Swiss-based Nord Stream 2 declared insolvent due to Russia sanctions

AFP
AFP - [email protected] • 1 Mar, 2022 Updated Tue 1 Mar 2022 19:48 CEST
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Nord Stream parent company Gazprom. (Photo by Ina FASSBENDER / AFP)

Nord Stream 2, based in the Swiss canton of Zug, has gone belly-up after Germany halted the gas pipeline following Moscow's invasion of Ukraine.

Berlin halted the project, built to bring Russian gas to Europe, as Moscow faced sanctions from the West.

READ MORE: How Europe reacted to Switzerland’s historic sanctions announcement

"Nord Stream became insolvent because of last week's US sanctions," Silvia Thalmann-Gut, economics director in the Swiss canton of Zug where the company is based, told public broadcaster SRF.

She said the regional authorities had been informed Tuesday that the company had filed for bankruptcy and its entire workforce of 106 people had been laid off.

The United States and Germany announced last week that they were imposing sanctions on the Russian Nord Stream 2 natural gas pipeline project in retaliation for Moscow's invasion of Ukraine.

UPDATE: How Switzerland could be impacted by the Russian invasion of Ukraine

The targeting of Nord Stream 2 -- one of energy-rich Russia's highest-profile geo-strategic initiatives -- did not however prevent Moscow from launching a full-scale invasion of Ukraine on February 24.

The pipeline's project company -- Nord Stream 2 AG -- is based in Zug, and wholly owned by Russian energy giant Gazprom.

A number of other Russian firms have their headquarters in Zug, and Thalmann-Gut acknowledged that more bankruptcies might follow as the massive sanctions heaped on Russia over its invasion begin to bite.

Traditionally neutral Switzerland, which initially hesitated to impose its own sanctions on Russia, announced Monday that it would follow the European Union's lead and apply all of the same stiff penalties the bloc has imposed so far.

READ MORE: Switzerland to impose sanctions on Russia

The Swiss sanctions "have not yet played a role, so I cannot rule out that other companies will be affected," Thalmann-Gut said.

Asked if this would affect the wealthy canton's tax revenues, she said "it will undoubtedly have an impact".

"Very powerful companies are now affected."

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AFP 2022/03/01 19:48

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