Russia’s Google files for bankruptcy after bank account confiscation

May 18 (Reuters) – Russia’s Google subsidiary plans to file for bankruptcy after authorities seized his bank account, making it impossible to pay employees and suppliers, but free services including search and YouTube will continue to operate, a spokesman for Russia’s Google Inc said on Wednesday. .

Alphabet Corporation (GOOGL.O) The unit has been under pressure in Russia for months for failing to remove content Moscow considers illegal and to restrict access to some Russian media on YouTube, but the Kremlin has so far not blocked access to the company’s services.

“The seizure of the Google Russia bank account by the Russian authorities made it unacceptable for our office to operate in Russia, including hiring and paying employees residing in Russia, paying suppliers and sellers, and fulfilling other financial obligations,” a Google spokesperson said.

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Google Russia has published a notice of its intent to file for bankruptcy.

A TV channel owned by a Russian businessman under sanctions said in April that debt preparers had seized 1 billion rubles ($15 million) from Google over its failure to regain access to its YouTube account, but this is the first time the US tech giant has announced its bank. . The account as a whole has been taken over. Read more

Google did not immediately confirm whether the confiscation of those funds led to its intent to file for bankruptcy, or whether other seizures had taken place.

The Russian Federal Bailiffs Service database listed two seizures since mid-March, without specifying the amounts, as well as other fines and enforcement fees.

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The service confirmed that it had seized the assets and property of Google.

Google has moved many of its employees from Russia since Moscow sent tens of thousands of troops to Ukraine on February 24. But some stayed.

A memo published on the official Russian registry Fedresurs on Wednesday said that the Google subsidiary had intended to file for bankruptcy and since March 22 had predicted “an inability to meet its financial obligations,” including severance pay, bonuses for current and former employees and mandatory and timely payments.

Free Survival Services

Google, which has temporarily halted ad sales and most other business operations in Russia, said its free services, including Gmail, Maps, Android and Play, would still be available to Russian users.

Russia said on Tuesday it had no plans to block YouTube from Google, despite 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) CEO Mikhail Osevsky said on Wednesday that Google is operating as usual in the country, including all of its servers, TASS news agency reported.

In December, Russia handed Google 7.2 billion rubles in fees for what Moscow described as repeated failures to remove content Russia considers illegal, the first revenue-based penalty from this type of case in Russia.

The data of the bailiffs showed that the fine increased by 506 million rubles due to enforcement fees.

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The Spark database of the Interfax news agency of Russian companies showed that the revenue of the Russian subsidiary Google of Google in 2021 amounted to 134.3 billion rubles.

Alphabet said last month that Russia accounted for 1% of its revenue last year, or about $2.6 billion.

(1 dollar = 63.9570 rubles)

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Reporting by Reuters. Editing by Eileen Hardcastle, Guy Faulconbridge, David Clarke and Barbara Lewis

Our criteria: Thomson Reuters Trust Principles.

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