Yandex Head quits after surprise EU sanctions

The head of Russia’s biggest tech firm Yandex resigned on Tuesday night after being slapped with European sanctions in response to Moscow’s invasion of Ukraine.

Brussels hit Yandex executive director and deputy CEO Tigran Khudaverdyan with an asset freeze and travel ban earlier in the day, citing the company’s role in ‘covering up information’ from the Russian public by manipulation of search results on its platform.

Yandex – often dubbed “Google of Russia” – is the country’s largest search engine. His sprawling business empire also spans taxi services, e-commerce, fast food delivery, online education and a host of other tech-focused businesses.

“Yandex’s former information manager accused the company of being a ‘key element in withholding information’ from the Russians about the war in Ukraine,” the EU said in its official statement. logoutlining the sanctions against Khudaverdyan and a host of other Russian business figures.

“Furthermore, the company warned Russian users looking for information about Ukraine on its unreliable internet news search engine, after the Russian government threatened Russian media for what they publish. “, he added.

The Kremlin has launched a harsh crackdown on independent news sources since it invaded Ukraine, including a new law that could punish journalists with 15 years in prison for publishing stories about the Russian military campaign that use information not provided by the Russian government. Censors have also banned the use of the words “war”, “invasion” and “attack” to describe Russia’s actions in Ukraine – which officials call a “special military operation”.

Throughout, Yandex has been accused of suppressing independent news sources in its search results and promoting only state-run media on its online news portal, which tens of millions of Russians access each day. day.

After the imposition of sanctions, Khudaverdyan immediately resigned from the company, Yandex said in a statement published late Tuesday evening.

“We were shocked and surprised to learn that Tigran has been designated under EU sanctions, and we are extremely sorry to see him step down as Executive Director and Deputy CEO,” said John Boynton, US President. of the board of directors of Yandex.

In his role as chief executive, Khudaverdyan had been the de facto head of Yandex for several years, while founder Arkady Volozh officially remained the company’s CEO.

Lev Gershenzon, the former head of Yandex News quoted by the EU in its official gazette, said Yandex continues to be a catalyst in Moscow’s war against Ukraine.

“If the EU has decided that my position is correct and the formulation is successful – good for them,” he told the Moscow Times, referring to the bloc’s use of his criticisms to justify the move. imposition of sanctions against Khudaverdyan.

“I had a specific goal – to change the reports on the main page of Yandex, through which tens of millions of Russians are misinformed, and as a result of which, the continuation of the war is possible. This goal n is not yet achieved.”

Gershenzon, who worked at Yandex for eight years, including as chief information officer, welcomed the increased pressure on the company in recent days.

“People are talking and thinking. Some give up. The case of Marina Ovsyannikova was featured on the Yandex main page for more than 12 hours. There is international pressure and some refuse to cooperate [with the company]. The possibility of selling the information service of Yandex is considered discussed. These are all good moves, but unfortunately too slow.

Yandex itself, headquartered in the Netherlands and listed on the US stock exchange Nasdaq, was not sanctioned. In recent weeks he has warned of a possible default after the suspension of trading in shares of Russian companies, which could trigger a payment clause for holders of corporate bonds of the company.

For years, Yandex has taken a shaky path of compromise in an effort to keep the Kremlin on its side without being co-opted or taken over by the Russian state. This was accompanied by allegations of sharing user data with the country’s security services and entering a complicated property structure which gave the Kremlin veto power over the company’s international activities and transactions in sensitive areas such as personal data.

But the sanctions against Khudaverdyan came as a surprise and upended the understanding of what had previously been seen as acceptable compromises or the cost of doing business in Vladimir Putin’s Russia.

The Yandex boss, who was summoned to the Kremlin for a meeting between Putin and the country’s top businessmen, had been subtly critical of the war in Ukraine but resisted calls to more forcefully denounce Moscow’s actions.

“What is happening is unbearable. The war is monstrous”, Khudaverdyan wrote on Facebook in early March.

“A lot of people are demanding that the company immediately jump on an armored vehicle and shout our position. … But what is most important to us now is the safety of employees and maintaining the operability of our key services. We are not protecting our business, these are key services… taxis need to arrive, goods and food need to be delivered and infrastructure needs to work.

“For these reasons, we cannot ride the armored vehicle,” he said.

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