Yandex warned investors of the risks of doing business in Russia
The online company, Yandex, issued an annual report containing a warning to investors regarding the risks involved in Russia’s tightening control over internet access on its territory.
In this regard, the company considered it necessary to warn investors of the possible risks on the Russian market. Such risks include inflation, economic sanctions, political motives, and the potential of authorities limiting business activities in the areas where it holds leading positions.
It was also noted that one of the initiatives which negatively impacts Yandex’s development is a proposal to regulate the news aggregator segment. Of specific concern is the provision prohibiting foreign persons from owning more than a 20% share in services where the audience is over 1 million people.
In the report, Yandex also recalled the attempt by authorities to regulate the online taxi service market, in which Yandex Taxi is the market leader. Thus, in August 2015, Yandex Taxi was investigated by the Federal Anti Monopoly Service.
“Public companies must tell investors about any changes in the sphere of regulation which can impact the company’s work and its services and also describe all risks, even hypothetical ones,” a representative of Yandex, Anna Ivanova-Galitsina, told RBC.
Five percent of Yandex belongs to the Baring Vostok group of funds which also manages pension and university funds in the US, several western European countries and Asia; Capital Research Global Investors has a 7% share; Comgest Global Investors has a 4% share and the EuroPacific Growth Fund has a 5.2% share. This means that the application of the law limiting foreign shares over 20% will result in serious changes to the company structure of Yandex.