Phoenix 24
Foreign investment becomes another instrument of geopolitical confrontation.
Moscow, Russia.
Russian President Vladimir Putin has placed the local operations of Swiss food giant Nestlé and several French companies under temporary administration, expanding Moscow’s intervention in foreign-owned businesses amid its confrontation with Western governments. A presidential decree issued on September 17 transferred management rights over 16 Russian companies to L.E.V. Management, a relatively unknown Moscow-based firm. The affected businesses include supermarket operator Auchan, logistics group FM Logistic and Le Monlid, which operates the former Leroy Merlin stores under the Lemana Pro brand. The decision represents another significant intervention in foreign corporate operations following Russia’s full-scale invasion of Ukraine in 2022.
The measure grants the appointed administrator operational control without formally transferring ownership of the affected companies. However, previous interventions involving Danone, Carlsberg and other Western businesses have demonstrated that temporary administration can precede forced sales or changes in ownership. Kremlin spokesperson Dmitry Peskov justified the latest decision by referring to geopolitical tensions and the involvement of countries Moscow classifies as unfriendly. His explanation reflects the Russian government’s position rather than an independent determination that the affected companies participated in military activities.
Nestlé faces considerable operational uncertainty. The Swiss multinational maintains six factories and approximately 7,000 employees in Russia, although the country now represents only around 1% of its global sales. Following the invasion of Ukraine, the company suspended most nonessential sales, imports, exports, advertising and capital investment while continuing to supply products it considers essential. Nestlé has announced that it is assessing its options and intends to protect its rights, employees and business continuity.
Auchan faces a larger employment exposure, with approximately 230 stores and 30,000 workers across Russia. Its Russian subsidiary has requested clarification from authorities while maintaining normal operations at its stores and other facilities. Lemana Pro has similarly indicated that business activities continue, despite the intervention affecting the corporate structure associated with its former French parent company. The immediate operational consequences therefore remain uncertain, even though management authority has been reassigned.
The appointment of L.E.V. Management introduces additional questions about transparency. Registered in Moscow in October 2024, the company has no publicly disclosed shareholders and reported no active business operations in its available 2025 accounts, according to Russian newspaper Kommersant. Its director was appointed shortly before the presidential decree, but the relationship between the administrator’s corporate structure and the government’s longer-term objectives has not been fully explained. The absence of a publicly announced asset valuation or sale agreement limits conclusions about the companies’ eventual ownership.
For international investors, the intervention highlights the risks associated with operating under jurisdictions where geopolitical disputes can alter established management rights. Russia has already introduced stringent exit requirements for foreign companies, including government approval, substantial discounts and additional financial obligations. These restrictions complicate both continued investment and withdrawal, leaving businesses exposed to decisions beyond their commercial control.
The latest decree does not establish that the affected companies have been permanently nationalized. It does, however, demonstrate how state authority can alter the practical control of foreign assets without immediately changing their formal ownership.
Russia’s intervention adds another dimension to the economic consequences of the war in Ukraine. Its longer-term implications will depend on whether temporary administration remains in place or develops into ownership transfers, litigation and further commercial disengagement.
La verdad es estructura, no ruido. / Truth is structure, not noise.