Japan protests Russian takeover of Japan Tobacco subsidiaries in Russia

Japan has protested to Moscow after Russia placed four subsidiaries belonging to Japan Tobacco Inc. under the temporary management of a Russian company and demanded that the measure be withdrawn immediately, Japanese officials said Friday.

Chief Cabinet Secretary Minoru Kihara told reporters that the Japanese government is aware of Russian President Vladimir Putin's order imposed on the Japanese cigarette maker's subsidiaries that operate in Russia.

Japan sent senior government officials to Moscow, where they joined the Japanese ambassador to Russia to lodge a protest and demand the retraction of the measure “to make sure the legitimate interests of Japanese nationals and businesses are not violated,” Kihara said.

The takeover is the latest dispute between the two countries. Tensions have risen since Putin made a visit in August to Iturup, one of four Russian-controlled islands off Japan’s northern coast that Tokyo also claims.

The Soviet Union seized the Kuril Islands from Japan in the final days of World War II. The territorial dispute has prevented the two countries from signing a peace treaty formally ending their hostilities.

Tensions escalated in mid-October over the arrest of a Japanese journalist in Russia on suspicion of spying. Following Tokyo's demands that Moscow provide an explanation, consular access and humane treatment, Japanese consulate officials were allowed to meet the Hokkaido newspaper journalist in late October and confirmed he was in good health.

Japan Tobacco said in a statement Friday its four manufacturing subsidiaries in Russia have been placed under the temporary management of a Russian firm by presidential order.

The Japanese tobacco company said it was gathering more information, considering its response and assessing the potential impact on the group.

The move follows a growing number of cases since September in which Russia placed the assets of Western companies operating in Russia under temporary Russian control, Japan's Economy and Trade Minister Ryosei Akazawa said.

“To be honest, we have been cautious," Akazawa said. “We will continue to communicate with the Russian government in order to protect the assets of the Japanese companies.”

Finance Minister Satsuki Katayama, whose ministry holds a 37.55% stake in Japan Tobacco, told reporters Friday that she planned to “respond appropriately by cooperating closely with relevant ministries and JT, while watching the development.”