Putin seizes control of Carlsberg in Russia, bosses detained

Two high-profile figures from Carlsberg's Russian division have been arrested. The senior executives of the Baltika brewery face charges of fraud following the Kremlin's acquisition of Carlsberg's subsidiary several months ago.

According to Reuters, Denis Sherstennikov and Anton Rogachevsky, top leaders of the Russian branch of Carlsberg, Baltika Brewery, were taken into custody on Thursday. The St. Petersburg District Court issued a temporary arrest order on fraud-related charges, valid until December 30. Prosecutors claim these employees unlawfully transferred certain intellectual property rights to Carlsberg, even after Moscow took over Baltika. In Russia, large-scale fraud can result in up to 10 years in prison.

Investigators in St. Petersburg allege that these rights, valued at over 295 million rubles (about $3.89 million), enabled Baltika to distribute its products to Kazakhstan, Kyrgyzstan, Uzbekistan, Turkmenistan, Tajikistan, Mongolia, and Belarus, says the BBC.

Carlsberg faced increasing pressure following the start of Ukraine's invasion. The company had plans to sell off its Russian business. However, in July, under an order signed by President Vladimir Putin, the Kremlin took over Baltika Brewery. Carlsberg announced in October that it had ended all licensing contracts related to its products' production, marketing, and sales in Russia. It granted Baltika until April 1, 2024, to liquidate its accumulated stock and use the pre-purchased ingredients to produce Danish brand recipes and names.

"The Russian state's efforts to validate their illicit takeover of our Russian business have evolved into an attack on innocent workers," Carlsberg expressed in a statement. The company prioritizes employee safety and vowed to assist the detained individuals.

Per the BBC, Baltika has lodged an appeal to the arbitration court, asking for a ban on Carlsberg ending the licensing agreement. Earlier this year, Moscow established regulations permitting the seizure of assets from companies originating from "hostile" nations.