Russia's largest brewery drags Carlsberg to court for terminating licence amid war

Baltika Breweries, Russia's largest brewery company, has filed a lawsuit to drag the Danish brewer Carlsberg to court to prevent the firm from terminating a licensing agreement for some of its popular brands in Russia, Kommersant reported on Sunday. Carlsberg Group’s Russian unit Baltika was acquired by the Russian government in August after the company pulled out in response to the ongoing war in Ukraine. The business was transferred to Russia's Federal Property Management Agency as Western nations slapped a barrage of sanctions against Moscow, prompting the foreign firms to close down businesses. 

A ruling in the document dated September 25 accessed by Kommersant paper showed that the company requested the Arbitration Court of St. Petersburg and Leningrad Region to prohibit Federal Service for Intellectual Property Rospatent from altering the contracts with dozens of companies such as Tuborg, Kronenbourg, Seth & Riley’s Garage, Holsten and LAV.

It asked the court to terminate the processes by Carlsberg in Denmark to suspend the framework license agreement. The company said that it would suffer great losses due to 'the jurisdiction of disputes in Denmark and their termination.' Russia's President Vladimir Putin signed a decree that allowed the state to ‘temporarily’ manage shares belonging to French agribusiness Danone and Baltika in July. Since Russian President Putin ordered what he calls a "special military operation" in Kyiv, more than 1000 companies have ceased business in Russia. 

Carlsberg pulled out of Russia in response to war in Ukraine

Danish brewery group Carlsberg pulled out of Russia in response to the war in Ukraine, imitating the measure taken by its competitor, the Dutch brewing giant Heineken just hours before last year. The Copenhagen-based group, in a statement, said it was forced to resort to 'the difficult and immediate decision to seek a full disposal of our business in Russia, which we believe is the right thing to do in the current environment.' The company owned the Baltika Breweries, one of the largest brewing firms in Russia, and accounted for an estimated 10% of its sales in Russia. Its decision to shut down the outlets and pull out the business laid off 8,400 staff who protested the move.

Danish brewer's CEO Cees ’t Hart, in a statement, explained that the decision implied that Carlsberg 'will have no presence in Russia,' but the halt of business would have no impact on the Russian market that included Carlsberg's revenue and operating profits. The business “will be treated as an asset held for sale until completion of the disposal," the company said. Russia expressed objection as the firm announced that any profits emerging from the humanitarian crisis 'will be donated to relief organisations.'