President Vladimir Putin has signed a decree giving Russian internet giant Yandex the green light to pursue planned changes to its governance structure, after concerning the management of Russian offshore companies, The Moscow Times reported.
Earlier this month, the Russian technology giant announced that it would be undertaking a company restructure. The decision followed lengthy negotiations with Kremlin officials, worried that foreigners could gain control of the privately owned internet giant.
The move by Yandex, which provides a raft of online services including taxi-hailing and the main Russian-language search engine,was criticized by some analysts who fear the Kremlin is trying to exert control over the privately-owned company.
The new structure will include a public interest foundation (PIF) run by a board of 11 Russian nationals with the power to block a single entity accumulating a 10% or more stake in Yandex, either in terms of ownership or voting rights. That is down from the current threshold of 25%.
According to a report by business newspaper Vedomosti from last year, President Vladimir Putin was personally involved in the talks with Yandex over the restructuring. The reason for such interest from the highest levels of power is the internet giant’s significant media activities — and the Kremlin’s lack of control over them.
“The process of taming Yandex is under way,” one source said. Then, this July a new draft law appeared: Duma deputy Anton Gorelkin submitted a bill that would limit foreign ownership of “significant information resources” to a maximum of 20% — Yandex was the clear target.
The company’s ownership structure had been brought into the spotlight by a draft law to limit foreign shareholdings in Russian internet firms to just under 50%. Three U.S. funds are among Yandex’s shareholders.
After Yandex’s announcement, Anton Gorelkin, the pro-Kremlin lawmaker behind the proposed foreign ownership legislation, said he would withdraw his bill and rework it.
Yandex said earlier this month its PIF will be incorporated in Russia’s western exclave of Kaliningrad, a special economic zone with favorable tax conditions.