ZURICH, Switzerland: Russia has placed the local assets of food giant Nestle and French retailer Auchan under temporary control, in its most significant action against Western companies since seizing Danone's and Carlsberg's Russian businesses in 2023.

The assets were transferred to temporary control by L.E.V. Management, a little-known company with no public profile, under a decree issued by Russian President Vladimir Putin.

The Kremlin said actions by countries it considers "unfriendly" played a role in the decision.

"We are talking about European companies from unfriendly countries," Kremlin spokesman Dmitry Peskov said, adding that these states were "currently involved in the most active manner in military actions against our country".

Peskov did not name France or Switzerland. Russia says Western countries supplying weapons to Ukraine, including France, are effectively parties to the conflict. Switzerland does not supply arms to Ukraine but has imposed sanctions against Russia.

The Swiss government expressed concern over the move and said it was supporting Nestle in efforts to have it reversed.

Nestle said it was assessing the situation.

"Nestle is committed to taking all necessary steps to protect its rights and ensure continuity of business operations in the interests of all stakeholders, particularly its employees," the company said.

Nestle shares were down 2.4 percent at 1340 GMT.

Russia has progressively tightened control over foreign-owned assets since its 2022 invasion of Ukraine. A decree signed by Putin in 2023 allows assets belonging to companies from countries Moscow considers "unfriendly" to be placed under temporary administration.

Moscow has also used the framework to raise funds through forced sales, exit taxes and discounts, while rewarding Kremlin-linked insiders. A 2025 estimate by the Moscow law firm NSP put the amount of private property seized by the Russian state since the start of the war at more than $50 billion, including assets of foreign companies that left Russia.

Auchan operates 230 stores and an online business in Russia and employs about 30,000 people. The company declined to comment.

Nestle has six factories in Russia producing coffee, pet care and infant formula products and employs about 7,000 people. Its Russian operations generated about two billion Swiss francs (US$2.4 billion) in sales in 2021, the last year for which the company released figures.

Nestle has since scaled back its Russian operations, suspending most sales, non-essential imports and exports, advertising and capital investment.

Bank Vontobel analyst Jean-Philippe Bertschy estimates that Russia now accounts for around one percent of Nestle's group sales.

"While negative for sentiment and raising the prospect of an asset impairment or unfavorable disposal, we expect a marginal financial impact, given Russia's limited contribution to group sales," he said.

In previous cases, temporary administration has often been followed by state expropriation, with assets later transferred to Kremlin-linked individuals or companies. Peskov said only temporary administration was being considered for now.