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Ericsson keeps supplying Russia despite Ukraine invasion

A woman using a mobile phone walks in front an apartment block decorated with a mural in support of Russia's army 'special military operation' in Ukraine, in Moscow - Shutterstock/ MAXIM SHIPENKOV/EPA-EFE
A woman using a mobile phone walks in front an apartment block decorated with a mural in support of Russia's army 'special military operation' in Ukraine, in Moscow - Shutterstock/ MAXIM SHIPENKOV/EPA-EFE

Ericsson is continuing to supply mobile phone equipment to Russia despite pledging to halt operations in the country after Vladimir Putin's invasion of Ukraine.

The Swedish telecoms company applied for a dozen exemptions from local export controls on “dual use” products, according to Swedish Radio, the country's state broadcaster. Dual use products are those which can be used for military purposes as well as civilian ones. Examples might include advanced radios or GPS equipment.

Ericsson is one of two Western companies producing cutting-edge 5G network equipment, the other being Nokia. Last year Ericsson partnered with Russian telco MTS to launch a "private" 5G network for a gold mining company.

Seven of Ericsson's export licence applications were granted, said Swedish Radio, reporting that they were for civilian mobile phone network equipment. Such equipment is sanctioned because it can also be used by the Russian military for communications.

An Ericsson spokesman said: “The Swedish and EU authorities have granted limited exemptions for Ericsson and other companies to deliver technical assistance and software which are needed to maintain civilian public telecommunication networks.

“These exemptions expire by year-end and Ericsson is, and will remain, fully compliant with Swedish, EU and US sanctions.”

Sweden’s Inspectorate of Strategic Products, its export control regulator, said it would not grant any export licences for military-use or dual-use equipment destined for Russia.

In April, Ericsson said it was halting operations in Russia “indefinitely”, recording a £73m impairment and reportedly making 400 staff redundant.

The suspension came amid most of the Western tech world’s companies, including Ericsson rivals Nokia and Oracle, making similar promises of withdrawing operations from Russia.

Telecoms analyst Paolo Pescatore, of PP Foresight, said the revelation that Ericsson is continuing to support its Russian operations seemed to apply to “products shipped prior to the sanctions”.

He said: “Unfortunately this was never going to be clear cut as there’s existing equipment that needs to be maintained. A grey area which clearly must be addressed if there is going to be a complete exit from the market.”

In March, Ericsson admitted staff in Iraq had been bribing members of fundamentalist group Islamic State in order to keep up sales activity in the war-torn country.

The company said an internal investigation had uncovered the 2019 scheme, which included “the use of alternate transport routes in connection with circumventing Iraqi Customs, at a time when terrorist organizations, including ISIS, controlled some transport routes.”