Ukraine says Russia takes over Ukraine-owned sweet factory in Lipetsk

by Reuters
Thursday, 20 March 2014 11:34 GMT

(Adds quotes, company reaction, background)

KIEV, March 20 (Reuters) - Russian authorities have taken over a Ukrainian-owned confectionery factory located in the Russian city of Lipetsk and halted production, the Ukrainian government said on Thursday.

Russian riot police took control of the Roshen factory on Wednesday and authorities had produced no documentation to justify "bursting on to the company's property", a joint statement from Ukraine's Foreign and Economic Ministries said.

A company spokeswoman said Russian authorities were investigating the firm, which was caught up in a trade row between Ukraine and Russia last year. Roshen's accounts in Russian banks had been frozen on March 14, she added.

"Their presence at our companies in Russia is based on the opening of a criminal investigation into Roshen's companies which are registered in Russia, including the Lipetsk factory," Inna Petrenko said.

She said she did not know the reason for the incident or what was likely to happen next.

Although the cause of the investigation was not immediately clear, it comes at a time of heightened tensions between Russia and Ukraine over the former's decision to annex the Black Sea peninsula of Crimea.

Last year, Russia also halted confectionery imports from Roshen in Ukraine citing health concerns, part of a series of trade restrictions on both sides.

The joint ministry statement said the incident "set a dangerous precedent, which could backfire".

"Now there is reason to believe that Russian authorities are setting about the actual confiscation of Roshen's production facilities located in Russia," the statement said. (Reporting by Natalia Zinets, Writing by Mike Collett-White, Editing by Angus MacSwan)

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