Why did Google’s Russian Division Declare Bankruptcy?

In a piece of recent news, Google’s Russian division submitted a notice of intention to declare bankruptcy after officials seized its bank account. Thereby, making the office untenable to function.


Bankruptcy of Google’s Russian Division


Recently, Google’s Russian division submitted a notice of intention to declare bankruptcy after its bank account was seized by officials. According to a Google spokesperson, that “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.”

During the Russian invasion of Ukraine, Google also suspended most of its commercial activities in Russia, following the likes of many other companies. Despite that and the bankruptcy filing, Google’s Russian division will continue to provide Russians with access to free services such as Search, YouTube, Gmail, Maps and Android for the time being.


Impending Pressure on Content Platforms


In May last 2021, Russia fined Google around $82,000 for failing to delete thousands of pieces of content it deemed to be illegal. Authorities then fined the company approximately $98 million in December for similar reasons. That was estimated to be around 5.7 percent of Google’s 2021 turnover in Russia.

In recent months, telecoms regulator Roskomnadzor has been pressuring YouTube to lift restrictions on access to Russian media. A Russian TV channel reported last month that bailiffs seized around 1 billion rubles (approximately $15 million) from Google after it declined to restore the station’s access to its YouTube account.

While Russia has blocked many other platforms and services, including Google News, it doesn’t currently have plans to prevent users in the country from accessing YouTube. It said this week that residents would likely suffer as a result of such a move. Various media agencies reported that the streaming platform has around 90 million Russian users. Moreover, Russia’s minister for digital development also said that, despite testing its own, closed-off version of the internet, the country plans to stay connected to the global network.


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