Bloomberg Law
March 11, 2022, 4:08 AM

Sony, Uniqlo Join Global Brands Disappearing From Russia

Adam Majendie
Adam Majendie
Bloomberg News

Sony’s Playstations, Uniqlo attire, McDonald’s burgers. The list of global brands disappearing from Russian outlets keeps growing as some of the world’s biggest businesses, from energy to consumer goods and electronics, suspend operations in the country.

International sanctions, the closure of airspace and transport links, financial restrictions on SWIFT and capital controls have made it difficult if not impossible for many companies to supply parts, make payments and deliver goods in Russia. Added to that, the potential consumer backlash against any company perceived as supporting Vladimir Putin’s two-week-old invasion of Ukraine has turned the corporate exodus into a stampede.

WATCH: McDonald’s, Coca-Cola and Starbucks join the langthening list of firms suspending business operations in Russia.
Source: Bloomberg

The rout reverses three decades of investment in Russia by foreign businesses after the Soviet Union broke apart in 1991. Those that pull out could lose their investments. The Russian government is supporting a proposal by the dominant United Russia party to consider the sale or even nationalization of operations of foreign companies that leave the Russian market, according to Kommersant.

Here are some of the biggest companies that have suspended business in Russia:


Russia’s largest foreign investor, BP Plc, led the way with its surprise announcement on Feb. 27 that it would exit its 20% stake in state-controlled Rosneft, a move that could result in a $25 billion writeoff and cut the company’s global oil and gas production by a third.

Read More: U.S. and U.K. Ban Russia Oil Imports, Squeezing Putin on War

Shell Plc followed, citing Russia’s “senseless act of military aggression.” The company said it would end partnerships with state-controlled Gazprom, including the Sakhalin-II liquefied natural gas facility and its involvement in the Nord Stream 2 pipeline, which Germany has blocked. The projects are worth about $3 billion. Exxon Mobil Corp. said it would “discontinue” its Sakhalin-1 operations.

Equinor ASA, Norway’s state-owned energy giant, said it will start withdrawing from its joint ventures in Russia, worth about $1.2 billion. In parallel, Norway’s sovereign wealth fund, the world’s largest, is freezing Russian assets worth about $2.8 billion and said it will come up with a plan to exit by March 15.


JPMorgan Chase & Co. the biggest U.S. bank, said its operations in Russia are now limited and include “helping global clients address and close out pre-existing obligations; managing their Russia-related risk; acting as a custodian to our clients; and taking care of our employees.” Goldman Sachs Group Inc., said it plans to close its operations in the country.

Neither has a large direct exposure to Russia, unlike Citigroup Inc., which has about 3,000 workers in the country, the largest presence of any major U.S. bank. Citigroup, which said it would exit its consumer business in Russia, is now operating it “on a more limited basis,” said Edward Skyler, executive vice president of global public affairs.

Potential suitors for Citigroup’s retail operation in Russia are subject to sanctions imposed by the U.S. government, adding another obstacle to the sale.

Visa Inc. and Mastercard Inc. said on March 5 they are suspending operations in Russia. Ukrainian President Volodymyr Zelenskiy had called on the companies to halt all business in Russia during a video call with U.S. lawmakers. Each of the firms gets about 4% of its net revenue from business linked to the country. American Express followed the next day.

Some critics argued that the steps aren’t enough. While the companies said any transactions initiated with their cards issued in Russia will no longer work outside the country and cards issued outside of Russia won’t work at Russian merchants or ATMs, consumers inside Russia who have a locally issued card can still pay for goods and services there.

JPMorgan Chase & Co. joined Goldman Sachs Group Inc. in pulling back from Russia in response to the country’s invasion of Ukraine last month. Both banks are winding down operations in Russia. Sridhar Natarajan reports.
Source: Bloomberg

Paypal Holdings Inc. said on Tuesday it’s also suspending services, adding to the difficulty many online retailers in Russia face in collecting and processing payments from customers.

Fitch Group, Moody’s Corp. and S&P Global have all suspended operations in Russia. The three have slashed Russia’s ratings to junk.

Marsh & McLennan Cos., the world’s largest insurance brokerage, said it’s exiting “all of its businesses in Russia.”


Most of the world’s biggest carmakers including General Motors Co., Ford Motor Co., Volkswagen AG, Stellantis NV and Toyota Motor Corp. have announced they would halt shipments to Russia or idle plants in the country. But the automaker with the most to lose, Renault SA, has remained quiet.

The French company has majority control of AvtoVaz, the Soviet-era maker of Ladas, and relied on Russia for about 10% of its revenue. Its stock has lost more than a quarter of its value since the invasion began two weeks ago. “Renault has promised to abide by sanctions,” Gabriel Attal, the French government spokesman, said on March 3 on France Info radio.


On Tuesday, McDonald’s Corp., Coca-Cola Co. and Starbucks Corp. all announced they would temporarily halt operations in Russia. Some companies’ withdrawal makes it easier for others to do the same, said Gene Grabowski, a partner at communications firm KGlobal. McDonald’s action, for example, deprives Coca-Cola of a major client in the country.

Kraft Heinz Co., maker of Oscar Mayer hot dogs and Philadelphia cream cheese, suspended exports and imports of products to and from Russia as well as new investment in the country. Pizza chain Papa John’s International Inc. said it has stopped all support to the Russian market, where it has 188 franchised restaurants. The company said it isn’t receiving any royalties from these stores, which last year accountedfor less than 1% of its sales.

Some firms have suspended international dealings with Russia but continue to operate within the country. Cereal giant Kellogg Co. suspended shipments into Russia and investment there, but said it will produce food locally at its three Russian plants, which represent just over 1% of the company’s business.

Imperial Brands Plc became the first major cigarette maker to stop all operations in Russia after halting production at its Volgograd factory as well as all sales and marketing. The maker of Kool and Gauloises cigarettes said its 1,000 employees in Russia will continue to be paid. Rival Philip Morris International Inc. is scaling down manufacturing in Russia amid supply-chain disruptions and evolving regulations. The company has halted investments and new product launches in Russia.

Levi Strauss & Co. whose jeans were a coveted black-market item in the Soviet Union, also suspended commercial operations in Russia, where it gets about 2% of its sales, citing the “enormous disruption occurring in the region.” It said the business considerations “are clearly secondary to the human suffering.”

Nike Inc. is another that cited logistical problems as a reason for suspending sales in Russia. Spanish fashion retailer Inditex SA, which has 502 stores in Russia, including 86 Zara outlets, is temporarily closing its shops there and halting online sales, saying it “cannot guarantee the continuity of operations and trading conditions.”

Heineken NV stopped production and sales of its namesake beer in Russia, after previously halting new investments in the country and exports of other brands. The Dutch brewer said it is assessing options for the business in Russia, where it has operated for two decades.

Carlsberg A/S, the biggest brewer in Russia, will drop all advertising and stop producing and selling the flagship Carlsberg brand in the country. The Copenhagen-based company employs 8,400 people in Russia, and that nation together with Ukraine accounted for about 13% of group revenue and 9% of operating profit in 2021, Carlsberg said Wednesday.

Fast Retailing Co.’s Uniqlo apparel chain said it will temporarily suspend operations in Russia, where it has 50 stores. The move marks a reversal after Fast Retailing founder Tadashi Yanai earlier this week said clothing is a “necessity of life” and that Russians have “the same right to live as we do.” Rivals, including Hennes & Mauritz AB and Zara’s Inditex SA, had previously stopped selling there.

German fashion brand Hugo Boss AG closed its stores in Russia on Wednesday and suspended its e-commerce website last week, CEO Daniel Grieder told Bloomberg TV Thursday. Russia and Ukraine account for 3% of revenue, he said.

U.K. mother-and-child retailer Mothercare Plc said Wednesday it has suspended business in Russia, including shipments. The company makes about 20% to 25% of its sales in Russia through a local partner. It said 120 stores will be immediately shut and online sales paused.

Others have divided the action for their product ranges. PepsiCo Inc. suspended soft-drink sales in the country but continues to sell daily essentials such as milk and baby formula. Danone SA’s general secretary, Laurent Sacchi, said the world’s largest yogurt maker would suspend investment in Russia, but will still sell dairy and baby food.

Danone Chief Executive Officer Antoine de Saint-Affrique was among the corporate leaders of some of France’s biggest companies who met with Emmanuel Macron on March 4, according to Le Figaro. The French president urged them not to leave Russia hastily, or without consulting the government, the newspaper reported.


Samsung Electronics Co., the leading smartphone seller in Russia with more than 30% of the market, suspended exports to the country of all its products and said it will donate $6 million to humanitarian efforts in the region, including $1 million in electronics products. Sony halted software and hardware shipments for its PlayStation game system in Russia, and suspended the launch of “Gran Turismo 7” and operation of its online PlayStation Store.

Microsoft on March 4 condemned the “unjustified, unprovoked and unlawful invasion” of Ukraine and said it’s suspending all new sales of products and services in Russia. Apple Inc. halted sales of iPhones and started limiting Apple Pay services and other products in Russia, and removed the RT News and Sputnik News applications from App Stores outside the country. HP Inc., the largest supplier of PCs to Russia, stopped exports to the country, as did Intel Corp. Inc.’s cloud-computing unit announced in a blog post it will stop accepting new customers in Russia or Belarus.


Netflix Inc. is shutting its operations in Russia and said no new customers will be able to sign up, though it’s unclear what will happen with existing accounts.

Netflix has fewer than one million customers in Russia and has been operating in the country through a partnership with National Media Group. The streaming giant has paused all projects and acquisitions from Russia, including four programs in production.

Sony Music Entertainment also suspended operations in Russia.


Accor SA, the French operator of Fairmont, Banyan Tree and Sofitel hotels, said its 57 Russian locations remain open, but it’s suspending work on five properties in development.

The company has 3,500 employees in Russia but doesn’t own any of the hotels and said it’s the decision of the owner as to whether a property should be closed. It has halted all services to hotels whose owners are under U.S. or European sanctions and paused loyalty programs with Russian partners.

Of Accor’s seven hotels in Ukraine, only one, in Lviv, remains open for guests. The others are being used to shelter employees, their families and members of the media, a company spokesperson said. Accor is one of the largest hotel operators in the region, and 15 of its hotels are accommodating refugees, including five in Paris.

Hilton Worldwide Holdings Inc., Hyatt Hotels Corp. and InterContinental Hotels Group Plc also said they would suspend the development of new hotels in Russia and provide free accommodation in Europe for refugees. Hilton said it has closed its corporate office in Moscow and would donate any profits from Russia to humanitarian relief efforts in Ukraine.

Hollywood studios including Walt Disney Co., Paramount Pictures, Sony Corp., and AT&T Inc.’s WarnerMedia and Comcast Corp.’s Universal Pictures have also halted or postponed the release of movies in Russia.

Meanwhile other platforms, including TikTok, are suspending or closing services because of Russia’s new “fake news” law aimed at silencing dissent and limiting information about the invasion of Ukraine. The company, owned by China-based ByteDance Ltd., said its in-app messaging service would not be affected.

On March 4, the Russian government said it was blocking access to Meta Platforms Inc.’s Facebook as part of the crackdown. Hours after the announcement, Meta said it would pause all advertising in the nation and would stop selling ads to Russian businesses. The company’s global Instagram platform will label posts from Russian state media with a warning, ranking them lower and making them harder to find.


Alstom SA is halting all deliveries to Russia and will suspend future investment in the country, it said Wednesday. The French rail-equipment maker will reassess the book value of its 20% stake in Transmashholding, the biggest supplier of rolling stock to Russia’s railways.

Iveco Group NV has halted vehicle deliveries to Russia and Belarus and is weighing pulling out of a Russian joint venture. Gerrit Marx, the truckmaker’s CEO, said “it’s impossible for me to do business with Russia” as long as the current regime is in power.

Law and Accounting

Wall Street law firm Cleary Gottlieb Steen & Hamilton said it’s exiting its engagements with Russian government and state-owned entities, and shuttering its Moscow office. The firm represented the Russian government in a long-running dispute with Ukraine over a $3 billion bond default, a case that is awaiting a U.K. Supreme Court ruling.

Baker McKenzie said last week it was reviewing its operations in Russia and will sever ties with several Russian clients in order to comply with sanctions. The Chicago-headquartered firm’s clients include Russia’s finance ministry and VTB, Russia’s second largest bank. London-based Linklaters said in a statement it was “reviewing all of the firm’s Russia-related work.”

Latham & Watkins, Clifford Chance, Morgan Lewis & Bockius, Allen & Overy, Freshfields Bruckhaus Deringer and Akin Gump Strauss Hauer & Feld are among other big law firms shuttering or suspending operations in Russia.

“As a firm built by Robert Strauss, the last U.S. Ambassador to the Soviet Union and the first U.S. Ambassador to the Russian Federation, Akin Gump is deeply saddened and shocked by the events in Ukraine and the tragic and senseless loss of life,” the firm said in a statement.

The big four auditors, EY, PricewaterhouseCoopers LLP, KPMG LLP and Deloitte all said they are pulling out of Russia. Between them, they have more than 15,000 staff in Russia and Belarus.

McKinsey & Co. said it won’t undertake new client work in Russia and will halt all client service in the country after its remaining engagements conclude, though its office will remain open to support staff.

(Adds action by U.S. banks, U.K. law firms)

--With assistance from Kanoko Matsuyama, Stefan Nicola, Angelina Rascouet, Corinne Gretler, Alberto Brambilla, Tara Patel, Mark Gurman, Stephanie Baker, Martine Paris and Christian Wienberg.

To contact Bloomberg News staff for this story:
Adam Majendie in Singapore at

To contact the editors responsible for this story:
Alyssa McDonald at

Adam Majendie, Frank Connelly

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