“This is not about reconsidering privatization.” Putin explained the seizure of assets by the state as national interests

Russian President Vladimir Putin said that the seizure of a business into state ownership is justified in cases where the actions of the owner harm the security of the state. There is no talk of any revision of the results of privatization, he assured, speaking at the congress of the Russian Union of Industrialists and Entrepreneurs.

“Recently, law enforcement agencies have opened a number of cases to return some assets to state ownership. I would like to emphasize that we are not talking about revising privatization, but about cases where the actions or inactions of the owners of enterprises and property complexes cause direct damage to the country’s security and national interests,” Interfax quotes Putin as saying.

According to Putin, “no formal reasons or clues” are acceptable in relation to the current owners of former state assets. He recalled the privatization of some enterprises in the 1990s only in agreement with regional, but not federal authorities. Putin noted that the Cabinet of Ministers at that time itself withdrew from participation in this.

“This means that claims against the current owners of assets are inappropriate, especially against those who work normally, successfully, solve social issues, and help ensure national security,” Putin said.

In April 2023, Putin signed a decree allowing the assets of foreign companies in Russia to be transferred to the temporary management of the Federal Property Management Agency (and actually nationalized). Thus, in particular, the owners of the Russian assets of the Carlsberg brewing company changed. Soon, according to the same scheme, the Rolf company, one of the largest car dealers in Russia, was nationalized. This marked the first time that a scheme designed to nationalize the assets of “unfriendly” countries was applied to a company created by a Russian businessman.

At the end of February 2024, a court in the Sverdlovsk region satisfied the claim of the Prosecutor General’s Office of the Russian Federation to confiscate shares from the owners of three industrial enterprises of the Chelyabinsk Electrometallurgical Plant (CHEMK). The enterprises of the ChEMK group are the country’s largest producers of ferroalloys used in the production of steel for military equipment, aircraft engines and ammunition.

The Prosecutor General’s Office also filed a lawsuit with the Central District Court of Chelyabinsk demanding the seizure of Makfa (the country’s largest producer of pasta) and related companies in favor of the state.