Russian lawmakers approve harsher fines for foreign tech firms without offices

Russian lawmakers on Tuesday approved a bill providing for stricter penalties for foreign internet companies that fail to open an office in Russia, including fines.

Moscow has long sought to exert greater control over technology firms, and disputes over content and data have intensified since it sent armed forces into Ukraine on Feb. 24.

Foreign social media giants with more than 500,000 daily users have been obliged since July 1, 2021, to open offices in Russia or risk penalties ranging up to outright bans.

Now, the turnover fines that Russia has imposed on the likes of Alphabet’s (GOOGL.O) Google and Meta Platforms (META.O) for hosting banned content could be applied to companies that fail to open offices, after the lower house passed the bill in the second of three readings.

Fines could be as high as 10% of a company’s turnover in Russia from the previous year, rising to up to 20% for repeat violations.

The state communications regulator Roskomnadzor last November listed 13 mostly U.S. companies required to set up on Russian soil by the end of the year.

Only Apple, Spotify, Rakuten Group’s messaging app Viber and the photo-sharing app Likeme have fully complied – though Spotify closed its office in March in response to Russia’s actions in Ukraine and subsequently suspended its streaming service.

Meta, which Russia found guilty of “extremist activity” in March, is no longer listed, and its Facebook and Instagram platforms are banned, although its messaging app WhatsApp is not.

Four other companies have fulfilled at least one other Roskomnadzor requirement but have not established a Russian legal entity or office. Those were Google, Twitter, ByteDance’s TikTok and Zoom Video Communications, according to the government website.

The chat tool Discord, Amazon’s live streaming unit Twitch, the messaging app Telegram, the bookmarking service Pinterest (PINS.N) and Wikipedia owner Wikimedia Foundation have taken no steps to comply, according to the website. Reuters