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French retailer Decathlon keeps trading in Russia despite exit claims – Disclose

Disclose investigation outlet reveals that Decathlon, after announcing its departure from Russia, continues to supply products through Desport stores using a network of shell companies.
Desport store in Russia.
French retailer Decathlon keeps trading in Russia despite exit claims – Disclose

French sports retail giant Decathlon has reportedly established a covert system to continue selling its products in Russia, despite publicly announcing its exit from the market. This clandestine operation, involving a shell company in Dubai and a subsidiary in Singapore, was uncovered by the Disclose investigation outlet. Internal documents reveal that Decathlon has profited at least $12 million from this concealed contract.

Decathlon products sold by a Russian Desport store, in a video shot on 26 November 2023 and published on social network Vkontakte. Credit: Disclose investigation outlet

Decathlon’s exit from Russia in March 2022, following the outbreak of Russia’s full-scale invasion of Ukraine, was a part of the wider Western corporate exodus. Officially, their Russian operations ceased with the sale of their 60 stores to Desport in October 2023. However, behind this facade, Decathlon has been discreetly supplying the Russian market with its flagship brands through a secretive project named “Sports_R.”

To avoid direct shipments to Russia, which could be halted due to the war, Decathlon used its Singapore-based subsidiary, Desipro, to order goods from Asian suppliers. These goods were then flown to Dubai, where a shell company, Phenix Limited, would reroute them to Russia. The use of Dubai as a transit point was a key part of this subterfuge.

Invoice dated 10 September 2023 drawn up by Desipro, Decathlon’s subsidiary in Singapore, and one of its Bangladeshi suppliers. The supplier is expected to send the Quechua fleece jackets – MH520 design – to Phenix Limited, a company based in Dubai. Credit: Disclose investigation outlet

The investigation by Disclose raises questions about the legality of these operations in light of international sanctions against Russia. While the complex supply chain maneuvers may exist in a legal grey area, they suggest a potential circumvention of sanctions. Kevin Lefebvre of the Centre for Prospective Studies and International Information told Disclose without commenting specifically on Decahtlon that “86% of textile products exported by France to Russia before the war in Ukraine could not have left the country now because of EU sanctions”.

Decathlon’s response to inquiries about continuing trade with Russia was non-specific, focusing instead on efforts to stop the resale of its products on Russian e-commerce sites, without addressing the direct shipments. According to the Disclose, Decathlon stated that the company is “doing everything possible to put an end to the resale of [its] products on Russian Federation territory.

The investigation also revealed that since October, Decathlon offices in Vietnam and China have been organizing shipments to “Sports_R,” the code name for Desport stores. Videos and photos from Desport stores in Russia show Decathlon brands still available in the Russian market, raising further questions about the company’s adherence to its public stance on the Russian exit.

Screenshot of Decathlon’s Logistics Information System seen by Disclose. It shows that the office in Ho Chi Minh City, Vietnam, has scheduled a delivery to Sports_R for 7 December 2023. Credit: Disclose investigation outlet

Based on reporting by Pierre Leibovici, Disclose investigation outlet.

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