The Russian Federal Tax Service has initiated legal proceedings against a local subsidiary of IKEA, the Swedish furniture manufacturing behemoth, seeking a hefty sum of $140 million, as reported by the business daily Kommersant. The tax authority’s complaint has been filed with the Arbitration Court of Moscow Region against Ikea Torg LLC, a subsidiary that still owns assets in Russia despite the company’s exit from the country amid Western sanctions over the Ukraine conflict.
The case, which surfaced in the arbitration case database on January 30, targets Ikea Torg, seeking a payment of 12.9 billion rubles ($142 million). While Ikea ceased its business operations in Russia last year and divested its factories, it retained ownership of certain assets. The Swedish company’s subsidiary, Ikea Torg, is currently in the spotlight, facing the tax authority’s claim.
Ikea Torg’s remaining asset in Russia is a warehouse located in the village of Yesipovo, situated outside Moscow. The warehouse, valued at more than 34 billion rubles ($374 million), previously served as a distribution center for Ikea’s retail outlets and online store. Following Ikea’s departure, the warehouse became a focal point, with the company reportedly seeking to rent it out for up to three years.
Despite Ikea’s efforts to maintain ownership of the property, the tax authority’s legal action raises questions about the nature of the tax dispute. Alexander Grinko, an expert in tax dispute resolution at Marillion Group, suggests that the tax complaint might not be directly tied to Ikea Torg or the Yesipovo warehouse but could involve another Russia-based Ikea subsidiary, even if no longer operational. Russian tax laws occasionally allow authorities to collect debts from interconnected companies through court rulings.
Yulia Korneva, a senior lawyer at K&P Group, emphasized that since Ikea Torg’s ultimate beneficiary is the Swedish parent company, the subsidiary could potentially be held accountable for any outstanding taxes owed by other Ikea structures in Russia.
As the legal battle unfolds, both the Federal Tax Service and Ingka Group, the Swedish company overseeing Ikea stores and Mega shopping centers in Russia, remain tight-lipped, refraining from commenting on the court filing and the tax dispute.
