A Russian court's order for Austria's Raiffeisen Bank International to pay 2 billion euros ($2.1 billion) in damages for a collapsed deal shows Moscow's determination to strike back at the West, with companies bearing the brunt of the fallout.
Monday's ruling, delivered to a courtroom where armed men in balaclavas sat among those involved in the case, is a blow to the biggest Western bank in Russia, which has made billions of profits there during nearly three years of conflict with Ukraine.
It marks a watershed for the bank that has provided a payments bridge for Russia's middle class and companies into the West, requiring Raiffeisen to set aside a substantial amount for the loss even as it seeks to challenge the ruling, Reuters reported.
The judgement, made as Donald Trump was being sworn in as US president, serves as a warning to others, and prompted accusations by Raiffeisen's lawyer that the court was biased and that the masked men were there to intimidate.
The Russian lawyers taking the action against Raiffeisen said the men in the courtroom were bailiffs there to ensure order, accusing their opponents of "bombarding the court with unfounded petitions".
The penalty, issued by a court in the Russian exclave of Kaliningrad, follows the collapse of a deal involving Raiffeisen to release a Russian-owned stake in an Austrian builder, which unravelled under pressure from Washington. Now Raiffeisen has been lumbered with the bill.
"This is a final warning to all Western companies that you cannot do business with Putin's Russia," said Helmut Brandstaetter, a liberal Austrian lawmaker in the European Parliament.
The move also coincides with a deterioration in relations between Russia and Austria, long close to Moscow but which has gradually been unwinding its ties, abandoning a multibillion-dollar deal in recent weeks to buy Russian gas.
"Raiffeisen was long enough warned to pull out," said Brandstaetter. "It also shows that any continued bond between Austria and Russia will lead to disaster."
INEVITABLE RETALIATION
The ruling adds to worries for Western firms still operating in Russia, which include the likes of food companies PepsiCo , Procter & Gamble and Mondelez, and Italian bank UniCredit.
Ian Massey of risk consultancy S-RM said it was part of "pressure tactics, including increasingly punitive exit terms, asset seizures, and now ... huge fines."
"In the context of Russia's increasing diplomatic and economic isolation, retaliation against Western corporate symbols was nigh-on inevitable."
Monday's decision sees Russia follow through on previous threats to target privately-owned assets.
Last May, Moscow said it would identify US property that could be used for compensation over losses from the seizure of frozen Russian assets in the United States.
Moscow has already seized some assets and forced through sales to hand-picked buyers, as was the case for French yoghurt maker Danone and Danish brewer Carlsberg.
The Kremlin controls which companies are allowed to sell up and demands a heavy discount on the sale price.
Almost three years after Russia sent troops into Ukraine, Raiffeisen's continued presence in Russia underlines the lingering ties between Moscow and Vienna - with Vienna having served as a hub for cash from Russia and former Soviet states.
That bond put Raiffeisen and Austria on the front line of a global push by the United States to isolate Russia.
The court dispute followed the failure of a deal that Raiffeisen hoped would allow it to unlock some of its frozen billions in Russia.
The case was centred on a claim by Russian investment company Rasperia against builder Strabag, its Austrian shareholders and the Russian arm of Raiffeisen.
Raiffeisen had sought to buy a stake in Vienna-based Strabag from Rasperia, which Strabag had linked to Russian tycoon Oleg Deripaska.
Washington identified Rasperia as part of a group of Russian companies still controlled by Deripaska, when it imposed sanctions on some of those involved, scuppering the deal.
A spokesperson for Deripaska reiterated that he had no links with the company at the heart of the dispute with Raiffeisen.
Raiffeisen has around 6 billion euros in Russia, earned from international payments and from billions of euros of Russian deposits, a person with knowledge of the matter has told Reuters.