Tech giant bypasses sanctions to supply Russian market – Kommersant
South Korea’s LG Electronics has begun installing software for Smart TV adapted for the Russian market on television sets manufactured at its plant in Poland, Kommersant business daily reported on Monday citing market sources.
The devices supplied through a parallel imports scheme are pre-installed with Russian online cinemas and support the Alisa virtual assistant, the outlet said. TVs that are not adjusted for the Russian market do not support Smart TV functions, it added.
Russian retailers procure devices from other countries via parallel imports, a practice by which a non-counterfeit product is imported without the permission of the intellectual property owner via alternative supply channels. Russia legalized the mechanism to provide the market with goods that Western companies stopped delivering or producing in Russia because of sanctions.
Televisions are imported from LG's plant in Poland to Belarus where an assembly line for TVs destined for the CIS market has been created in the town of Mlava. From there, the devices are sent to Russia, a source told Kommersant.
By adapting the devices for Russia at its Polish plant, LG formally does not violate Western sanctions, but such actions could create problems for the company according to a lawyer at the EMPP Law Office, Mergen Doraev.
"If the Polish unit further provides Russian consumers with consulting services for software support, the company may face problems – from fines to criminal charges," he said.
LG Electronics suspended all shipments of goods to Russia last year due to the disruption in global maritime logistics in the wake of the conflict in Ukraine.
The company's share of Russia's TV set market slumped from 19.1% in January 2022 to 4.2% in January this year, the outlet said.
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