Russia Expands Crackdown on European Companies and Assets Over Ukraine War
Russia Targets European Firms Amid Ongoing Ukraine Conflict
MOSCOW, Sept 29 (Reuters) - Russia has singled out European firms in its latest drive to strip foreign owners of the right to manage their Russian assets, government and company sources said, with the Kremlin accusing the European Union of involvement in the war in Ukraine.
Recent Seizures and Government Statements
Russia placed the assets of Swiss food giant Nestle, German wholesaler Metro AG and French retailer Auchan under temporary management this month.
"The time has come for asymmetric measures. Let them think about what measures they are taking and what sanctions they are introducing," a senior government source with direct knowledge of the measures told Reuters.
Asked which companies might be the next targets and whether the Russian units of Italian bank UniCredit and Austrian lender Raiffeisen could be placed under temporary management, the source, who spoke on condition of anonymity, said: "Let them be scared."
Impact on European Businesses in Russia
A Russian corporate source, who also spoke on condition of anonymity, accused European firms of deliberately stifling the development of their Russian units, ultimately harming the Russian economy.
A senior manager with a European company, part of a shrinking community of foreign businesses operating in Russia, told Reuters that European businesses expected the status quo to be maintained in the immediate future.
Kremlin’s Justification and EU Response
The Kremlin said on Tuesday the decisions were driven by "the increasing level of involvement of these unfriendly countries in direct battlefield hostilities" against Russia, but suggested the moves were "reversible".
"For now, we do not see any grounds for a reversal. We do not hear any reasonable voices calling for dialogue or for efforts to rectify the situation," Kremlin spokesman Dmitry Peskov told reporters.
The EU blames Russia for the failure to end the war, saying Moscow shows no real intent to engage in genuine peace talks, and last week renewed sanctions on more than 3,000 individuals and entities. It did not immediately comment on Russia's latest moves against European companies.
Accusations and Economic Measures
Allegations of European Military Involvement
WAR WAGED BY EUROPE
Peskov gave no evidence or details of how European countries were involved in military operations. Russian officials have previously cited weapons supplies, including the manufacture of drones in the EU, as well as the provision of targeting and intelligence information.
"If you acknowledge that your weapons are being used against us, and we are shooting them down, call it whatever you want, but I have no doubt that this is a war being waged against us by Europe," Foreign Minister Sergei Lavrov said on Tuesday.
Sanctions and Asset Freezes
Russia also criticises the EU for freezing about €210 billion ($238 billion) of its sovereign assets in response to the war and for targeting assets belonging to Russian companies in Europe and other Western countries.
The EU, a staunch supporter of Ukraine during the more than 4-1/2-year-old war, has accused Russia of carrying out attacks on European territory, while some government and intelligence officials have raised the prospect of a future Russian invasion. Moscow has denied the accusations.
Broader Impact on Foreign Businesses
Seizure of Foreign-Affiliated Firms
Since the start of the war, Russia has introduced temporary administration at 135 firms affiliated with foreign companies, the vast majority of them from EU countries, including French food group Danone and Danish brewer Carlsberg, according to data compiled by Russian news agency TASS.
Prior to the latest moves, Russian law firm NSP put the number of affected Western firms at 22. In its latest annual report, the Association of European Businesses said it had 330 member companies with operations in Russia, down from 400 a year earlier.
US Companies and Ongoing Business Relations
American Firms in Russia
No major US company has been targeted by similar measures, although some smaller firms, such as US private equity fund NCH Capital, whose Russian business includes agricultural assets, have also been placed under temporary administration.
The American Chamber of Commerce in Russia put the number of US companies still operating in Russia at around 300 this year. Russia and the United States have been in discussions on business opportunities once peace is restored in Ukraine.
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(Reporting by Reuters; Writing by Gleb Bryanski, Editing by Timothy Heritage)