Russia is preparing for the nationalization of foreign companies. The Russian government has drafted a law to prevent the withdrawal of foreign capital from the country, with the possibility of its nationalization. The bill provides for the introduction of “external administration” in companies, if foreign owners close them. That would mean, as Russian President Vladimir Putin said at a meeting with his Cabinet today, the introduction of external management in companies.
“AS FOR THOSE WHO WILL CLOSE THEIR PRODUCTION, WE MUST BE RESOLUTE, IN NO CASE TO ALLOW ANY HARM TO LOCAL SUPPLIERS, RUSSIAN SUPPLIERS OF COMPONENTS AND MATERIALS. “IT IS NECESSARY, AS THE PRIME MINISTER SUGGESTED, TO INTRODUCE EXTERNAL MANAGEMENT AND THEN TRANSFER THESE COMPANIES TO THOSE WHO WANT TO WORK,” PUTIN SAID.
A list of foreign companies that could be nationalized has been submitted to the Public Prosecutor’s Office, the Russian portal Izvestia reported. It includes 59 companies that have announced the closure of operations in Russia, including Volkswagen, Apple, IKEA, Microsoft. IBM, Shell, McDonald’s, Porsche, Toyota, HiM and others.
Companies that leave Russia or stop investing include industrial and mining giants such as Caterpillar, Rio Tinto, Starbucks, Sony and Junilever.
“A DRAFT LAW HAS BEEN PREPARED TO PREVENT THE CLOSURE OF PRODUCTION. IF FOREIGN OWNERS CLOSE THE COMPANY UNJUSTIFIABLY, THE GOVERNMENT PROPOSES TO INTRODUCE AN EXTERNAL ADMINISTRATION. DEPENDING ON THE DECISION OF THE OWNER, IT WILL DETERMINE THE FUTURE AND FATE OF THE COMPANY. “THE KEY GOAL WILL BE TO PRESERVE THE PROFILE OF THE ORGANIZATION AND THE JOBS,” SAID MIKHAIL MISHUSTIN, RUSSIA’S PRIME MINISTER.
In addition to seizing the assets and capital of foreign companies, Russia has retaliated by imposing sanctions on it by imposing export bans on a range of products by the end of 2022. Among the banned products for export are telecommunication products, medical, vehicles, agricultural and electrical equipment, but also wood for the wood industry. The ban also includes the export of goods made by foreign companies operating in Russia. Items include cars, railroad cars and containers.
In addition, Russia, as a countermeasure to the sanctions, announced a possible restriction on foreign ships in Russian ports.
According to the Interfax news agency, Russia could temporarily ban grain exports to the countries of the former Soviet Union, which are part of the Eurasian Economic Union, from March 15 to August 31, and at the same time ban sugar exports outside the Union. .
Sanctions against Russia over its invasion of Ukraine have already dealt a severe blow to the Russian economy. Putin told a cabinet meeting today that the West had “failed to meet its financial obligations to Russia, frozen its gold and foreign exchange reserves and tried by all means to halt foreign trade and create a shortage of daily goods imported into Russia.” , forcing the closure of foreign-owned businesses. According to him, Russia’s first priority in such conditions is to stabilize the situation in the financial system.