The Russian government transferred its interests in and assets of 4 Japan Tobacco International (JTI) entities in Russia to state-affiliated industrial asset management. The local business is being operated under an interim management structure, with effective management rights transferred to the Russian government.
On the 5th, the Russian government signed a presidential decree placing JTI's interests in and assets of 4 entities in Russia under the control of Industrial Assets, a management company. Under this arrangement, an administrator working with the state will be appointed to operate the assets without the consent or compensation of the foreign owner, effectively transferring management rights to the state regardless of the nominal owner.
The measure is considered part of Russia's efforts to seize assets in response to Western sanctions imposed since its invasion of Ukraine. JTI held a 40% share of the Russian market and was regarded as a major operator employing approximately 4,000 people at 4 local factories.
The newly established entity that took over JTI's assets was registered on 16 September, and its ownership is managed by associates of Sergey Dremov, a person connected to the Russian state. Russia has not specified the purpose of the asset seizure, but it is said to have continued similar measures in the past in response to hostile actions by unfriendly countries.