Ukraine closes Wildberries – Business – Kommersant

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The largest Russian online retailer Wildberries, which entered the Ukrainian market in September 2020, may be forced to leave it. President of Ukraine Volodymyr Zelensky has imposed sanctions against the company and its owners, Tatyana and Vladislav Bakalchuk, implying the blocking of assets, a ban on the movement of goods and the transfer of technology and rights. Experts believe that following Yandex and Mail.ru, Wildberries will wind up its business in the country. The decision of the Ukrainian authorities can be challenged through the European Court of Human Rights (ECHR), but the process will take about two years.

President of Ukraine Volodymyr Zelenskyy signed a decree on the introduction of economic sanctions against the Russian online retailer Wildberries. The document was published on the website of the President of Ukraine. We are talking about blocking assets, stopping the movement of goods in Ukraine, bans on the withdrawal of capital from the country, transfer of technology, rights to intellectual property, etc.… In addition, sanctions were imposed on the owners of Wildberries Tatiana Bakalchuk (13th place in the Forbes rating with a fortune of $ 13 billion), Vladislav Bakalchuk, as well as top managers of the company Andrey Revyashko and Alexey Kuzmenko. The decree also applies to the Wildberries divisions in Poland, Armenia, Belarus, Kyrgyzstan and Kazakhstan. The representative of Wildberries did not promptly answer Kommersant’s questions.

Wildberries is the largest Russian online retailer. In the first quarter of 2021, the site’s turnover grew by 79%, to 134.7 billion rubles, the number of orders – by 108%, to 126.5 million year-on-year. In addition to the Russian Federation and Ukraine, Wildberries works in Poland, Slovakia, Israel, Germany, Belarus, Kazakhstan, Kyrgyzstan, Armenia, France, Italy and Spain.

The document does not provide the rationale for sanctions against Wildberries.

In January 2021, Ukrainian media reported that the State Committee for Television and Radio Broadcasting of the country made a corresponding proposal. The representative of the regulator then said that Wildberries sold books without evidence of publishing entities, paid sales taxes in the Russian Federation, some books were “anti-Ukrainian”, and the authors were included in the list of persons posing a threat to the national security of Ukraine.

Wildberries entered the Ukrainian market in September 2020. At that time, more than 3 million items of goods were available on wildberries.ua from 32 thousand brands of women’s, men’s and children’s clothing, shoes and accessories, as well as toys, sports goods, stationery, pet supplies, household and summer cottages. Delivery was carried out through logistics partners, at the start 8 thousand points of delivery were connected.

Boris Ovchinnikov, Managing Partner of Data Insight, suggests that the Ukrainian market did not play a decisive role in the structure of Wildberries’ business. Guided by this consideration and the experience of Yandex and Mail.ru services blocked in the country, he assumes that the company with a high degree of probability will not challenge the decision of the local authorities, curtailing business in Ukraine.

At the same time, Mr. Ovchinnikov notes that if, nevertheless, a decision is made to start a trial, this can help the Wildberries brand to be recognized in the international market.

The lawyer of AB EMPP Mergen Doraev believes that Wildberries have a chance to challenge the sanctions. To do this, you will need to go through all the courts in the country, and then apply to the ECHR, whose decision Ukraine must comply with, he says. According to Mr. Doraev, the entire process may take about two years.

The general director of Infoline-Analytics, Mikhail Burmistrov, notes that the entire international business in the structure of Wildberries’ revenue is still less than 5%. He calls the situation unpleasant, but not affecting the development of the company. According to the expert, the decision will not affect the logistics chains of Wildberries and will not reduce the pace of development of international business.

Anatoly Kostyrev, Alexandra Mertsalova

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