Classified Russian customs service data obtained by Bloomberg show that more than half of imported semi-conductors and integrated circuits in the first nine months of 2023 were manufactured by US and European companies.
They included Intel Corp, Advanced Micro Devices and Analog Devices Inc. as well as European brands Infineon Technologies AG, STMicroelectronics NV and NXP Semiconductors NV. There’s no suggestion the companies breached sanctions laws and the data doesn’t indicate who exported the technologies to Russia, from where they were shipped and when the goods were manufactured.
The companies said they fully comply with sanctions requirements, ceased business in Russia when war broke out and put in place processes and policies to monitor compliance. They said they work to counter the illicit diversion of goods including with relevant authorities.
The trade underlines the difficulties facing the US and the European Union in choking off supplies of high technology to Russia’s war machine in repeated rounds of sanctions since the February 2022 invasion of Ukraine. It has enabled Russia to continue producing battlefield tanks and other weapons including missiles that have rained terror on Ukrainian cities.
The vast majority of restricted technologies enter Russia via re-exports from third countries including China, Turkey and the United Arab Emirates. The US and the EU have been working to block those routes, focusing especially on a list of high-priority so-called dual-use and advanced goods found in Russian weapons in Ukraine or that are critical to making them.
The EU is currently working on a new sanctions package and several member states are pushing the bloc to do more to crack down on companies in third countries as well as trades originating in the bloc as part of those proposals.
Distributors handle a significant proportion of the chip industry’s sales and they will in turn have multiple vendors. Manufacturers aren’t always required to track where their products go after sale to these companies, though some specific military-use chips must have a paper trail.
In all, the customs data showed Russia imported $1.7 billion of chips in the first nine months of last year, including $1.2 billion worth made by a total of 20 companies. Smaller producers, including some from Europe and the US, are likely to account for the remaining $500 million of chips.
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