Drones have played a key role on both sides in the conflict in Ukraine. While much attention has focused on Ukraine’s acquisition of UAVs from Turkey and Russia’s reliance on Iranian UAVs, less has been said about how small, mass market drones have been procured from the commercial market. Da-Jiang Innovations (DJI), a Chinese mass producer of quadcopters and one of the world’s leading companies in quadcopters, has seen its products become ubiquitous as Ukrainian and Russian forces fight trench-by-trench for control of the country.
Russia
The US Department of Commerce's Bureau of Industry and Security (BIS), the Department of the Treasury's Office of Foreign Asset Control (OFAC), and the Department of Justice have issued a joint compliance note on the use of third-party intermediaries or transshipment points to evade Russian and Belarusian-related sanctions and export controls. The note highlights the most common tactics used to evade these controls and provides guidance to companies on how to maintain an effective, risk-based sanctions and export compliance program.
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A Russian Orlan-10 drone captured by Ukrainian troops contained a Xilinx brand semiconductor in the drone's targeting system. The image taken of the drone was clear enough to show the product line and other identifying markers such as its place of manufacture. Using trade data, CNS researchers gathered import data on all imports of Xilinx brand products to Russia from the time period of January 2017 to October 2021.
Pavel Flider is a Russian émigré and naturalized American citizen who allegedly used his California company Trident International to transship advanced electronics to the Russian Federation. According to court documents, Flider did this using a series of fronts located in Estonia and Finland. The scheme was caught when U.S.
Tsvetan Kanev was less successful than Brazhnikov and his son, as detailed in Case Study 19. Tsvetan Kanev was indicted for violation of the International emergency Economic Powers Act and unlawful smuggling after he attempted to buy clock drivers and other controlled items and send them to Russia without a license. Mr. Kanev’s scheme fell apart when an attempt by Mr.
Alexander Brazhnikov Sr. was indicted after he allegedly moved an estimated $65 million in electronics from the United States to the Russian Federation from 2008 to 2014.[1] His customers allegedly included the Russian military, internal security services, and VNIIEF,[2] the latter of which is one of Russia’s most important nuclear weapons entities.
“The sanctions they applied on myself, on my companies and on my friends are absolutely unfair, absolutely fake and absolutely wrong” 48-year-old Ilias Sabirov told Reuters after allegedly caught selling radiation hardened chips to Russia without a license.[1] Radiation hardened chips, which require an export license due to their military uses, are one of the more sought-
INTRODUCTION
In December 2021, a Danish court fined and convicted the Dan Bunkering shipping firm and its parent company, Bunker Holdings, millions for dollars and gave a four-month suspended prison to the company’s CEO over a European Union sanctions-busting scheme.[1] The company was convicted of selling jet fuel to Russian companies, which in turn transferred the fuel on to Syria in contravention of EU sanctions. The company, which is the largest bunker supplier in the world, is alleged to have made 33 sales of jet fuel worth $102 million between 2015 and 2017.[2]
New export controls on semiconductors to Russia, in combination with sanctions impacting the Russian economy. Some estimates put the trade of semiconductors to Russia at $50 billion.[1] But these impressive number bely the fact that Russia buys end products with chips and integrated circuits and does not have a strong industrial base to produce cutting edge semiconductors themselves despite attempts by the Kremlin to build a domestic production capacity.[2]
Russia’s civil aviation sector is already in a deep crisis due to the growing package of export control and sanctions leveled against the country. The sanctions and export controls are affecting the country’s civil air fleet on multiple levels and exacerbating decades of neglect in key sectors of the country’s industrial base. The U.S. and EU sanctions, in particular, have led companies to freeze technical support, spare parts, supply of aircraft, leasing of aircraft, and maintenance to Russia. Around 700 of Russia approximately 900 aircraft designed for civil aviation will be affected in one way or another.
Russia’s civil air fleet is overwhelmingly reliant on Western manufactured engines. Previous rounds of sanctions have stimulated Russia’s domestic development of composite materials and avionics, but full commercial engines will be a difficult transition in conditions of near autarky. Aviation data acquired by the Wall Street Journal shows that of commercial aircraft serving of in storage in Russia, there are 370 Boeing aircraft and 345 Airbus. The third most-popular planes are produced by Sukhoi, but these airframes are reliant on joint Russian-Western partnerships. According to the analysis of the Wall Street Journal, only 17% of Russia’s domestic air fleet is domestically produced.