Export and import of electronics in Russia

Household appliances and electronics (Russian market)

Main article: Household appliances and electronics (Russian market)

Chronicle

2024: Russian electronics importers almost completely abandon settlements in dollars and euros with foreign suppliers

In mid-January 2024, it became known that Russian importers of electronics almost completely refused settlements with foreign suppliers and distributors in dollars and euros. This is due to the current geopolitical situation, due to which problems with transactions may arise, and the difference in exchange rates leads to a significant increase in the cost of equipment.

According to the Izvestia newspaper, in 2023, almost all purchases of electronics by Russian companies were paid for by Chinese and Indian currency signs, as well as by currencies of other developing countries. Market participants, in particular, use the ruble, yuan, dirham, won, dong and rupee. The fact is that it is very difficult to transfer dollars and euros to anyone abroad due to sanctions from Western banks.

Pexels

Zhanna Romanchenko, CFO of distributor diHouse, points to several advantages of using alternative currencies. This is the absence of the possibility of a payment freezing, which allows you to get better conversion offers in settlements. As a result, both buyers and suppliers win. Other advantages include the absence of risks of traceability of shipments and correspondent banks from unfriendly countries, ensuring the rapid circulation of currency and the ability to reduce the number of intermediaries in deliveries.

It is also said that by the end of 2023, some Russian financial structures began to offer distributors mediation for settlements with foreign counterparties in cryptocurrency. This method is used by some small market participants. Experts point out that the Russian ruble is starting to play an increasing role in cross-border settlements. The growth of confidence in the ruble, according to analysts, strengthens Russia's position in international markets.^[1]

2023

10-15% increase in server and DSS imports

In 2023, about 126 thousand foreign servers and about 35 thousand data storage systems (DSS) of foreign production were imported into Russia, which is 10-15% more compared to the previous year. Compared to 2021, server imports increased by 1%, DSS - decreased by 1%. Such data on April 24, 2024 leads the newspaper "Kommersant" with reference to the source, which, in turn, refers to customs statistics.

Market participants interviewed by the newspaper confirmed the return of server purchases in the Russian Federation to the levels that were before the start of Russia's special military operation in Ukraine. Beeline Cloud noted that the return of indicators occurred, among other things, in monetary terms. Deliveries of ordered equipment by April 2024 take 6-8 weeks, the company said.

Freepik

The interlocutor of the publication among electronics manufacturers says that the cost and delivery time of equipment will be influenced by the situation with payment through foreign banks. In mid-April, Chinese banks began to block payment for electronic components and finished products from Russian legal entities, which could provoke supply difficulties.

The volume of the market in money is now much more difficult to calculate, since the cost of purchasing equipment varies depending on the supplier, logistics costs and other factors, - said Fplus, which estimated the supply of servers to the Russian market at 127 thousand units at the end of 2023.

Ivan Pokrovsky, Executive Director of the Association of Developers and Manufacturers of Electronics (ARPE), emphasizes that the need for server equipment in Russia is increasing by an average of 10% per year.

While the share of Russian products is small, the growth in demand for equipment increases the growth of imports, he said.[2]

Import of base stations to Russia increased by 15% to 85.7 thousand units

In 2023, 85.7 thousand communication base stations and their components (transceivers, remote radios and radio modules) were imported to Russia from abroad, which is 15% more than a year earlier. In monetary terms, the volume of imports of these products increased by 56% and reached $205 million. This is evidenced by the statistics of the Russian customs, published in April 2024.

As Kommersant writes with reference to these statistics, the bulk of the supply of base stations to Russia from abroad in 2023 fell on the products of Huawei, Ericsson and Nokia.

One of the sources of the publication familiar with the situation explained the significant increase in the import of base stations with the transition to purchases "in retail format."

There used to be long contracts and large volumes. Now even used iron is significantly more expensive than the new one before, "the source explained.

Another interlocutor of the publication said that the price of stations and components has increased significantly, commissions and transportation costs have increased, and there are no more discounts.

A source Kommersant among suppliers adds that it is easier to import components than base stations, and additional radio blocks allow you to increase the power of the base station. By 2024, the main task was to expand the capacity of the sites, and not to build new ones. In addition, operators are no longer engaged in purchases in stock.

According to one of the sources of the newspaper, close to telecommunications companies, Russian manufacturers of communication equipment fear the negative impact of parallel imports on the development of local industries.

The initial fuse of enterprises and operators to purchase Russian analogues, in fact, disappeared, - says the informant of the publication.

Taking into account the existing base stations and the current coverage of the territory of all operators, plans for the construction of sites for the placement of new equipment per year do not exceed 4-10% of the network volume, added one of the sources of Kommersant^[3]

Tablet imports to Russia decreased by 27%. The leader has changed in the market

In 2023, 1.32 million tablets were imported to Russia, which is 27% less than a year earlier. This is evidenced by data from analysts at GS Group, published in early February 2024. Read more here.

The share of official imports of laptops has increased in Russia

In 2023, 33% of laptops were imported into Russia using parallel imports, while in 2022 this share was. Thus, the official import of portable PCs in the Russian Federation has grown. This is evidenced by the data that analysts at GS Group released in January 2024.

As Kommersant writes with reference to customs statistics, in 2023 a total of 2 million laptops were imported into Russia, which is 41% less than a year earlier. According to the source of the newspaper, in 2023 the share of Russian laptops increased, but most of these products are supplied in the public sector, while in "retail domestic vendors are almost invisible."

33% of laptops were imported into Russia using parallel imports

The GS Group associates the reduction in the share of laptops imported using parallel imports with the fact that a number of Chinese electronics vendors officially entered the Russian market in 2023. The source of the publication in the electronics market calls another reason: according to him, in 2023, Russian laptop manufacturers increased the production of equipment and entered the consumer segment, reducing the need for distributors to import in parallel.

The GS Group noted that with the exception of Apple, almost all foreign manufacturers of consumer electronics who officially left the country lost their positions in Russia at the end of 2023.

Fyodor Boyarkov, vice president of production development at GS Group, told the publication that it is necessary to "think about banning parallel imports" in order to give an impetus to the increase and development of production of domestic equipment. Anton Guskov, a representative of the Russian Association of Trading Companies and Producers of Electric Household and Computer Equipment, completely disagrees with his opinion. In his opinion, parallel imports as a mechanism must be preserved. A complete rejection of it can lead to a shortage of equipment and a decrease in competition "in some segments of consumer electronics."^[4]

In Holland, a Russian was sentenced to prison for supplying chips to the Russian Federation

On November 2, 2023, it became known about the verdict against a Russian accused of supplying chips to Russia bypassing sanctions. A court in Rotterdam sentenced Dmitry K. to 18 months in prison.

In addition, his company must pay a fine of 200 thousand euros. As noted by the publication CNews, a citizen of the Netherlands in this case would have escaped simply with a fine. At the same time, the sentence turned out to be milder than expected - the prosecutor's office requested a term of three years.

It became known about the verdict against a Russian accused of supplying chips to Russia

The convict was found guilty of violating EU sanctions on dual-use goods (these include microchips). As the court noted, the chips could "contribute to the military strengthening of Russian companies." One of Dmitry's customers was Rostec.

The convict had the opportunity to buy chips due to the presence of dual citizenship - Dutch and Russian. According to the documents, the chips were supposed to go to the Maldives, but in fact they went to Russia. For seven months of work, Dmitry's company thus earned 1.4 million euros.

The defense side claims that there are no facts of the use of goods for military purposes, and a year and a half in prison for the assumption is a lot and not fair. According to Alexander Treschev, an expert in the field of international law, this is due to Dmitry's Russian citizenship.

We live in a strange time and in a strange world where basic rights and tenets are violated. If earlier everyone was considered honest, until the opposite was proved, then we did not notice how almost all themids of Western countries shifted the burden of proving their innocence to the suspect, instead of law enforcement officers collecting the evidence base, Treshchev commented.

The number of lawsuits against Russians trying to import chips into Russia bypassing sanctions is growing. Arrests, proceedings and sentences for 2023 alone, except for Dmitry, took place in the United States, Germany and Cyprus.^[5]

Several Russians accused of illegal export of chips worth $7 million were arrested in the United States

On November 1, 2023, the US Department of Justice announced the arrest of five Russians suspected of illegally exporting dual-use goods to Russia, including chips. Two criminal cases were initiated, one of which arrested four Russians, the second case - three, but only one was arrested. Read more here.

Ministry of Digital Development of the Russian Federation opposes restrictions on parallel import of servers and DSS

On October 19, 2023, the Russian Ministry of Digital Development announced that it did not support the idea of ​ ​ restricting parallel import of servers and storage systems (DSS). Instead, the department proposes to take measures to reduce the possibility of price dumping of foreign manufacturers.

In early July 2023, it became known that the Ministry of Industry and Trade, Ministry of Digital Development and Russian electronics manufacturers are discussing new mechanisms for limiting parallel equipment imports. In particular, a proposal was considered to ban the import of any servers and DSS while maintaining the possibility of importing their components - boards, processors, memory modules, drives, etc.

The Ministry of Digital Development does not support the idea of ​ ​ restricting parallel import of servers and storage systems

According to Interfax, the position of the Ministry of Digital Development regarding the parallel import of corporate-class equipment was voiced by the head of the department Maksut Shadayev. According to him, various regulatory measures are being discussed against the background of the current geopolitical situation. At the same time, Ministry of Digital Development does not consider it necessary to introduce new rules restricting the parallel import of "heavy iron."

In terms of servers and DSS, it seems to me that the task of the state will now hold the positions that we have won. At the same time, parallel imports [need to] be preserved in the volume that is, "Shadayev said.

The Ministry of Digital Development noted that Russia has overcome the period of structural changes that followed after February 2022, when problems arose with ensuring stable supplies of servers and DSS. As of October 2023, the share of corporate-class equipment manufactured by Russian companies exceeded 50% of total sales. According to Shadayev, many suppliers, even from friendly countries, which in 2022 took a wait-and-see attitude, are trying to increase shipments of server equipment to the Russian Federation.^[6]

Ministry of Industry and Trade will extend the simplified import of foreign cryptographic equipment

On October 11, 2023, the Ministry of Industry and Trade of the Russian Federation published a draft resolution, according to which the permission to import foreign equipment with a cryptographic encryption function is extended until the end of 2024. We are talking about custom devices and enterprise-class solutions.

The agency intends to amend the government decree "On establishing the specifics of the import into the Russian Federation of encryption (cryptographic) means and goods containing them" of May 9, 2022. This document provides for the possibility of parallel import of cryptographic equipment until the end of 2023. Thus, the import of foreign devices is extended for a year.

Permission to import foreign equipment with cryptographic encryption function is extended until the end of 2024

The explanatory note to the draft Ministry of Industry and Trade states that the changes are being made "in order to minimize the risks of dependence of Russian importers on foreign manufacturers." The decree simplified the import of encryption tools, which are components for the industrial production of electronic equipment and equipment by companies included in the list of backbone organizations of the Russian economy. Encryption tools are used to protect data and ensure security when transmitting information over public networks. These are, in particular, equipment from IBM, Symantec, Cisco, Fortinet and other foreign manufacturers. Market participants say that at the time of import substitution for domestic companies, the presence of import solutions remains critical.

It is noted that the draft resolution complies with the provisions of the Treaty on the Eurasian Economic Union of May 29, 2014, as well as the provisions of other international treaties of the Russian Federation. The changes will not entail additional expenditures of the federal budget, the budgets of the constituent entities of the Russian Federation and local budgets, and will not affect the achievement of the goals of state programs.^[7]

How the Maldives, where there is "no chip market," came in second place in terms of their supplies to Russia

On July 21, 2023, information appeared that the Maldives became the second largest supplier of semiconductor chips to Russia. This tropical state in the Indian Ocean has actually turned into a transit point for trade with the Russian Federation, bypassing American and European sanctions.

During 2022, the Maldives sent approximately 400 thousand American-made chips to Russia. The total cost of these products is estimated at $53.6 million. The most noticeable increase in shipments was recorded in May 2022, when Aeroflot resumed flights between Moscow and the Maldives capital Male. This is indicated by the data of the Russian customs service, which was disclosed by the Indian research firm Export Genius.

Maldives sent approximately 400 thousand American-made chips to Russia

According to one of the leaders of the consulting company Omdia Akir Minamikawa, as such, there is simply no chip market in the Maldives. It is noted that in 2021, semiconductor products from this country were not supplied to the Russian market at all. However, in the current geopolitical situation, chips to Russia through the Maldives began to ship about a dozen companies. Moreover, they all do not have registration in the Maldives. These, for example, include Mykines, headquartered in London: it delivered chips worth approximately $40 million to the Russian market. In April 2023, the Financial Times business newspaper reported that this company had agreed to supply electronics to the Russian Federation for a total of $1.2 billion.

The Nikkei Asia resource reports that the supply of chips from the United States to Russia can be carried out according to the "transshipment" scheme through the intermediary country - without customs clearance on its territory. However, with such a model, there is a difficulty - it is necessary to find an "intermediate" forwarding agent who will agree to draw up documents for himself as the recipient of the product.^[8]

Japanese chips continue to arrive in Russia. 70% of supplies go through China

In mid-June 2023, semiconductors from Japanese manufacturers are still entering Russia, bypassing sanctions imposed shortly after the start of Russia's special military operation in Ukraine.

In March 2022, Japan joined the US sanctions and limited exports of domestic-made semiconductors. Although restrictions were introduced in stages depending on product characteristics and other factors, common semiconductors fell under the rules from the very beginning. Nikkei obtained Russian customs data from Indian research firm Export Genius and examined import records from February 24, 2022 to March 31, 2023. An analysis of transactions worth $50,000 or more showed that there were at least 89 semiconductor transactions in which Japanese manufacturers participated. These transactions included at least 2 million units of products and cost a total of about $11 million.

Japanese chips continue to arrive in Russia

Most deals go through third countries, according to the Nikkei. Thus, China, including Hong Kong, accounted for more than 70% of supplies. Daei is followed by South Korea and Turkey. The publication of the publication notes that Japanese laws regulating direct exports from Japan simply cannot stop the constant flow of chips and their outflow to different states of the world, from where they later enter the Russian market. Additional measures are needed to stop the indirect flow of goods and make sanctions more effective.

According to Nikkei, one Hong Kong-based trading company exported about four thousand semiconductors produced by Japanese Kioxia to Russia, and the deal amounted to $170 thousand. The company acknowledged that its products are subject to export controls and said it "requires its distributors to comply with each country's export regulations." Kioxia also reported that the company was unable to confirm a single case of products entering the Russian Federation, about further contacts with Japanese journalists, the company refused.

It also follows from the publication that the Chinese company King-Pai Technology supplied the Russian trading company semiconductors made by another Japanese manufacturer in the amount of $150 thousand. In June 2022, King-Pai was sanctioned by the US Department of Commerce for doing business with a Russian military company.

Leaders at the G7 summit said they would work to discourage evasion of export restrictions. Solving the problem of semiconductor proliferation, which includes complex ones, supply chains will also be a test for Japanese export controls. Japanese data to trade show that semiconductor exports to Russia in 2022 amounted to 150 thousand units, which is 85% less than in 2021. However, Japan, according to Nikkei journalists, cannot effectively regulate chip trade through other countries, as they do in the United States.^[9]

US State Department: Key electronics imports to Russia returned to levels that were before February 2022

By the beginning of 2023, imports of the main types of electronics to Russia returned to the level observed until February 2022. This was announced on June 8, 2023 by Jim O'Brien, sanctions policy coordinator at the US Department of State.

Due to the current geopolitical situation, many foreign companies have stopped supplying high-tech products to the Russian market. In addition, foreign contract manufacturers refuse to fulfill orders for customers from the Russian Federation. However, Russia managed to partially overcome difficulties thanks to cooperation with friendly countries - this circumstance, according to O'Brien, is a "significant problem" for the United States.

The difficulty for the West, according to O'Brien, is that European companies sell products to other countries, which, in turn, resell them to Russia. The US authorities, in particular, point to a similar situation with five states: Turkey, Kazakhstan, Georgia, the United Arab Emirates and Armenia.

By the beginning of 2023, Russia was able to re-import certain key categories of electronics at approximately the level observed a year earlier. Circumventing sanctions remains a significant problem, "O'Brien said.

The European Union is working on another package of sanctions against Russia, which could include "unprecedented measures against countries that continue to cooperate with Moscow." The formed geopolitical situation led to an increase in prices for electricity, fuel and food in Europe and the United States. Russian President Vladimir Putin said earlier that a policy of deterrence and weakening of Russia is a long-term strategy of the West, while sanctions have dealt a serious blow to the entire global economy.^[10]

Banks block payment from legal entities from Russia for servers, chips and processors

On June 7, 2023, it became known that banks of a number of friendly countries began to block payment from Russian legal entities according to the code of the commodity nomenclature of foreign economic activity (TN VED) 8542. We are talking about the purchase by companies from the Russian Federation of telecommunications equipment, various electronics, servers and components, including chips and processors.

According to the Kommersant newspaper, Kazakh, Armenian and Hong Kong banks do not accept payment for these products from legal entities from Russia. This is due to the introduction of the next package of sanctions by the United States. The restrictions also apply to "any provision of funds, goods or services in favor of or on behalf of a blocked person." A number of financial organizations, in particular, in Hong Kong, recognize that the blocking of transactions is associated precisely with sanctions pressure. Kazakh banks are also talking about tightening control over payments on products subject to Western sanctions.

Banks of a number of friendly countries began to block payment from Russian legal entities according to the code of the commodity nomenclature of foreign economic activity (TN VED) 8542

Against the background of the current situation, distributors are forced to change the delivery routes of equipment, laying them through China, Kyrgyzstan and the UAE. However, this leads to a further increase in the cost of products. Another possible solution to the problem is the import of components for the production of computers, servers, data storage systems and other equipment, under the "alternative" codes of TN VED (which ones are not specified). However, in any case, experts warn of an impending shortage of electronics and computer equipment: a shortage of such products could form by the end of 2023.

In the 84th and 85th groups of TN foreign economic activity, compliance control of banks has long been strengthened, problems can arise with almost any group of goods, for example, with printers, but so far this is selective and unpredictable, Kommersant quotes statements from market participants.[11]

The government will support Russian electronics manufacturers through customs duties

In May 2023, Prime Minister Mikhail Mishustin signed a decree on adjusting the rate of customs duties on a number of electronic products for legal entities. According to the document, the rate will be a fixed 30 thousand rubles - while the amount will not depend on the volume of the batch. Previously, the rate was floating and depended on the volume of the batch.

According to the press service of the Ministry of Industry and Trade on May 16, 2023, the innovation is aimed at ensuring a more balanced customs and tariff policy - regardless of the number of goods brought, the amount of customs duty will remain no more than 30,000 rubles. All funds from customs duties will be used to develop Russian electronics, scientific developments and create their own competitive products, the department added. It is assumed that the innovation will allow the authorities to increase subsidies for Russian manufacturers.

Customs fee for a number of electronic products for legal entities will be 30 thousand rubles, regardless of the volume of the batch

In total, 108 groups of goods fell under the new regulation: base stations, solid-state drives, smartphones, printers, recording equipment, game consoles, cameras and video cameras, thermostats, watches, sensors, counters, etc. As the director of logistics in the Russian distributor of electronics explained to Kommersant, the new decree actually equates the minimum collection threshold, which was previously 775 rubles, to the current maximum - 30 thousand rubles for goods included in the appendix to the decree. According to the interlocutor, the new rules will not affect the work of large electronics distributors, but "the work of companies importing small batches will be complicated."

The cost of importing test samples of new electronics, which distributors import for certification and testing, may also rise in price. For example, IoT devices, "he added.[12]

2022

Reduction of household appliance imports by 27.3% to 60 million units

In 2022, about 60 million units of household appliances entered the Russian market from abroad, which is 27.3% less than a year earlier. Read more here.

Decrease in imports of laptops and tablets by 24.3% to 6 million units

In 2022, about 6 million laptops and tablet computers were imported to Russia, which is 24.3% less than a year earlier. Such data in the analytical agency BusinesStat published in early October 2023.

As noted in the study, in 2022 the ban on the import of electronic equipment from, EU, and Switzerland Australia USA Japan mainly affected luxury goods and dual-use products that can be used by the defense industry. Countries that supported the sanctions accounted for less than 1% of total imports in 2021. Other factors had a more significant impact on the market:

• refusal to trade with Russia from foreign manufacturers (Acer, Apple, Asus, Dell, HP and others);
• technological sanctions. The US ban on supplying equipment to Russia, for the production of which American components are used, significantly complicated foreign trade relations with countries that did not support sanctions. Thus, Chinese companies (for example, Lenovo, Huawei, Xiaomi) have reduced the supply of electronics to Russia due to the risk of losing Western partners.

According to experts, the parallel import scheme, legalized by the Ministry of Industry and Trade of the Russian Federation in April 2022, made it possible to avoid a total shortage of foreign equipment. The list of goods approved for import from third countries without the permission of the copyright holder includes brands Apple, Asus, HP, Huawei, Lenovo.

As the consequences of the sanctions crisis overcome, laptop imports are expected to begin to recover from 2024. According to experts, US companies are not ready to return to Russia in the near future, but Asian business representatives like Acer, Lenovo and Asus are looking for opportunities to resume sales, according to a study published in early October 2023.^[13]

iPhone imports from India to Russia doubled

Parallel import of iPhones from India to Russia in 2022 reached 165 thousand devices. This is double the volume of shipments of Apple phones in 2021. This is evidenced by the data of the GS Group. Read more here.

Customs payments from electronics supplies to Russia decreased by 40%

Customs payments from the import of household appliances and electronics (computers, smartphones, large and small home devices) into Russia in 2022 decreased by 40% due to the departure of Western suppliers and an increase in the number of dealers who import equipment into Russia in small batches without issuing customs documents. Presumably, small regional networks can work according to this scheme. This became known at the end of January 2023.

The Holodilnik.ru believes that the fall in fees is associated with a reduction in the market as a whole. At the end of 2022, sales of household appliances and electronics fell by 10% in all categories, and in some months - by 20-30%, the company estimates.

Customs payments from the import of household appliances and electronics into Russia in 2022 decreased by 40%

As Kommersant writes in the issue of January 26, 2023, different duties apply to different categories of electronics and household appliances, from 0% to 15%. In addition to the duties on customs clearance, import VAT is also paid. If VAT is 20%, then the customs duty rate varies from product to product, for example, for vacuum cleaners - 3%, and for smartphones or computers - 0%.

For the calculation of customs payments, the customs value of the goods is important, since it is a taxable base. Parallel importers try to find goods at cheaper prices and can import electronics with a lower customs value.

In addition, the customs value also includes royalties, which are also subject to customs payments. Parallel importers do not conclude licensing agreements with brand owners and do not pay royalties.

Market participants are already offering the government a number of measures to rectify the situation, says Alexei Melnikov, managing partner of F + tech-Marvel Group of Companies. Among such measures are a ban on the import of those goods that are produced in the Russian Federation, the introduction of traceability of the receipt of goods, including through cross-border online sales, the introduction of waste collection for devices, as well as stimulating demand for Russian products, he told^[14]

Mishustin approved the simplified import of radio electronics into Russia

At the end of November 2022, the Government of the Russian Federation approved the simplification of the procedure for the import of electronic means and high-frequency devices into the territory of Russia.

Government decision: To approve the draft federal law "On Amending Article 71 of the Federal Law" On Communications "and submit it to the State Duma in the prescribed manner, - says the website of the Cabinet of Ministers

Mikhail Mishustin

Article 71 of the Law "On Communications" stipulates that the import and export of electronic means and high-frequency devices is carried out in accordance with the legislation and international treaties of Russia, the legislation of the Customs Union within the framework of the EurAsEC. As follows from Art. 22 of the Law "On Communications," on the territory of Russia are not subject to registration "radio electronic means used for individual reception of signals from TV channels and (or) radio channels, signals from personal radio calls (radio controllers), electronic household products and personal radio navigation means that do not contain radio-emitting devices," as well as on-board and ship radio stations.

In the spring of 2022, Ericsson and Nokia announced the termination of the supply of cellular equipment to Russia, which affected the provision of the Russian market with the necessary equipment. At the same time, in the spring, the Government of the Russian Federation legalized parallel imports to meet the demand for demanded foreign goods. One of the principles by which goods are included in the list is the termination of supplies to the Russian market.

According to forecasts of the Ministry of Industry and Trade, the Russian industry by 2030 will produce radio electronics for 6.3 trillion rubles, the industry will grow 17 times.^[15]

Earlier in 2022, the Cabinet of Ministers will simplify the rules for importing computers, tablets, laptops, smartphones, microcircuits and walkie-talkies into the Russian Federation. The government decided to temporarily empower industry associations to issue special permits.

Mishustin exempted printers imported into Russia from VAT

At the end of May 2022, Prime Minister Mikhail Mishustin signed a decree expanding the list of equipment exempted from value added tax (VAT) when imported into Russia. This list includes printers.

According to the press service, we are talking about technological equipment, analogues of which are not produced in Russia. In particular, this is a set of equipment for the production of large-sized reinforced concrete modules for housing construction. Also, a line of equipment necessary for the manufacture of MDF slabs has been added to the list.

Exemption of such equipment from VAT will help reduce the diversion of working capital of enterprises using it. In addition, the list of technological equipment that is not subject to value added tax includes rolling mills for the production of rails, beams and profiles, gas turbine generator plants, winding machines, folding and sewing machines.

Earlier in May 2022, Mikhail Mishustin said that the Russian Government would simplify the rules for importing electronics with built-in cryptographic means into the country. These include, for example, computers, tablets, laptops and smartphones. According to the prime minister, industry associations will temporarily give authority to issue permits, which will facilitate the import of equipment and ensure the needs of the domestic market.

The decree, which has already been signed, concerns notification for this technique. Notification is a special document that is required for all gadgets that support cryptographic capabilities or encryption.

In Russia, in order to obtain it and import devices, it was necessary to apply to the Center for Licensing, Certification and Protection of State Secrets of the FSB, but now, by the end of 2022, industry associations will be able to issue it.^[16]

The Russian government has reset duties on IT equipment for large investment projects

On May 16, 2022, Prime Minister Mikhail Mishustin announced the zeroing of customs duties for the supply of equipment to Russia, including technological, for investment projects. He noted that it is important to help Russian investors overcome the consequences of economic sanctions.

{{quote 'Additionally, we reset import duties on technological equipment, components, raw materials and materials that will be used in the implementation of large investment projects, primarily in agriculture, manufacturing, construction, transport industry and IT, - said the Chairman of the Government of the Russian Federation, who has already signed the corresponding decree. }}

The Russian government has reset duties on IT equipment for large investment projects

The list of priority activities approved by the new decree includes, among other things, crop production, the production of medicines, food and drinks, paper and paper products, electrical equipment, computers, vehicles, activities in the field of information technology, telecommunications, intercity and international passenger transportation, construction of buildings and structures, oil and gas production, exploratory drilling - a total of 47 items.

The list of investment projects that require foreign technological equipment, raw materials and materials will be formed by the subcommittee on customs-tariff and non-tariff regulation, protective measures in foreign trade of the legal commission on economic development and integration. It will be approved by the Government.

The volume of capital investments for each investment project applying for inclusion in the list should be at least 250 million rubles. The register of goods for duty-free import will also be approved by the Cabinet of Ministers. They can be used exclusively in Russia and only for the implementation of a specific investment project.^[17]

The procedure for issuing permits for the export of telecom equipment from Russia to the EAEU has been established

In March 2022, the Ministry of Digital Development of the Russian Federation approved the procedure for issuing permits by the department for the export of telecommunications equipment from Russia to the countries of the Eurasian Economic Union (EAEU).

The document establishes that the issuance of permission is carried out on the basis of an application of a legal entity, an individual entrepreneur or an individual presented in the form of a document on paper.

The Ministry of Digital Development, Communications and Mass Media of the Russian Federation approved the procedure for issuing permits by the department for the export of telecommunications equipment from Russia to the countries of the Eurasian Economic Union (EAEU)

Also, the application and the documents attached to it can be submitted in the form of electronic documents certified in accordance with the established procedure, using the Unified Portal of Public Services (EPGU) after the technical implementation of this opportunity. Such a service should be implemented at EPGU no later than December 31, 2022, the order says.

The department of stimulating demand for electronic products will issue permits. Within 5 working days from the date of receipt of documents, the Department checks the completeness and accuracy of the information contained in them, and also evaluates the possibility of issuing export permits.

At the same time, the order does not apply to the movement across the border by individuals of electronic equipment belonging to them, used for personal needs. Such a movement remains free and does not require permission, the Ministry of Digital Development explained.^[18]

Government Decree of 09.03.2022 No. 312 defines a list of goods and equipment previously imported into Russia from abroad that are temporarily prohibited from being exported from the country. The list includes technological, telecommunication, medical equipment, vehicles, agricultural machinery, electrical equipment - more than 200 items of goods in total.

The United States allowed South Korea to supply smartphones and cars to the Russian Federation

On March 3, 2022, the Ministry of Trade, Industry and Energy of South Korea stated that the American sanctions restricting exports against Russia do not apply to cars, mobile phones and other consumer electronics.

We are talking about the rules of direct foreign product (FDPR) introduced by the United States against the Russian Federation, according to which companies from third countries must obtain a license from the United States government for goods that are produced abroad using American technologies before they can be sent to Russia.

South Korea will continue to supply smartphones and cars to Russia

The South Korean authorities held consultations with the US Department of Commerce about anti-Russian sanctions. The US department explained that restrictions will not apply to household appliances, cars and smartphones, since these goods are intended for the mass consumer. The US Department of Commerce stressed that the restrictions do not apply if the end buyer is not a person associated with the defense industry.

It is noted that South Korean companies can also obtain permission for the planned delivery to their plants in Russia, their applications will be considered on an individual basis.

South Korea's Ministry of Trade, Industry and Energy also said that exports of goods from subsidiaries of South Korean corporations located in Russia and third countries could theoretically "be allowed," but in each individual case they would have to obtain a license. In addition, from the introduction of US sanctions on February 24 to March 26, 2022, there is a 30-day delay to adapt firms to sanctions.

Although South Korean-made electronics are allowed to be supplied to Russia, Samsung Electronics on March 5, 2022 announced the suspension of supplies of its products to the Russian Federation. The decision affected all Samsung products, including chips, smartphones and household appliances.^[19]

2021: Electronics to Russia began to be actively imported through Kazakhstan

On May 20, 2021, it became known that electronics manufacturers began to import equipment to Russia more often through Kazakhstan. The reason is that the FSB is delaying the issuance of documents. At the same time, in Kazakhstan, as RBC writes with reference to its sources, the procedure for obtaining permission "is more transparent and adequate."

Special permission - notification - must be obtained when importing any equipment with cryptography into the territory of the Eurasian Economic Union (EAEU). However, it is not necessary to draw up documents for the sale of smartphones and computers in Russia to the FSB - you can have a permission document from the regulator of any EAEU member country.

Electronics in the Russian Federation began to be actively imported through Kazakhstan

The publication listed several companies that began issuing permits to Kazakhstan: Intel, Lenovo, Huawei, HP Inc., Vivo, Samsung and Asus.

Eldar Murtazin, a leading analyst at Mobile Research Group, explained that in the second half of 2020 there were problems with registering notifications in Russia, which is why many manufacturers began to draw up documents through Kazakhstan. But, according to him, from the beginning of this year, vendors began to return to the execution of the document in Russia.

As a representative of one of the major manufacturers of equipment with cryptographic elements told RBC, after the start of the pandemic, the deadlines for issuing notifications to the FSB increased from ten days to at least a month.

Another RBC source, close to a company that helps manufacturers issue notifications, recalled that from March 25, 2020, direct acceptance of documents in the department was closed, they became necessary to be sent by Russian Post.

Due to the fact that documents are also sent from the FSB by mail to the Center for Licensing, Certification and Protection of State Secrets, the time for their consideration has increased and sometimes reaches 1.5 months, the source said.[20]

2020

Most of the chips in the Russian Federation come from China

According to the UN Statistics Center Comtrade, imports of chips from China to Russia at the end of 2020 approached $500 million. About which countries most semiconductors are imported into the Russian Federation can be seen in the graph below (published in June 2022).

Countries leading in the supply of chips to Russia

Radio electronics exports from Russia reach $3.4 billion thanks to missiles

In 2020, the export of radio electronics from Russia reached $3.4 billion, the Ministry of Industry and Trade said. As Vedomosti writes in the issue of June 15, 2021, referring to sources close to the ministry, approximately 95% of the supply of such products falls on air defense systems (air defense). The share of civilian products is only 5%.

As explained to the publication in the Ministry of Industry and Trade, air defense systems are the most complex electronic devices - they consist of electronic systems, which in general communication make up an electronic object that solves air defense tasks.

Radio electronics exports from Russia in 2020 reached $3.4 billion thanks to missiles

The ministry added that along with air defense systems, the Ministry of Industry and Trade also takes into account the export of telecommunications equipment, lighting products, medical equipment, niche solutions for digital power, radar equipment and laser technologies.

Civilian products are purchased mainly in Southeast Asian countries. Mostly Russian factories export their goods to China. There are also deliveries to Korea and Japan. But the lion's share is China and Taiwan, because China produces only 12% of microcircuits itself and purchases them, including in Russia, guided by the principle of value for money, explained Karina Abagyan, director of strategic development at the Micron plant.

Director of the Association of Russian Developers and Manufacturers of Electronics Ivan Pokrovsky considered it incorrect to include the export of defense complexes in the export statistics of electronic components, modules and blocks. In his opinion, it would be more correct for industry accounting to attribute the supply of electronic units for air defense systems to sales on the domestic market, since the production of air defense systems using electronic units and non-electronic products is carried out in Russia. Such a correction "may cast doubt on the achievements of the industry that the Ministry of Industry and Trade reported earlier," the expert added.^[21]

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