Russia not interested in nationalizing foreign enterprises, says minister

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Moscow is not interested in nationalizing foreign-owned enterprises operating in Russia, Trade and Industry Minister Denis Manturov said on Friday, in comments likely to provide only limited reassurance to Western businesses.

Many Western and other foreign companies decided to quit Russia after it invaded Ukraine, while Moscow has been working on a law to allow the state to seize assets of firms that go.

“We are not interested in the nationalization of enterprises or their removal, God forbid,” Manturov told parliament’s lower house, the State Duma.

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But he thanked deputies for giving initial approval in May to a bill allowing the state to seize control of an enterprise in the event of a “sudden departure” by a foreign partner in order to save jobs and pay wages and taxes.

“This is also a message for our foreign partners to think about how and what decisions they will take for themselves. We want a comfortable, mutually beneficial working relationship,” said Manturov.

The draft law has not advanced through the Duma since passing its first of three readings in May.

After making his comments to the Duma, Manturov was confirmed by lawmakers as a new deputy prime minister, while retaining his ministerial post, in line with a decree that President Vladimir Putin issued on Tuesday.

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The move boosts his influence on policy as Russia seeks to defend its economy against stringent Western sanctions.

Moscow has already taken steps towards nationalizing some foreign-held assets, including Putin’s order on June 30 for the state to take full control of the Sakhalin-2 gas and oil project, a move that could force out Shell and Japan’s Mitsui and Mitsubishi.

Companies which have decided to leave have been wrestling with how to limit the financial impact, protect jobs of Russian staff and, in some cases, leave an option to return.

Western firms, including Nike and Cisco, have accelerated their departures in recent weeks amid speculation that new laws were imminent. The delay in passing the law on asset seizures has given foreign firms extra time.

“We always try to find a balance of interests. So far, there are no cases of ‘slamming the door and leaving’,” Manturov said. (Reporting by Reuters; Editing by Edmund Blair)