Russia Places Japan Tobacco Assets Under State Control by Decree

Russian President Vladimir Putin signed a presidential decree placing the Russian manufacturing operations of Japan Tobacco International under the temporary management of a state-linked holding company named Industrial Assets.

The action transfers control of Russia's largest tobacco producer, which operates four production sites including two cigarette factories in St Petersburg, Rostov-on-Don, and the Lipetsk region. Japanese Finance Minister Satsuki Katayama stated that Tokyo lodged a formal protest through diplomatic channels and requested the immediate withdrawal of the measure. Trade minister Ryosei Akazawa stated that the government had been on alert for such a move targeting Japanese interests.

Japan Tobacco confirmed that the order covers all four manufacturing subsidiaries and stated that the company is assessing the impact on the group with employees as a priority. Russia accounts for approximately ten percent of Japan Tobacco Group revenue and roughly a quarter of its operating profit, with the company operating in Russia since 1999 and leading the market by sales volume since 2007.