Microsoft’s Russian Subsidiary Plans Bankruptcy Amid Intensifying Domestic Pressures

Microsoft Rus LLC, a subsidiary of Microsoft Corporation, has announced its intention to file for bankruptcy, as indicated in a notice on Russia’s official Fedresurs registry. This development follows increasing restrictions from Russian authorities, with President Vladimir Putin recently advocating for the replacement of foreign service providers like Microsoft and Zoom with domestic alternatives.

Key Points:

• Operational Scale-Down: After Russia’s invasion of Ukraine in February 2022, Microsoft began scaling down its operations in Russia by June 2022, citing changes in the economic outlook and the impact on its business.
• Regulatory Pressures: President Putin’s recent statements emphasize the need to “throttle” foreign service providers to promote domestic software solutions, increasing pressure on companies like Microsoft.
• Uncertain Future for Other Units: Microsoft has other entities in Russia, including Microsoft Development Centre Rus, Microsoft Mobile Rus, and Microsoft Payments Rus. It remains unclear how these units will be affected by the bankruptcy proceedings of Microsoft Rus LLC.

This move mirrors similar actions by other tech giants; notably, Google’s Russian subsidiary filed for bankruptcy in 2022 after authorities seized its bank account, rendering it incapable of paying employees and vendors.

For more details, read the full article on Reuters: Microsoft unit in Russia to file for bankruptcy, database shows.