Decathlon has put in place “an opaque system” to continue selling its clothing in Russia, reveals Disclose

Despite its announced departure from the country, the French sports giant relies in particular on a “shell company” based in Dubai to export its products from Asia, in complete discretion. The company denies this, and explains that it is simply ensuring the transition with its local buyer.

On March 29, 2022, a month after the start of the war in Ukraine, Decathlon announced the end of its activities in Russia, like other Western brands, and under international pressure which then increased on the French sports giant. But according to an investigation by the investigative media Disclose, put online on Tuesday December 19, the French multinational, owned by the Mulliez family, “continues to supply the Russian market with products bearing its flagship brands: Quechua, Wedze and Kalenji”.

This investigation, which is based on internal company documents, open source videos and testimonies from former employees, reveals that “Decathlon has implemented a vast system of concealment of its exports as part of a supply contract signed with Desport [un repreneur local] for an amount of at least 12 million dollars”.

To supply its goods without being detected, the sports company diverts “certain products initially intended for European stores” and relies on a subsidiary of the brand, domiciled in Singapore, which sends cargo from Bangladesh to Dubai by plane. On arrival, a company “which has all the makings of a shell company” receives the goods and sends them back to Moscow. “Tens of thousands of products are affected”according to Disclose, such as Kalenji jogging jackets, Wedze ski jackets and Quechua pants and shoes.

“We are at the very least in a gray area”

In total, “the equivalent of eight containers of big size” arrived in Russia at the beginning of November from Bangladesh. Logistics data from the group, seen by Disclose, shows that deliveries were also made from Vietnam and China to Desport stores in Russia. Decathlon has most of its products manufactured in these three Asian countries.

The online media outlet interviewed a French corporate compliance expert to find out if these deliveries are legal. “We are at the very least in a gray area”he notes, observing that “the complexity of supply chains between Singapore and Dubai could be likened to circumventing sanctions”.

Without commenting specifically on Decathlon, Kevin Lefebvre, economist at the Center for Prospective Studies and International Information, analyzes for Disclose that “86% of textile products exported by France to Russia before the war in Ukraine could not have left the country today due to European Union sanctions”. When contacted, the deputy general manager of Decathlon, Jean-Marc Lemière, did not wish to answer journalists’ questions.

Decathlon reacted with a press release on Tuesday, shortly after the publication of the Disclose article. The group assures that it “no longer operates any stores, employs any employees or holds any interests in companies in the Russian Federation”. “In order to finalize” the sale of its activities and assets “to the ARM company which owns the Desport brand”the sports brand continues to provide, “for a limited time”, “a specific quantity of products to support the buyer and the launch of their activity, thus preserving the jobs of ex-team members”she justified.