The Russian war of aggression in Ukraine has already lasted for more than 100 days – the long list of companies that have withdrawn from Russia in protest against the invaders and out of solidarity with Ukraine, or at least have stopped doing business in and with the aggressors until further notice , is younger – and it’s also getting shorter again.
It seems that many companies no longer want to forego the not inconsiderable income from the nation of 144 million people – and are therefore looking for ways to circumvent their own sanctions against Russia. To do this, the companies use legal loopholes that make their steps, if not moral, then at least legally irreproachable – and are supposed to maintain their position to the outside world while the ruble is rolling in for them again.
A recent and prominent example of this tactic is the French cosmetics, perfume and facial care manufacturer “L’Occitane”. The internationally successful beauty company from Provence had already caused a stir in April after it openly announced its intention to continue doing business in Russia. While the boycott list of other well-known companies was growing every day, on April 14 L’Occitane said its shops in Russia would remain open – only to do so three days later after a violent shitstorm and protests from customers to make a U-turn. L’Occitane closed its stores on April 17th and also stopped internet sales in the Russian Federation – but now Russian L’Occitane fans can easily shop their favorite French beauty products again.
How it works? With a “rebranding à la russe”: Everything remains the same – shops, products and the entire range – only the name is simply “russified”. L’Occitane has changed its name for Russia and incorporated its Russian operations under the same name as a separate line of business, or as a Russian company – the French firm now has two companies, one in Europe and one in Russia. And voilà: “Problem solved.”
An expert explains that this is a “perfectly acceptable legal step”: “This is a perfectly acceptable step that other international networks can also use,” says Ivan Samoylenko from the communications agency B&C Agency. And it looks like other well-known companies have actually already discovered this option for themselves.
The Zara brand, for example, has already openly toyed with the idea of changing its store signs to the Russian name – even before L’Occitane did it. Even if the fashion brand has since denied these reports, as Samoylenko further explains: “In this situation, the consent of the brand owner was not required. The company itself decided to change the name of its Russian representative office and register a new brand.”
And L’Occitane and Zara find themselves in “the best company” again: the number of retail chains that import their goods “by parallel import” is growing and growing. Every day you hear that this or that brand is planning or at least thinking about returning to Russia. “You have to understand that most companies have been under serious political pressure so far,” explains the Russian trade expert.
Experts therefore far from rule out that other brands could follow L’Occitane’s example: from Inditex (which owns the brands Zara and Zara Home, but also Pull & Bear, Massimo Dutti, Bershka, Stradivarius and Oysho) to IKEA there are many well-known names.
However, some retailers have already taken a different approach: they have not changed the name of their network in Russia, but have changed ownership. For example, Reebok stores in Russia are now owned by the Turkish holding FLO Retailing.