Google Files For Bankruptcy In Russia
Why Google Declares Bankruptcy in Russia?
Google shut down its ad platform in Russia on March 3rd after the Russian government requested it censor ads related to the conflict. Many tech companies have abandoned or cut off business ties with Russia over its invasion of Ukraine. There were a number of days in March when all of the major credit cards pulled out of Russia, making the normal business transactions impossible. The termination of Google Play paid apps was attributed to “payment system disruption.”.
A majority of countries use Google search. In Russia, though, Yandex is the leading search engine. Russia does not have any other video-sharing sites on the same level as YouTube.
The relationship between Google and Russia has been turbulent ever since the country invaded Ukraine. As a result, Russians are unable to access paid applications on Google Play. NashStore was created as an alternative app store by Russian developers as a result of this.
Contactless payments would be available in the new store since they would be compatible with Android and Russian bank cards. After sanctions, Google Pay became unavailable as well. It said the reason for the bankruptcy was the seizure of the bank accounts of Google Russia by the Russian authorities.
According to Fedresurs, Google had foreseen this filing.
Implications of Google’s bankruptcy in Russia
In a statement shared with Forbes, a Google representative highlighted how Alphabet intends to maintain YouTube, Gmail, and its search engine available for Russian citizens.
“PEOPLE IN RUSSIA RELY ON OUR SERVICES TO ACCESS QUALITY INFORMATION.”
— Google spokesperson
Business Insider reports that the spokesperson said the following regarding Google’s bankruptcy filing in Russia:
“THE RUSSIAN AUTHORITIES’ SEIZURE OF GOOGLE RUSSIA’S BANK ACCOUNT HAS MADE IT UNTENABLE FOR OUR RUSSIA OFFICE TO FUNCTION, INCLUDING EMPLOYING AND PAYING RUSSIA-BASED EMPLOYEES, PAYING SUPPLIERS AND VENDORS, AND MEETING OTHER FINANCIAL OBLIGATIONS.”
According to the Russian Federal Bailiffs Service’s database, two seizures have been recorded since mid-March. However, the sum of one seizure was not specified due to an unclaimed quantity. Google property and assets were seized, according to the service.
Google has relocated many of its personnel from Russia since the onset of the Ukraine crisis. However, some personnel remains in Russia.
The Russian government demanded that Google stop publishing ads about the war and censor its platform. All four major credit card companies pulled out of Russia over the next few days in March. As a result, regular commercial relationships became impossible. The decision to stop selling paid apps on Google Play was a result of this “payment system disruption.”.
Russia Seizes Google’s Bank Accounts
Google’s bank accounts have been seized by the Russian government. Google is no longer able to conduct business in Russia. Suppliers and vendors are being cut off, and employees are being laid off. Since revenues are not enough to cover costs, Google is in bankruptcy.
It was impossible for Google’s Russia subsidiary to pay its bills since it did not have an account. They are shutting down Google!
Google’s Russian subsidiary is planning to file for bankruptcy as it cannot pay its employees and suppliers.
A seizure of Google’s bank accounts by the Russian government forced Google to close its Russian offices. As a result, Google won’t be able to pay its staff or suppliers.
Google Heavily Fined By The Russian Government
Russia fined Google after the company refused to censor news about its invasion of Ukraine.
The Russian government fined Google and ordered it to remove any content deemed offensive by the government. In response to Google’s accessibility of information deemed unacceptable by the Kremlin, the Russian government has punished Google.
According to them, content deemed unacceptable must be removed, including Wikipedia. This includes any pages pertaining to Crimea.
Following the Russian invasion of Ukraine, Google suspended advertising in Russia in March. YouTube, owned by Google, has also banned ads on channels owned by state-backed media in Russia and has then blocked them completely.
Google was fined $98 million last December by Russia for failing to remove illegal content it considers on its platform. About 8% of Google’s revenues in Russia went to the fine.
According to Reuters, a Russian TV channel reported that authorities seized one billion roubles (about $15 million USD) from Google after it refused to reinstate its YouTube account. Google was also threatened by Russia’s communication regulator with a more modest fine of 8 million roubles (about $95,000 USD at the time these words were written) after it removed “illegal” videos from YouTube. The total amount of data Russia has seized from Google is unclear.
Russia Isolates Its People By Eliminating Technology Access
Due to death threats against Russian soldiers being made by Ukrainians online, Russia shut down social media.
It was part of the Kremlin’s latest efforts to isolate the Russian people. Attempts were made by the Russian government to block information about the Ukraine war.
As a result, Google banned ads targeting Russia. Google has also prohibited RT (formerly Russia Today) from using Youtube. It has also blocked news articles concerning the Syrian conflict.