Google Russia Files For Bankruptcy After Russia Freezes Bank Account
Google’s Russian subsidiary had its bank accounts seized by Russia in retaliation for Google’s stance on the Russia-Ukraine war, and has been hit with several fines and lawsuits, all of which means the company is unable to continue its Russian operations.
The Russian subsidiary of Google has, as expected, filed for bankruptcy.
Russian news service Interfax Friday reported that Google filed a motion for bankruptcy with Moscow’s Arbitration Court Thursday. This follows the May 18 filing by Google LLC, the Russian subsidiary of the U.S.-based search giant, that it intended to declare bankruptcy.
The May filing stemmed from Russia’s seizure of Google LLC’s bank account because of Google’s stance on Russia’s war against Ukraine.
Google did not respond to a CRN request for further information by press time.
“The Russian authorities’ seizure of Google Russia’s bank account has made it untenable for our Russia office to function, including employing and paying Russia-based employees, paying suppliers and vendors, and meeting other financial obligations,” a Google spokesperson confirmed on May 18 to CRN in an email. “Google Russia has published a notice of its intention to file for bankruptcy.”
Interfax Friday reported that Google LLC, which registered in Russia in 2005, reported at the end of 2021 revenue of 134.3 billion rubles, or about $1.8 billion using the exchange rate between December 31 and January 1 of 1 ruble to $0.0134. Google LLC also posted a net loss of 26 billion rubles, or $348 million, which Interfax said was that company’s first loss since 2009.
2022 has proven to be a difficult year for tech companies who had invested in business opportunities in Russia. Many high-profile tech companies have shut down or are shutting down operations in Russia in the wake of Russia’s unprovoked assault on Ukraine, including IBM, HP Inc., Hewlett Packard Enterprise, SAP, DXC Technology, Accenture, and others.
For Google in Russia, 2022 has been an especially tough year.
Russian news site TAdviser reported that 2022 saw Google Russia fined three times for a total of 30 million rubles for not deleting prohibited information. The company was also forced to pay 1 billion rubles to the TV channel Tsargrad for blocking the channel on Google and YouTube, 500 million rubles after a lawsuit from NTV, and 1 billion rubles in a case involving the All-Russian State Television and Radio Broadcasting Company.
Furthermore, Bloomberg reported in March that Google started moving some of its Russian employees out of the country.