French sports retail giant Decathlon has secretly continued selling clothes in Russia despite officially pulling out in protest of Russia's war on Ukraine, the investigative news outlet Disclose reported Tuesday.
The multinational retailer, which posted sales of 15.4 billion euros ($16.9 billion) last year, announced weeks after Moscow invaded Ukraine that it would withdraw from the Russian market.
In October, Decathlon sold its 60 local Russian outlets to Desport, Disclose's report said, a move that was presented as marking the end of its presence in Russia.
"Except it wasn't," investigative journalists wrote.
In recent weeks, Decathlon had continued to "very discreetly" supply Desport with products carrying its flagship brands Quechua, Wedze and Kalenji, according to Disclose.
Citing internal documents, open-source videos and statements from former staff, Disclose said that Decathlon had put in place "a vast system to conceal its exports as part of a supply agreement with Desport," which it said was worth at least $12 million, using a shell company in Dubai and a Singapore-based subsidiary.
The operation took Decathlon "to the limits of legality," the outlet said.
"I learned in the summer of 2023 that Decathlon wanted to continue selling its products in Russia," an unnamed source who recently left the company was quoted as saying.
"I immediately understood that it was a secret project," the source added.
To meet Russian demand, Decathlon diverted part of its production originally earmarked for EU markets and boosted output at Asian production sites, Disclose reported.
EU sanctions following Russia's attack on Ukraine made it illegal to deliver weapons, luxury goods or equipment that could strengthen industrial capacity to Russia, but sports articles are not impacted by the restrictions.
Asked for comment by AFP, Decathlon said that it "operates no stores in the Russian Federation, employs no staff and owns no stakes in active companies in the country."
It added that Decathlon was doing "everything to stop the resale on Russian Federation territory of products purchased in Europe by third parties."
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