Since the beginning of October last year, Decathlon has resumed operations of its online store and physical stores in Kyiv. This aroused great interest among Ukrainians, who accepted statements from official representatives of the company about a complete abandonment of business in Russia. However, following this investigation, many will be thinking carefully about their choice before visiting a Decathlon store.
Shell company in Dubai and subsidiary in Singapore: French sports retail giant Decathlon created a simple sanctions-busting system to continue selling its products in Putin's Russia even as it announced its exit from the country. Internal documents reviewed by Disclose journalists indicate that thanks to this secret contract, the transnational corporation earned at least $12 million.
On March 29, 2022, a month after the start of the war in Ukraine, Decathlon announced the cessation of its activities in Russia. International pressure has been mounting on the French sports retail giant, like other Western brands, to exit the Russian market as quickly as possible. The company's exit was formalized in October 2023 with the sale of 60 stores to a local buyer, the Desport brand. Decathlon's presence in Putin's Russia is officially history. But only officially.
For several weeks now, the French multinational corporation has been quietly supplying products to the Russian market under its flagship brands: Quechua, Wedze and Kalenji.
After conducting an investigation based on internal company documents, open source videos and testimony from several former employees, Disclose alleges that Decathlon created an extensive system to conceal exports under a contract with Desport worth at least $12 million. At the center of this scheme is on the verge of legality - top managers of the French group, a shell company registered in Dubai and a subsidiary of the brand based in Singapore.
Use of the word "Russia" was banned
“In the summer of 2023, I heard that Decathlon wanted to continue selling its products in Russia,” says a source who recently left the company. “I knew right away that this was a secret project.”
Back then, says a former employee with long-term contact with Decathlon subcontractors in Asia, “we weren’t allowed to talk about it with our colleagues. For those of us who knew, the use of the word "Russia" was prohibited. We should have used the code name: Sports_R."
The "secret project" with Russia was quickly set up, as evidenced by an email sent in September 2023 by Decathlon's European production manager. In an email seen by Disclose, the executive enthusiastically tells colleagues about the upcoming signing of a “supply contract with a new [Russian] buyer.” The confidential deal is expected to be worth $12 million, with 1.2 million items sold as quickly as possible in Desport stores.
To quietly deliver such large volumes in a short period of time, the sports group developed a strategy based on two tricks.
The first: the rerouting of some items originally destined for European stores, as evidenced by an email sent in September 2023: “For orders destined for Europe, please set aside some for Russia.” The production manager added that he received "the full support of Jean-Marc Lemierre", who is none other than the group's chief financial officer. Disclose journalists contacted Jean-Marc Lemierre but did not receive a response.
Shell company in Dubai
The second trick is more subtle and much more opaque. To fulfill the Russian contract, Decathlon resorted to the services of a subsidiary of Desipro, based in Singapore. With her help, the group urgently ordered goods from its Asian suppliers. But there was a problem, says a former Decathlon employee in Asia.
“Because of the war in Ukraine, we could not ask our subcontractors to export these goods directly to Russia. Deliveries would have been stopped by local authorities.”
The sports retail giant, clearly not above stunts, demanded that its Asian partners deliver their cargo to Dubai. Upon arrival, a company called Phenix Limited took delivery of the shipment as shown on the invoice for Quechua fleece jackets.
“Dubai is just a decoy,” a former Decathlon employee told Disclose. Phenix Limited has all the hallmarks of a shell company: not a single website, not a single registered employee on the Internet and only one contact in the Dubai commercial register: Sun Dubai, a firm specializing in the creation of offshore companies. In fact, “containers of Decathlon products shipped from Bangladesh never left Dubai airports,” adds our inside source. “They were immediately sent from there to Moscow.”
When transporting goods, large amounts of CO2 are released. Decathlon uses air freight only in exceptional cases - according to the company, 0.4% of its goods are delivered to their destination. In an internal logistics table dating back to October 2023, Disclose found references to Kalenji running jackets, Wedze ski jackets and Quechua trousers and shoes, which were shipped from Bangladesh to Russia via Dubai. We are talking about tens of thousands of products.
Business at its best
The first Decathlon products landed on Russian soil in early November.
“Despite all the difficulties, the first six deliveries cleared customs and arrived at the CSC [Continental Supply Center] in Moscow,” a cheerful Desport employee, formerly of Decathlon in Russia, wrote in an email to former colleagues on November 2.
The next day, one of the group's logistics managers confirmed in a separate message that 511 cubic meters of goods - the equivalent of eight large containers - "were shipped from Bangladesh to Russia." He added that "the import team wanted to test the process" and that, given the success of the operation, "supplies are now booming."
This statement contradicts the official position of the corporation. When Disclose contacted Decathlon about the Russian trade story, the company said it was "doing everything possible to stop the resale of [its] products in the Russian Federation."
Thus hinting that her clothes are allegedly being sold illegally by individuals on Russian e-commerce sites. But no mention of the goods that the group itself sends to Putin's country. Decathlon did not respond to the publication's request for additional information.
However, Disclose's investigation shows that the scheme designed to hide supplies to Russia does not rely only on Bangladesh. Screenshots of some of the group's logistics databases show that, since October last year, its offices in Vietnam and China have also been planning deliveries to Sports_R, the code name for Desport stores. It is in these three countries that Decathlon produces the majority of its products, which are distributed under 36 sub-brands.
Are these supplies legal or illegal, given international sanctions against Russia? “It’s a gray area to say the least,” a French corporate compliance expert told Disclose. He added that "the increasing complexity of supply chains between Singapore and Dubai could amount to sanctions circumvention." Kevin Lefebvre, an economist at the Center d'études prospectives et d'informations internationales, told Disclose, without commenting specifically on Decahtlon, that "86% of the textile products that France exported to Russia before the war in Ukraine are no longer may leave the country due to EU sanctions.”
On November 25, the first Desport store opened on the outskirts of Moscow. The store's sign - large white letters on a blue background - is very similar to the Decathlon sign. Customers were greeted with applause and cheers from 70 store employees. They formed a guard of honor for the occasion, as shown in a video published by Desport. The brand, which has since opened a further 16 stores in Moscow and St Petersburg, aims to replace Decathlon stores with 28 supermarkets by the end of December.
Quechua, B'twin, Rockrider, Wedze, Arpenaz, Forclaz: Decathlon brands can be seen in several videos posted by Russian Internet users on the social network VKontakte as they wander the aisles of Desport stores. Picking up the label on a pair of Kalenji pants, one exclaims, “Made in Bangladesh!”
Why don’t companies that still operate in the aggressor country join the ranks of the majority who have completely left the Russian Federation? It's simple: they put profits above human lives.
