Russian authorities have taken action to seize the assets of a major vodka producer, Global Spirits Holding, due to allegations of engaging in extremist activities. The company was founded by Ukrainian businessman Yevhen Cherniak, who has been accused of funding Kyiv’s armed forces. The Prosecutor General’s Office filed a legal suit seeking to suspend the work of four distillers belonging to the company in Russia
Global Spirits founder Cherniak has been charged with sponsoring terrorism, accused of transferring funds to the Ukrainian military. He has denied allegations of paying taxes to the Russian state. Cherniak’s Russian associates Alexander Bespalov and Andrei Lazutin were detained on suspicion of bribery. The legal suit in the Kursk region mentions four unidentified defendants, believed to be Cherniak, Bespalov, Lazutin, and Ivan Kurbakov.
The Kursk region court is set to hear the case behind closed doors, with the possibility of transferring the shares and stakes of the distillers to the state and banning the owners from working in Russia. Global Spirits had previously revoked its licenses in Russia following the invasion of Ukraine in 2022. The company has filed a lawsuit in Cyprus over the misuse of its intellectual property, amidst the ongoing legal battles in Russia.
Russian authorities have been seeking to nationalize key defense industry assets since the start of the war in Ukraine. However, the asset seizures are now targeting civilian businesses as well, with the largest winemaker and pasta manufacturer in Russia recently coming under state control. The move to seize Global Spirits assets is part of a broader effort by the government to increase control over the economy as military production ramps up.
The legal actions against Global Spirits raise concerns about the business environment in Russia, as foreign companies face increasing risks of asset seizures and legal challenges. The detention of Cherniak’s associates on bribery charges adds another layer of complexity to the case. The move to target businesses like Global Spirits in the wake of the conflict between Russia and Ukraine highlights the ripple effects of geopolitical conflicts on the economy.
The case involving Global Spirits underscores the challenges faced by multinational companies operating in Russia, where political tensions and legal disputes can impact their operations. The accusations of extremism and terrorism funding against Cherniak and his associates have potentially far-reaching implications for the company and its future in Russia. As the legal proceedings continue, the outcome of the case will be closely watched by the business community and investors for insights into the evolving regulatory environment in Russia.
