The Russian Patent Office Rospatent has transferred ownership of 43 vodka brands to the agricultural ministry. The move, which effectively nationalises a large chunk of this lucrative market, is the latest stage in Moscow's drive to bring the alcohol industry under state control.

Average vodka pre capita consumption of 15 litres/year, the highest in the world, generates some US$1.4bn/year turnover for 180 firms. These figures exclude the huge output from illegal distilleries. Sales rose 5% in the period January-September 2001.

The government wants to transfer the entire sector to state holding Rosspirtprom. Last year Rosspirtprom took a majority stake in Kristall, Russia's biggest vodka distillery. The campaign - described in the Moscow press as a 'Vodka war' - even saw Russia's elite commando force storm the premises of leading firm Soyuzplodimport in 2000.

Rospatent has set aside the recent $300,000 sale to Soyuzplodimport of rights to these 43 brands. It considers brand names such as Moscowskaya and Stolichnaya (well known even outside Russia), are alone worth several hundred million dollars.

The move will be challenged in the courts, with private vodka distilleries arguing it ignores their legal rights and damages Moscow's image in the West. Even the head of Rospatent admits his challenge to intellectual property rights "has no precedent".

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The World Market for Spirits 2001