In recent months, Russia began seizing assets from companies based in Western countries.
The most recent development came last week, when the Russian government seized the local operations of two of the world's largest consumer packaged goods manufacturers.
Assets belonging to French dairy product giant Danone
The seizures were made possible after an April decree authorized the seizing of assets belonging to companies from states "unfriendly and contrary to international law."
Straight after Russian head of state Vladimir Putin signed the April decree, Russia took over assets from two European companies: The Russian arm of German state-owned energy firm Uniper SE and assets of Finland's state-owned energy firm Fortum Oyj.
"The decree does not concern ownership issues and does not deprive owners of their assets," wrote Russian News Agency TASS. The move came as an apparent retaliation to similar measures by European countries.
In September, Germany seized the local refinery of Russian oil giant Rosneft PJSC.
After the February 2022 invasion of Ukraine by Russian forces, the European Union froze over 200 billion euros ($221.5 billion) in assets from Russia's central bank. Last month, a summit of EU leaders was looking into ways it can route these assets to Ukraine's reconstruction efforts, reported Reuters.
US Companies Stuck Behind Enemy Lines
Recent Russian and European asset seizures are an economic escalation of the war on Ukrainian soil. With the latest round of seizures, Russia is further cementing its position as a "pariah" state. This has led many foreign-based companies to begin planning their escape routes in an effort to reduce the risk associated with having operations in Russia and mitigate possible losses of a higher order.
According to a report by the Yale School of Management, at least 1,000 companies based outside of Russia have announced plans to either leave the country or significantly reduce their operations there.
The U.S. has the largest number of companies announcing plans to fully leave Russia. These represent 32% of the whole group.
Ford
Leaving Russia can be costly for foreign companies. As per a regulation set by Moscow in December, the Russian government will assess the value of assets for sale from foreign companies, and then oblige the company to sell them at a half-price discount, according to the WSJ.
Many other U.S. companies continue to operate in Russia. All are facing the potential risk of having some or all of their Russian assets seized, as lethal aid sent to Ukraine by the U.S. military puts the U.S. on Putin's "unfriendly country" list.
Kimberly Clark Corp
Abbott Laboratories
Other companies are already scaling back, with a proverbial foot out the door, though reducing operations can prove to be very costly.
Philip Morris International Inc.
The Coca-Cola Company
General Electric
Many other companies have suspended all operations. FedEx
Intel
Apple
