State Presses Auchan Outlet Near Moscow

French retail giant Auchan has come under fire from the Prosecutor General's Office and the country's environmental watchdog, which says the firm is in "gross violation of the law."

The Natural Resources and Environment Ministry, which includes the watchdog, said in a statement Thursday that Auchan's oldest location in Russia was on a plot of government land reserved for an agricultural institute.

"I trust that the illegally seized land will be returned to the government, and the people responsible for the illegal use of the space will be punished," said Oleg Mitvol, deputy head of the environmental agency.

An Auchan official said on condition of anonymity that the company had not received any notice of the accusation.

"We bought this space in good faith, on a legal basis and with the blessing of the deputy head of the Moscow region administration," the official said.

The statement also quoted a letter to Mitvol from the Prosecutor General's Office threatening legal action over the land.

The stores in question -- Auchan's hardware megastore Leroy Merlin and its sporting goods outlet Decathlon, as well as an Auchan food retail outlet -- are on a 320-hectare plot in the suburb of Mytishchi, just north of Moscow.

In 2000, the area was leased to the private sector, in part to Auchan and real estate developer PIK Group.

Auchan opened the country's first European-owned hypermarket complex there in 2002.