May 18 (Reuters) – Google’s Russian subsidiary plans to file for bankruptcy after the authorities seized its bank account, making it impossible to carry on operations, a Google spokesperson said on Wednesday.
Alphabet Inc’s Google (GOOGL.O) Google has been under pressure in Russia for months for failing to delete content Moscow deems illegal and for restricting access to some Russian media on YouTube, but the Kremlin has so far stopped short of blocking access to its platforms.
“The Russian authorities seizure of Google Russia’s bank account has made it untenable for our Russia office to function, including employing and paying Russia-based employees, paying suppliers and vendors, and meeting other financial obligations,” a Google spokesperson said.
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“Google Russia has published a notice of its intention to file for bankruptcy.”
A TV channel owned by a sanctioned Russian businessman said in April that bailiffs had seized 1 billion roubles ($15 million) from Google over its failure to restore access to its YouTube account, but this is the first time the U.S. tech giant has said its bank account as whole has been seized. read more
Google did not immediately confirm whether it was the seizure of those funds that led to its intention to file for bankruptcy, or whether other seizures had occurred.
The database of Russia’s Federal Bailiffs Service listed two seizures since mid-March, without specifying the amounts, as well as other fines and enforcement fees.
The service confirmed that it had seized Google assets and property.
A note posted on Russia’s official registry Fedresurs on Wednesday said the Google subsidiary was: “submitting a notice of the intention to declare itself insolvent (bankrupt).”
“Since March 22, 2022, it foresees its own bankruptcy and inability to fulfil its monetary obligations, demands to pay severance payments and (or) the remuneration of staff working or previously working under an employment contract, and (or) the obligation to make mandatory payments within the prescribed period,” the note said.
FREE SERVICES TO STAY
Google, which has paused the vast majority of its commercial operations in Russia in the wake of Moscow sending tens of thousands of troops into Ukraine on Feb. 24, said its free services, including Search, YouTube, Gmail, Maps, Android and Play, would remain available for Russian users.
Russia said on Tuesday it was not planning to block Google’s YouTube, in spite of repeated threats and fines, acknowledging that such a move would likely see Russian users suffer and should therefore be avoided. read more
Rostelecom (RTKM.MM) Chief Executive Mikhail Oseevskiy said on Wednesday that Google was operating as normal in the country, including all its servers, the TASS news agency reported.
In December, Russia handed Google a 7.2 billion rouble charge for what Moscow said was a repeated failure to delete content Russia deems illegal, the first revenue-based penalty in that kind of case in Russia.
That fine increased by 506 million roubles due to an enforcement fee, bailiffs data showed.
The Russian subsidiary’s 2021 revenue was 134.3 billion roubles, Interfax news agency’s Spark database of Russian companies showed.
($1 = 63.9570 roubles)
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Reporting by Reuters; Editing by Elaine Hardcastle, Guy Faulconbridge and David Clarke
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