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Believe Has ‘Suspended Activities’ in Russia, While Helping Local Acts Bypass Sanctions To Get Royalties

The French company says has stopped new hires, investments and music releases in Russia, and ended links to "all Russian artists and labels" under sanctions.

LONDON — In just over two weeks, Russia’s once-burgeoning music industry has ground to an abrupt halt, with most major music companies suspending operations or closing offices in the increasingly isolated country following Vladimir Putin’s invasion of Ukraine on Feb. 24.

The list includes Universal Music Group, Sony Music Group and Warner Music Group, as well as streaming services Spotify, YouTube, Deezer and TikTok, and promoter Live Nation.


One notable exception has been Paris-based Believe, a music distributor and artist services company which is not only still active in Russia but is now advising its label and artist partners on ways to get around the economic sanctions that have crippled the nation’s banking system.

In a memo sent last week to its “partners,” Believe’s managing director in Russia, Denis Gorshkov, assures clients that it “continues to provide all services in Russia to numerous partners, labels, and artists.”

The memo, which Billboard reviewed in both the original Russian and an English translation, goes on to say that Believe’s local team is working on a regular basis and that Believe’s platform and distribution continue to function in Russia “without failures,” including making regular payments to partners “with the exception of payments to the accounts of banks under restrictions.”

For Russian labels and artists who have bank accounts frozen or inaccessible due to sanctions, Gorshkov recommended they use U.S. financial services company Payoneer to switch payments to a new account with a bank “not included in the restriction list.”

“Believe guarantees to make of all payment obligations in accordance with current contracts,” the memo concludes, “promptly adapting our solutions in accordance with ongoing changes.”

Believe has not commented directly on the memo since being contacted by Billboard late Friday. In a written response sent on Monday, after this story initially ran, a spokesperson told Billboard that Believe had “suspended activities in Russia,” including stopping new hires and investments in Russia; stopping music releases from Russian artists signed under artists services agreements; and had terminated relationships with “all Russian artists and labels under international sanctions.”

The spokesperson added that Believe “is continuing to fulfill its agreed upon obligations to our people, our artists and labels, including its payment obligations to Russian labels in full compliance with international sanctions.”

The company, which said it was also supporting humanitarian efforts for Ukrainian refugees, would not say whether it had closed its office in Russia. Nor would it respond to questions about what relations it had terminated with Russian artists — and whether it is still paying Russian artists and labels not under sanctions.

Since the invasion, the United States and its European and other allies have taken actions that target nearly 80% of all banking assets in Russia, including sanctioning Russia’s two largest lenders, Sberbank and VTB, and almost 90 financial institution subsidiaries around the world. The Treasury Department said on Feb. 24 that U.S. banks had 30 days to sever corresponding banking ties — which allow banks to make payments between one another and move money around the globe — with Sberbank and 25 of its subsidiaries.

U.S. and European officials have also banned Russian banks from using the SWIFT financial messaging system, which moves billions of dollars through more than 11,000 banks and other financial institutions around the world.

Further complicating matters, credit card companies Visa, Mastercard and American Express said they suspended operations in the country a week ago, as did PayPal. Those moves have essentially cut off the revenue flow for global streaming companies like Spotify, who can no longer receive payments from advertisers and new subscribers.

Payoneer, a fintech company traded on the Nasdaq, said last week that it was suspending access to its services in Russia. “Payoneer won’t accept any new customers, and after fulfilling its obligations toward its existing users in Russia, in line with its service agreements, services will also be halted for them,” the company said in a statement. “We cannot, with a clear conscience, support an aggressive government that has disrupted decades of peace in Europe,” Payoneer said, adding that it would “abide by all the relevant laws and regulations.”

Some of Believe’s competitors condemned Believe’s continued presence in Russia and its apparent efforts at encouraging partners to circumnavigate sanctions.

“Believe is doing nothing except acting like vultures to try and show that they are still in the marketplace,” one industry source familiar with the matter tells Billboard.

The French music company — valued at 1.6 billion euros ($1.9 billion) when it launched its IPO on the Euronext Paris stock exchange last June — has invested heavily in Russia, the world’s 16th-largest music market, which had revenues of roughly $200 million in 2020, according to IFPI.

Believe has had a local presence in Russia since 2013 and noted in a recent financial filing that Russia and Eastern Europe “have long been a high priority.” It has 50 people working in Russia, is active in 15 Eastern European territories (with a team of 25 people spread across those markets), and has a label portfolio with over 1,000 clients, the company said in November.

That month, Believe reinforced its local management team in Russia and Eastern Europe, including with the appointment of Gorshkov as MD, adding “key skills in digital and streaming services to prepare for the next phase of growth.”

Founded in 2005 by CEO Denis Ladegaillerie, Believe also owns digital distributor TuneCore and metal label Nuclear Blast.

In total, the company employs 1,401 people across more than 50 countries, according to financial filings. (Warner Music has the biggest staff in Russia among major music companies, with about 100 employees.)

In 2020, Believe provided services to more than 850,000 artists (either directly or through client labels), recording 728 million euros ($796 million) in digital music sales and 441 million euros ($482 million) in consolidated revenues.

That revenue comes from all over world, with Russia representing around 8-10%, or about 40 million euros ($44 million) of annual earnings, industry sources tell Billboard. Believe’s financial report for 2020 states that after excluding France and Germany, two of its biggest markets, 28% of its consolidated revenue was generated from other parts of Europe.

UPDATE: This article was updated on March 14, 2022, at 5:45 pm EST to include Believe’s updated response.