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Carlsberg terminates license agreements in Russia
FoodBev Media

FoodBev Media

5 October 2023

Carlsberg terminates license agreements in Russia

Carlsberg Group has informed Baltika Breweries that it has terminated the license agreements that enable Baltika to produce, market and sell Carlsberg products. Under the termination, there will be a run-off period stretching to 1 April 2024, where existing stock and materials can be used up by Baltika. The news comes in retaliation against what it described as Moscow’s illegitimate takeover of its Russian breweries in July. Carlsberg said this is “a response to the presidential decree issued on 16 July 2023 temporarily transferring management of Baltika to the Russian authorities”. In July, Vladimir Putin signed a decree stating that the Russian government would temporarily seize control of Carlsberg’s local brewer, Baltika, as well as various other global F&B companies’ Russian subsidiaries. In a statement, the beer giant said: “We have now concluded that we currently see no path to a negotiated solution for exiting Russia. We refuse to be forced into a deal on unacceptable terms, justifying the illegitimate takeover of our business in Russia.” “We are continuing to take all possible actions, including legal, to protect our employees, assets and operations.” According to Reuters, Russian court filings from 25 September showed that Baltika had sought to compel Rospatent, Russia's intellectual property agency, to ignore any requests from Carlsberg to terminate its access to brands such as Tuborg and Kronenbourg. The court rejected Baltika's request. "It is unclear, what formally will be the next steps in relation to Baltika,” Carlsberg said. “As Carlsberg Group, we retain title to the shares in the company while the temporary management is transferred to the Russian state. What the Russian state chooses to do under these circumstances is not clear.” “As a result, we will fully impair the value of our business in Russia,” the group added.

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