Putin places Russian operations of tobacco giant JTI under state control
Russian President Vladimir Putin has ordered by decree that Japan Tobacco International's Russian businesses be transferred to a state-linked holding company. JTI is Russia's largest cigarette maker, with about 40% of the market.
Russian President Vladimir Putin on Thursday, 5 November, signed a decree transferring the Russian operations of Japan Tobacco International (JTI) to AO Promyshlennye aktivy, a state-linked holding company. JTI, headquartered in Geneva, is a subsidiary of Japan's JT Group and the largest cigarette manufacturer in Russia. The move adds another foreign business operating in the Russian market to the list of those brought under state management.
What the order covers
The decree applies to JTI's factories in St Petersburg, Rostov-on-Don, the Lipetsk region and the Leningrad region. The company employs around 4,000 people in Russia and holds roughly 40% of the country's cigarette market. Its brands there include Winston, Glamour, Camel, LD and Sobranie, as well as the domestic labels Pyotr I, Russky Stil and Donskoi Tabak.
JTI entered the Russian market in 1999 and acquired the local producer Donskoi Tabak in 2018. According to a company profile updated in November 2025, JT Group has invested $4.6bn in its Russian operations over more than 20 years. After Russia's full-scale invasion of Ukraine in 2022, the company did not leave the country but suspended new investment in production and marketing.
Background
The decision comes a month after Russia arrested Yuki Imai, a journalist with the Japanese newspaper Hokkaido Shimbun, on espionage charges. Russia's Foreign Ministry has accused Tokyo of systematically using journalists to gather intelligence; Japan rejects the accusation. Japan has a long-standing dispute with Russia over the Chishima Islands and has joined some Western sanctions over the war in Ukraine.
The same mechanism has already been applied to assets of several European companies, including Swiss food group Nestlé, French retailers Auchan and Leroy Merlin, and German retailer Metro. Moscow presents external management as a response to sanctions imposed after the 2022 invasion. Companies from states deemed "unfriendly" face caps on dividend payments and substantial fees on sales of Russian assets.
Putin said on 1 October that the mechanism also lets Russia prepare retaliation against any future nationalisation of Russian assets abroad, while leaving open the return of control to former owners if "conditions improved". External management means state-linked administrators are appointed to run a company's Russian assets without the foreign owner's consent or compensation.
