Britain has buckled under police "intimidation" and decided to close two regional offices of the British Council as Russian authorities have demanded.
The closures come after two days of escalating pressure by Russia's FSB security services on the Russian staff members of British Council offices in St Petersburg and Yekaterinburg.
Quoting Foreign Office sources in London, the BBC reported on Thursday that the British government has agreed to shut down the offices because it recognises that "Britain has few options left in the row."
The British Council, which operates as the cultural arm of Britain, has been under scrutiny in Russia for the past two years for failing to register as a non-governmental organisation and pay taxes on its revenues.
But most experts say that specific dispute is a minor technical problem that would be easily resolved between countries with normal relations.
"We're talking about the British Council here, an organisation that is known and respected the world over, and not some fly-by-night criminal group," says Masha Lipman, an expert with the Carnegie Centre in Moscow.
"It seems clear that the legal issues are not the main thing here. This is about international politics."