The Insider reports that American-made Caterpillar heavy equipment is being supplied to Russia through an official dealer, the British company Vostochnaya Technika, despite Caterpillar’s announced exit from Russia and existing American and British sanctions.
According to The Insider’s report, more than $4 million worth of sanctions-violating deliveries occurred in the first three months of 2024. The news outlet states that over $24 million worth of equipment and spare parts manufactured by Caterpillar were imported into Russia during this period.
The leading importer is LLC Vostochnaya Tekhnika, a 100% subsidiary of the British VOSTOCHNAYA TECHNICA UK LIMITED. The Insider reports that more than 60% of the goods, by value, were made in the USA according to the “product origin” column.
The investigation reveals that VOSTOCHNAYA TECHNICA UK LIMITED is part of Barloworld, a major international supplier of industrial equipment. The company’s financial report for 2023 openly acknowledges the impact of the Russia-Ukraine conflict on its operations:
“The aforementioned is putting and continues to put pressure on the Vostochnaya Technica group (VT group) due to its activities in Russia. […] The Company and its subsidiaries are directly impacted due to the significance of the assets and operations in Russia.”
The Insider points out that this report suggests LLC Vostochnaya Tekhnika remains under the control of its parent company, unlike many businesses that have been “requisitioned for pennies or ‘suspended.'” It also indicates that the Russian subsidiary is a significant source of cash for the British company and that its activities are directly related to Caterpillar, which reportedly left the Russian market.
The news outlet reports that the immediate suppliers of Caterpillar equipment to “Vostochnaya Tekhnika” are the Mongolian LLC “Barloworld Mongolia,” Hong Kong-based Royal Stars Co., Limited, and Chinese Beijing Bocheng Trade Co., Ltd.
The Insider argues that Caterpillar must be aware that its dealer is trading its equipment in Siberia, citing Barloworld’s open declaration about continuing business (while referring to the war as the “Russian-Ukrainian crisis”) and the publicly available financial report of the British subsidiary through which business in Russia is conducted.
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