Russian President Vladimir Putin has placed the local assets of Japanese tobacco giant Japan Tobacco International (JTI) under temporary management, according to a decree published on the official legal information portal on Thursday.
The decree transfers management of four JTI businesses – Petro, Donskoy Tabak, JTI Yelets, and Kres Neva – to Russian company Promyshlennye Aktivy (Industrial Assets).
The Petro factory in St. Petersburg and Donskoy Tabak in Rostov-on-Don produce cigarettes, while JTI Yelets in Lipetsk Region and Kres Neva in Leningrad Region process tobacco. The measure covers 100% of the ownership interests in each of the four businesses, held by the group’s foreign and Russian subsidiaries.
JTI is the international arm of Japan Tobacco, one of the world’s largest cigarette manufacturers. The company has operated in Russia since 1999 and strengthened its position in 2018 by acquiring Donskoy Tabak for approximately $1.6 billion. Its brands include Winston, Camel, Sobranie, Mevius, and LD, along with Russian labels such as Petr I and Russky Stil.
Following the escalation of the Ukraine conflict in 2022, JTI suspended new investments and marketing activities in Russia and considered selling its local business. However, the company decided to stay, citing its commitment to consumers. In 2024, Japan Tobacco CEO Masamichi Terabatake told the Financial Times that Russia had accounted for around 20% of the group’s profits and that leaving the profitable market could expose shareholders to losses.
JTI is the first major international tobacco company to have its Russian operations placed under temporary management. The decree does not specify the reasons for the decision.
The move comes against a backdrop of tensions involving Japanese companies and the Ukraine conflict. In October, the Russian Defense Ministry reported a strike on the JTI Ukraine tobacco factory in Kremenchug, saying that the facility had been used to produce small-arms ammunition for Ukrainian forces.
Later that month, Russia’s Foreign Ministry warned of a strong response after Japanese drone maker Terra Drone supplied interceptor drones to Ukraine. Moscow described the deliveries as a hostile act, accusing Tokyo of encouraging military cooperation between Japanese companies and Kiev.
The decision follows similar measures involving the Russian operations of several major foreign companies, including Swiss food giant Nestle, French retailers Auchan and Leroy Merlin, German wholesaler Metro, and French flooring manufacturer Tarkett.
Moscow introduced the mechanism in April 2023 in response to the seizure or restriction of Russian state and private assets abroad. Officials said it was intended to protect strategically important businesses and shield the economy from actions by countries Russia considers “unfriendly.”
Under the arrangement, foreign owners lose control over the management of their businesses but do not automatically forfeit ownership. Russian authorities can appoint domestic companies or state bodies to operate the affected enterprises.
In March 2025, Italian appliance maker Ariston regained control of its Russian subsidiary after announcing plans to resume operations in the country. The business had been placed under the management of Gazprom Household Systems the previous year.
At the Valdai Discussion Club in October, Putin said Russia was not seizing, stealing, or nationalizing foreign assets, calling claims to the contrary “lies and provocations.” He said that temporary management was intended to allow Moscow to respond in kind to the seizure of Russian property abroad. Asked whether foreign companies would regain control of their businesses under favorable circumstances, he replied: “Yes, they will.”
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