Russia is considering ‘parallel imports’ after top brands halted sales

FILE PHOTO: Plastic letters reading “Sanctions” are placed in front of the colors of the Russian flag in this February 25, 2022 illustration. REUTERS/Dado Ruvic/Illustration

March 18, 2022

(Reuters) – Russia is considering allowing retailers to import products from abroad without the brand owner’s permission, the competition authority said on Friday after global brands halted sales or exports over its invasion of Ukraine.

Allowing “parallel imports” reflects how Russia’s retail sector has been turned upside down by Western economic sanctions and decisions by international companies like H&M and Nike to limit their operations in Russia.

The Federal Antimonopoly Service (FAS) said its head met with the director of Russia’s leading online retailer Wildberries, where legalization of parallel imports was discussed. Both sides were confident that the move would have a positive impact on consumers and Russian businesses.

The FAS said it has prepared draft regulations on parallel imports – sometimes referred to as “grey imports” – that the government is discussing.

“The FAS initiative enabling parallel imports will be an effective support measure. … Small and medium-sized businesses are allowed to legally import foreign goods without obtaining additional permits, and the consumer gets access to a wider assortment of high-quality goods at reasonable prices,” said Tatyana Bakalchuk, director general of Wildberries, in a statement.

“This is particularly important for societal goods such as medicines, groceries and children’s products,” Bakalchuk added.

The Russian government has proposed a range of aid measures to prop up its economy in the face of Western sanctions over the Ukraine conflict. Nevertheless, the Kremlin is facing the worst economic crisis since the collapse of the Soviet Union in 1991.

(Reuters report)