Tokyo demands Moscow release seized Japan Tobacco assets

Tokyo said Friday it had demanded the immediate release of Japan Tobacco’s assets seized in Russia, as relations with Moscow sour following the arrest of a Japanese journalist on spying allegations.

The seizure, which the Kremlin ordered Thursday, is the latest move against a foreign company’s Russian operations under rules that Moscow casts as retribution for international sanctions.

Japan Tobacco is one of the world’s biggest tobacco companies and holds around 40% of the Russian cigarette market, according to media reports.

Japanese government spokesman Minoru Kihara said that two senior officials from Tokyo visiting Russia “had lodged a protest with the Russian government together with the ambassador of Japan to Russia, and demanded the immediate withdrawal of the measure”.

Japan Tobacco said Friday that four of the group’s manufacturing subsidiaries had been placed under temporary control and it was assessing “possible actions”.

“Our group has continued its business operations in Russia while complying with all domestic and international sanctions and regulations,” the firm said in a statement.

A decree issued by President Vladimir Putin on Thursday said the assets would be taken into “temporary administration”.

Control of the company’s Russian operations has been handed to a Russian company called “Industrial Assets”, the decree stipulated.

Ryosei Akazawa, Japan’s minister for economy, trade and industry, said Friday that Tokyo had been “on alert” to the risk to Japanese interests in Russia.

The officials who had lodged the protest had been on a business trip at the time of the seizure to push for the safeguard of Japanese companies’ assets, he added.

Several European firms have seen their Russian operations effectively lost  — most recently Swiss food conglomerate Nestle and French supermarket giant Auchan.

Hundreds of foreign companies left Russia in the wake of its full-scale invasion in Ukraine in February 2022, but many others chose to stay.

Moscow slapped tough financial restrictions on companies from so-called “unfriendly” countries that have put sanctions on Moscow over the war.

Japan, which has a decades-old dispute with Moscow over a string of islands in the Pacific, has joined in some sanctions against Moscow over its war in Ukraine.

Russia’s FSB security service arrested Japanese journalist Yuki Imai from the Hokkaido Shimbun newspaper last month on allegations of “conducting espionage activities on Russian territory”.

The foreign ministry in Moscow has also accused Tokyo of systematically using journalists for espionage operations inside the country.

Japan has denied the allegations.

Subscribe to our newsletter and get news delivered to your mailbox.