Moscow on Thursday threatened foreign companies that would either stay in Russia or be forced to hand over the keys.
“Regarding those who are considering closing, we must act decisively,” President Vladimir Putin said during a meeting with the Russian government. Hundreds of companies have announced the suspension of activities in this country since its start invasion of ukraine.
“There is no way we can allow local suppliers to be harmed. You have to introduce external management and then transfer these companies to those who really want to work,” Putin continued, according to reports the FinancialTimes.
The head of the Kremlin also believes that “it is not even necessary to act arbitrarily”. “There are enough legal and market instruments; we will find legal solutions,” he added.
Putin, however, advised to respect the rights of foreign investors who wish to stay and to protect those who continue to work in Russia. Admitting that the sanctions had an impact, he was confident that the Russian economy would adjust over time. And he claimed that Russia would have been subject to sanctions even without a war in Ukraine, also guaranteeing that the country would continue to meet its contractual obligations in the supply of energy, reports the same English newspaper.
More suspensions than outings
The world of brands has a “exodus” of international companies From Russia. THE list compiled by the Yale School of Management (USA) is updated every hour and already has more than 300 names, but it shows that few have already decided to leave the country.
Among those leaving are consultants such as Deloitte, Accenture, KPMG. The Kering group, owner of a luxury empire, has just ordered the closure of stores. However, the most of the names on this list have chosen to suspend their activity, whether commercial or productive, in whole or in part.
For Moscow, however, these are economic reprisals to which it must respond. The Ministry of Economy will already have drafted guidelines for a degree that will allow Russia to temporarily take control of companies with more than 25% of the capital in foreign hands and which refuse to work.
According to this proposal, reported by Bloomberg, the Russian state would enter at the request of the companies themselves: directors representing the capital held by Russians would ask a court to appoint external managers, the court could then freeze the shares held by foreigners, as a measure to preserve ownership of assets and protect workers.
The external managers could come from the Russian development bank VEB.RF (owned by the State), according to a source from the Russian Ministry of Economy quoted by this agency.
The owners of these companies would then have five days to resume activity or choose another outcome, such as the sale of the shares. The Ministry of Economy therefore suggests that the priority is to convince foreigners to sell assets and not so much nationalization. Although he points out that “the purpose of this law is to encourage organizations under foreign control to maintain their activities on the territory of the Russian Federation”.
But former Russian President Dmitry Medvedev hinted that the most extreme scenario was also on the table. “The Russian government is already working on measures that include the bankruptcy and nationalization of assets” of foreign companies that forced him out, Medvedev said in a post on Russian social network VK.
Medvedev calls the corporate exodus a “stupid decision”, accusing “closed-minded Russophobes” of not caring about the consequences. “People in Europe and Russia can lose their jobs and income for stupid decisions that run counter to common sense,” the statement read. long post in which he promises: “We will answer this harshly.”
Medvedev also invoked the Russian will to impose on the West “sanctions symmetrical” to those imposed on the Russian economy and considered “just and objective” the legislative intervention which will allow Moscow to take charge of the assets likely to be abandoned by “managers in panic” and who “yield to the pressures” of Western governments.
In the text that ends with an ironic greeting to one of the companies that suspended their activity (“Hello, McDonald’s“), Medvedev also claims that whoever leaves now “will take a long time” to return to the Russian market.
There are also those who remain
On Yale’s list, there is at least one company with Portuguese connections. This is Farfetch, named as one of those who have suspended shipping orders. Among the companies that have closed, suspended their activities/sales or stopped new investments, the list includes well-known multinationals such as Ikea, Renault, Philip Morris, Puma, Rolls Royce, Scania, LVMH, Lego or Levi Strauss, Alcoa, Apple or BlackRock and JP Morgan. This, in addition to many other names that have become public, including sectors as diverse as technology and consumer electronicsoil/energy and financial services.
But Yale also listed a few dozen companies that remain in Russia and have “significant exposure.” Examples include Accor, Marriott and Intercontinental hotels, Haliburton, Herbalife, Pirelli, Schlumberger, Citi, Cloudflare, Ferragamo and Subway, to name a few.
Burger King, McDonald’s big rival in the fast foodwas still on this second list, but around 5 p.m. in mainland Portugal, it was learned that this multinational has decided to stop supporting businesses to the 800 franchisees it has in Russia.