Putin Seizes €532m Assets

Russian President Vladimir Putin has signed a decree ordering the compulsory seizure of Russian assets belonging to five European companies. The five companies affected are Tarkett, Kappa Rus, Ontex RU, Eviosys Packaging Kuban, and Menshen Packaging CIS.

The combined annual revenue of the five companies exceeds 50 billion roubles, equivalent to €532 million. The assets of the five companies have been placed under the interim control of a management company called Centre Capital, whose chief executive is Marat Mirkhaydarov, former head of the administration of the regional governor of Zabaykalsky.

All five companies continued operating in Russia after the country's full-scale invasion of Ukraine in February 2022. This move is part of Russia's ongoing crackdown on foreign-owned assets in the country, which has been described as unlawful expropriation by Western governments and international legal experts.

## What changed A presidential decree signed in April 2023 established the mechanism for such seizures, authorising the imposition of temporary administration over certain Russian assets of foreign companies. The latest seizures follow a series of similar moves in September, when Putin placed the Russian assets of several other European companies under temporary administration.

## Why it matters The seizure of these assets is a significant escalation of Russia's crackdown on foreign-owned assets in the country. The move is likely to have significant implications for the companies affected, as well as for the broader business community in Russia. The fact that all five companies continued operating in Russia after the invasion of Ukraine suggests that they may have been seen as vulnerable to seizure by the Russian government.

The background to this move is Russia's ongoing conflict with Ukraine, which has led to a significant deterioration in relations between Russia and Western countries. The seizure of these assets is likely to further strain these relations, and may lead to retaliatory measures from Western governments. As the situation continues to unfold, it remains to be seen what the full implications of this move will be for the companies affected, and for the broader business community in Russia.