Relations between Finland and Russia have never been so deteriorated since the start of the war in Ukraine, which led the Nordic country to join the NATO military alliance. The latest chapter in this tension between the two countries occurred after the action of the National Enforcement Authority of Finland (an agency under the Ministry of Justice) to confiscate real estate assets that the Moscow government owns in the Nordic country. The property seizures began on October 24 and affected 40 properties with a total value of 35 million euros, according to the newspaper. Helsingin Sanomat.
The action was taken on the order of a court in Helsinki in connection with a decision handed down by the International Court of Arbitration in The Hague in April 2023. This international court ordered Russia to pay to the state-owned energy company Ukrainian Naftogaz more than 5 billion euros for this amount. compensation for the invasion of the Crimean peninsula in 2014, during which much of the company’s infrastructure was destroyed.
The Ukrainian energy company celebrated the Helsinki court’s decision in a statement, saying that “given that Russia refuses to voluntarily pay Naftogaz the funds provided for by the Hague ruling, we continue to use all mechanisms available to collect them. Today we take another step towards restoring justice. At the same time, we are taking active steps to enforce court decisions in other jurisdictions regarding Russian assets,” said Oleksiy Chernyshov, President and CEO of Naftogaz Group.
The Naftogaz company has also requested the confiscation of Russian assets in the rest of European countries, but for the moment Finland has been the first state to carry out these seizures, according to the local press. The Kremlin’s reaction to the freezing of millions of euros of real estate was not long in coming. The Russian Embassy in Finland sent a protest note to the Ministry of Foreign Affairs announcing legal action against Finland’s decision. For his part, Kremlin spokesperson Dmitry Peskov confirmed: “Of course, we will challenge this in court. Naturally, the Russian Federation will defend its real estate interests and therefore we will use all legal mechanisms to protect our interests.”
The Russian Embassy in Helsinki is not affected
Among the list of properties seized by the Finnish government, the building of the Russian Center for Science and Culture, located in the central Töölö district of Helsinki, stands out for its real estate value, as well as another office building of worth 10 million euros in the capital. State broadcaster YLE revealed the list and locations of the rest of the 40 Russian properties seized by authorities, half of which are diplomatic properties, including the residences of employees of the country’s embassies.
However, it was reported that the Russian embassy complex was not seized, as its diplomatic use is protected by the Finnish Constitution and international law. The rest of the seized property is very varied and distributed throughout the country, such as a 17-hectare plot of land located by the sea, which served as a summer residence for Russian diplomats. According to Finnish media, several houses were also expropriated in the Åland Islands demilitarized zone, including a 1.78 hectare residence believed to have belonged to Russian President Vladimir Putin in 2009.
A question of national security
Along with the freezing of Russian real estate, the Helsinki government is preparing legislation for this fall to completely ban Russian citizens and companies from purchasing real estate in Finland. According to a draft law made public, Finland would ban the purchase of real estate by citizens of states “whose home territory has been deemed to violate the territorial integrity, sovereignty and independence of another state and may threaten the security of Finland.” .”
According to the government, real estate owned by Russian owners is considered a potential danger to the country’s security and, therefore, the executive considers the approval of this law a priority. In September, the Defense Ministry reported that six permits for real estate transactions by companies and private buyers with Russian nationality had been denied.
Minister Antti Häkkänen justified these decisions by stating that “it cannot be excluded that the real estate acquisitions in question could threaten national security and hinder the organization of national defense or the surveillance and safeguarding of territorial integrity” . These six properties were located in the east of the country, close to the 1,400 kilometer common border with Russia and whose land posts have still been closed for a year.
Since the start of the war in Ukraine, the Finnish government has feared the escalation of tensions and the impact of a hybrid war led by the Kremlin which threatens strategic sectors such as telecommunications, infrastructure or cybersecurity. It is for this reason that the Ministry of Defense recently reported that in recent years 3,500 real estate assets linked to Russian owners had been monitored throughout the country.
“We consider it a potential threat to our security that Russian and other landowners are acquiring land near critical infrastructure,” Prime Minister Petteri Orpo said.
In recent years, Finnish media have repeatedly reported several cases of suspicious properties and real estate acquired by Russian owners. Some striking cases have been those of unusually fortified forest cabins, summer residences equipped with helipads or the acquisition of logistics warehouses of no apparent value, but located near airports or border checkpoints, so that it was suspected that they could be used for espionage purposes. or sabotage actions. The Defense Ministry also clarified that until the ban was approved, the majority of real estate purchases by Russian citizens received approval, but the number of applications clearly decreased.
For Finnish Institute of International Affairs (FIIA) researcher Arkady Moshes, these actions are further proof of “the ruinous state of relations between the two countries, where any action or decision can be justified in favor of national security because of public opinion. The public sees everything through the prism of security. “Relations between the two countries could not be worse,” concludes the expert.
