TOKYO - Russian President Vladimir Putin has signed a decree placing the Russian operations of Japan Tobacco (JT) under the temporary management of a local company, effectively stripping the Japanese tobacco giant of control over its business in the country and prompting a formal protest from Tokyo demanding that the measure be immediately withdrawn.
The decree covers four companies responsible for the Russian operations of JT International, the overseas subsidiary of Japan Tobacco. The move effectively deprives the Japanese company of management rights over its Russian business, although the arrangement has been described as temporary.
According to Russia's state-run TASS news agency, JT International has operated in Russia since 1999 and has grown into the country's largest tobacco manufacturer, making the decision a significant development for one of Japan's major overseas corporate operations.
The Russian government has been expanding measures to place assets belonging to companies from countries that have imposed sanctions on Moscow under state-directed management. In September, similar action was taken against companies including Swiss food giant Nestle.
Japan Tobacco said it was carefully examining the situation and its available options while prioritizing the interests of employees and other stakeholders. "We are closely assessing the situation and possible future courses of action, placing the highest priority on our employees and other stakeholders," the company said.
The move comes as relations between Japan and Russia continue to deteriorate. In August, Putin made his first visit to Etorofu, one of the Russian-controlled islands claimed by Japan as part of its Northern Territories. Tensions escalated further in October when Russia's Federal Security Service detained a journalist from the Hokkaido Shimbun newspaper.
Chief Cabinet Secretary Minoru Kihara announced at a morning press conference on November 6 that Japan had lodged a formal protest with the Russian government and demanded the immediate reversal of the decree.
Kihara said senior Japanese officials currently visiting Russia, including a senior official from the Ministry of Economy, Trade and Industry and a senior official from the Foreign Ministry's European Affairs Bureau, had joined Japan's ambassador to Russia in delivering the protest directly to Russian authorities.
"The senior officials currently visiting Russia, together with our ambassador, have protested to the Russian government and demanded that the measure be withdrawn immediately," Kihara said.
He emphasized that the Japanese government would continue monitoring developments closely and take appropriate action in response to the situation.
The decision adds to the difficulties facing Japanese companies operating in Russia, where foreign businesses from countries supporting sanctions against Moscow have faced increasing risks of losing control over their local assets.
Source: TBS
