Decathlon secretly supplying Russia through Dubai shell company and S’pore-based subsidiary: Report

PARIS – French sports retail giant Decathlon has secretly continued selling clothes in Russia despite officially pulling out in protest at Russia’s war in Ukraine, a media report published on Dec 19 said.

The multinational retailer, which posted sales of €15.4 billion (S$22.5 billion) in 2022, announced within weeks of Russia’s invasion of Ukraine that it would withdraw from the Russian market.

In October 2023, it sold its 60 local Russian outlets to Desport, the report in investigative media site Disclose said, a move that was presented as marking the end of its Russian presence.

“Except it wasn’t,” the report said.

In recent weeks, “very discreetly”, Decathlon had continued to supply Desport with products carrying its flagship brands Quechua, Wedze and Kalenji, Disclose said.

Citing internal documents, open-source videos and statements from former staff, Disclose said that Decathlon had put in place “a vast system to conceal its exports as part of a supply agreement with Desport” which it said was worth at least US$12 million (S$16 million), using a shell company in Dubai and a Singapore-based subsidiary.

The operation, Disclose said, took Decathlon “to the limits of legality”.

“I learnt in the summer of 2023 that Decathlon wanted to continue selling its products in Russia,” the media quoted an unnamed source who recently left the company as saying. “I immediately understood that it was a secret project.”

To meet Russian demand, Decathlon diverted part of its production originally earmarked for EU markets, and boosted output at Asian production sites, the report said.

EU sanctions following Russia’s attack on Ukraine on Feb 24, 2022, made it illegal to deliver weapons, luxury goods or equipment that could strengthen industrial capacity to Russia.

Sports articles are not on the list.

Asked for comment by AFP, Decathlon said that it “operates no stores in the Russian Federation, employs no staff and owns no stakes in active companies in the country”.

It added that Decathlon was doing “everything to stop the resale on Russian Federation territory of products purchased in Europe by third parties”. AGENCE FRANCE-PRESSE

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