On Wednesday, Kommersant reported that international direct-sales cosmetic brand Avon has halted plans to exit the Russian market due to a steep exit tax, according to industry sources.

In March of 2020, the US-based multinational announced it would be ceasing investments in Russia as well as exports from its Russian plant overseas, due to the war in Ukraine.

In early 2023, Kommersant reported that the company was preparing to sell its plant just outside of Moscow, although the firm did not officially make known any decision to exit the country.

Industry sources indicated that Avon was negotiating with a number of investors, including the Russian manufacturer of cosmetics Natura Siberica as well as Arnest Group, which purchased Heineken’s Russian assets in August 2023. The company’s offer included the rights to its brand name if written in Cyrillic.

However Kommersant reported that in November the company informed potential buyers that it would not be signing any binding offers for the sale.

The reversal by the company was driven by Russia’s Foreign Investment Commission, which has a regulation whereby exiting foreign companies must sell their assets at half-price, according to a source for the paper.

Russian spokesperson Dmitry Peskov, commenting on the Western corporate exodus from Russia, said earlier this month, “those who are leaving are losing their position on the market. And of course, their property is being bought at a serious discount and taken over by our companies, which are doing it with pleasure.”

According to financial data, Avon, with revenues adding up to 13.89 billion rubles ($151.5 million) in 2022, is the second largest beauty products company in Russia.