Fortum has formally notified the administration of the President of the Russian Federation that it strongly objects the Decree No. 302 of 25 April 2023, based on which the Russian State Property Management, Rosimushchestvo, has seized Fortum’s Russian subsidiary PAO Fortum.
With its actions, the Russian Federation has caused the dismissal of PAO Fortum’s CEO and deprived Fortum of its shareholder rights. Russia issued the new presidential decree last month, which enables the authorities to introduce temporary asset management to assets owned by certain foreign entities in Russia. The Russian Federal Agency for State Property Management, Rosimushchestvo, which has been appointed as an interim asset manager, exercises the powers of the owner, but has no right to dispose of the property.
Crude violation of international law
Fortum’s power plants in Russia are the most modern and efficient in the market, and maintained to high industry standards. Fortum considers Russia’s actions to be a crude violation of international law and of Fortum’s rights as a foreign investor. Fortum is preparing to take all necessary measures to protect its rights under relevant international legislation. Fortum is analysing the overall impacts of Russia’s actions on the company and will communicate more in conjunction with announcement of its first quarter financial results on 11 May 2023.