, EU and US, namely Russia’s largest privately owned gas company, called Novatek PJSC-GDR, which is chaired by Vladimir Putin ally Leonid Mikhelson.
Moreover, Somerset Capital has pumped £6.5m on behalf of its clients in the Chinese pharmaceutical and healthcare company WuXi AppTec, a firm that is likely to benefit directly from deregulation following the UK’s departure from the EU, according to the Daily Mirror.
WuXi acquired Oxford-based gene therapy company Oxgene in March of last year for a deal close to £100m.
Govt role vs investments
Experts have pointed out that Jacob Rees-Mogg holds a substantial stake in Somerset Capital, a multi-billion investment fund specialised in emerging markets, while at the same time he is now tasked with finding ‘Brexit opportunities’ in those same countries.
Rees-Mogg is a major shareholder in Somerset Capital, an investment firm he co-founded and focuses on investment projects across emerging markets and major economies.
He reportedly has a 12 per cent stake in the company, which will be reduced to 5 per cent by 2027 under the company’s profit-share scheme.
The CEO of Somerset Capital, Dominic Johnson, said earlier that Rees-Mogg has been a “sleeping partner” for years.
He pointed out that Rees-Mogg stopped taking a salary from Somerset when he joined the government in 2019, although he still is a partner and major shareholder.
Rees-Mogg, believed to be one of the richest MPs, reportedly took an £800,000 dividend from the firm in 2020 and another £600,000 in 2021.
Under parliamentary rules, he does not need to declare the exact amount, just that it is over £70,000, Open Democracy pointed out.
National security concerns
Labour’s deputy leader, Angela Rayner, has reportedly raised national security concerns about investments by Somerset Capital in both China and Russia.
“From Vladimir Putin’s puppets to private Chinese health corporations, Rees-Mogg’s investments raise serious questions about security,” Rayner said according to the Daily Mirror.
“Ministers cannot be allowed to influence policy decisions they have financial interests in and any conflicts should always be properly notified.”
Angela Rayner
Under parliamentary rules, he does not need to declare the exact amount, just that it is over £70,000, Open Democracy pointed out.
The ministerial code states that “ministers must ensure that no conflict arises, or appears to arise, between their public duties and their private interests.”
Ministers with shareholdings directly related to their roles are usually expected to either dispose of the shares, which, in Rees-Mogg’s case, could gain him a huge cash sum, or to put them into a blind trust.
It has been reported that Rees-Mogg’s new role largely replaces the Cabinet Office minister position previously held by Lord Frost, whose duties included “coordination of cross-government positions on trade issues”.