Executives from Warner Music’s Russian arm, which includes artists such as Ed Sheeran and Dua Lipa, and French firm Believe, have continued to try to broker deals despite the suspension of business following the invasion of Ukraine, The Guardian has learned.
$15bn (£13bn) listed Warner Music – owned by Ukrainian-born billionaire Sir Leonard Blavatnik with US and UK citizenships – owns ADA Russia, which Zemfira collaborates with local independent labels and artists such as Gorky Park. The broader ADA operation counts artists including YouTuber and rapper KSI as clients.
Inside the Warner Music offices, a marketing email sent by an ADA Russia executive whose employee had a Warner Music email address attempted to do business with a local record label nearly a month after its parent company announced it was suspending all operations. Russia in March.
The email, sent in April and seen by The Guardian, seeks to discuss “potential collaborations” to offer high prices for a range of music services, citing a range of Russian artists the company already represents.
“I want to point out that we have a much higher streaming rate, we can also release vinyl records, and we offer advanced analytics,” the executive said in an email. “Everything is ready and we want to show it with an example. We want to meet you and discuss all the opportunities and our potential collaborations in person.”
The division, which describes itself as the distribution arm of Russia’s Warner Music, does not work with well-known international artists signed to the world’s third-largest record label.
The email directly contradicts Warner Music Group’s March 10 announcement that it “suspends operations in Russia, including project investment and development, promotional and marketing activities, and the manufacture of all physical products” following the February invasion of Ukraine.
A Warner Music Group spokesman confirmed that the executive should not be doing business in Russia and said an investigation had been launched.
“We suspended operations in Russia in March,” he said. “This email is over five months old and it should not have been sent. We are investigating what happened and we have also reiterated the suspension rules to the local team.”
Despite the violations by the music executive, the Russian business is not believed to have violated Warner Music’s rules in its day-to-day operations.
However, the French music group Believe, which has collaborated with artists such as Slayer and La Roux, has continued on a larger scale in Russia, including payments to the local streaming service, which was until recently owned by Russia’s largest bank Sberbank, which operates in the UK , EU and US sanctions lists.
Believe, one of France’s biggest tech companies valued at more than 800 million euros (£702 million) on the Paris Stock Exchange following the invasion of Ukraine, advised Russian partners on how to proceed with sanctions, while also saying it remained intact compliance with international sanctions.
Following an investigation by The Guardian, the company said it had halted recruitment and new investments in Russia, and suspended activities including the release of music by independent artists using its services, as well as termination of direct collaborations with local companies subject to international sanctions The relationship between the record company and the artist.
However, Denis Gorshkov, managing director of Believe’s Russian operations, is continuing to try to sign deals and new catalogues with artists.
An email seen by The Guardian included a follow-up to a €3m “new offer” with a Russian label to “monetize the new edition and post catalog”.
The company said this did not violate a promise it made in March, as it was a new deal with an existing partner, not a new investment in Russia.
“Believe is committed to peace and chooses to continue to work with local clients, artists and partners in the Russian market, complying with all applicable laws and regulations,” said a spokesperson for Believe. “Believe is maintaining all of its operations in Russia to To support its artists, record companies and keep its people safe and secure access to music production and distribution. Believe’s mission has always been to protect creations, artists, music and their people around the world, and to support teams and people.”
Founded in 2005, Believe launched in the UK in 2010 and listed on Euronext last year – and continues to hire staff for roles such as label manager and creative producer.
A spokesman for Believe said the new hires would replace natural employee turnover and did not represent an expansion of its Russian operations.
A financial report on Russian artist and Believe activity seen by The Guardian also revealed that the company was in business with local streaming service SberZvuk, which was until recently owned by state-controlled Sberbank.
In May, Sberbank, which bought the streaming service in 2020 to create a rival to Apple Music, Spotify and local rival Yandex, sold its stake as part of a wider divestment of positions in Russian tech companies following the invasion.
A month later, the UK also added the streaming service’s new owner, JSC New Opportunities, to its list of sanctioned businesses, saying the deal with Sberbank meant it “by carrying business to strategically important sectors, namely Russian information, Businesses in the Communications and Digital Technology Sector”.
Zvuk’s new owner, JSC New Opportunities, has not yet been sanctioned by the EU.
“Believe confirms that its assessment has concluded that Zvuk has never been sanctioned by the EU or the US for Believe activities,” the company said. “If Zvuk is subject to EU and/or US sanctions at any time, Believe will immediately remove the platform from the platform. remove all its catalogues and terminate any form of partnership.”
The company owns brands including New York-based music distribution platform TuneCore, and in 2018 acquired a controlling stake in Germany’s Nuclear Blast, one of the biggest labels in rock and metal music, with Actors like Slayer, Sepultura and Machinehead.
Other labels listed on the Believe brand page include: Allpoints France with Björk; AFM Records, which features Anvil and Lordi on its roster; and Naive, home of French performances M83 and Youssou N’Dour.