UK hits Russia with British IT services ban
(2022/10/04)
- Reference: 1664872207
- News link: https://www.theregister.co.uk/2022/10/04/it_consultants_sanctions/
- Source link:
Fresh export sanctions were leveled at Russia by the UK last week, with IT consultancy among other professional services that are banned.
The [1]move came in response to the illegal annexation of the Ukrainian regions of Donetsk, Luhansk, Kherson, and Zaporizhzhia after Russian president Vladimir Putin held sham "referendums" in the final week of September.
Under the new sanctions, Russia will lose access to not only to British IT consultancy, but architectural services, engineering services, and transactional legal advisory services for certain commercial activity – described by the UK government as "major western services that Russia depends on."
[2]
It's hard to quantify exactly how much of Russia's IT services originate from the UK, with the Foreign Office saying it was moving in "lockstep" with other countries, explaining that the largest country in the world (at 17.1 million km²) imports 67 percent of its services from sanctioning countries.
[3]
[4]
The IT consultancy services banned include those:
designing IT systems and software applications. Alongside the UK's previous ban on quantum computing exports and computing services, and with over 170,000 IT specialists fleeing Russia since the invasion began, these measures will erode further Russia's ability to maintain technological development with the rest of the world.
It's unclear whether the impact will be particularly large – not many UK IT consultancies have been doing work in Russia, with Investment Monitor estimating most British orgs had [5]already withdrawn by May this year , and no mentions of UK firms on Yale School of Management's list [6]of 1,000 companies who have withdrawn from the region.
While a [7]2018 Overseas registry doesn't even mention Russia as a region, a few UK IT companies did previously have a presence in the country. Capita, which said [8]earlier this year it had "minimal interactions" with Russia and Belarus, already stated it planned to cease any business activities and supply chain dependencies in March this year, "because it is the right thing to do," and Computacenter had cut ties by [9]September last year [PDF].
Three of the "big 4" global consultancies – PwC, [10]EY , and KPMG – said they'd [11]stop serving Russia-based clients in March , with [12]Deloitte cutting ties in May . [13]Accenture , which had [14]2,300 staffers there , also pulled out of Russia in March.
[15]
Large US-based IT consultancies including Boston Consulting Group and New York-headquartered McKinsey, which appears to have operated in Russia for over 20 years, have also [16]suspended work with clients in Russia.
[17]How one Ukrainian software maker planned for survival as invaders approached
[18]UN's ITU election may spell the end of our open internet
[19]Microsoft warns of North Korean crew posing as LinkedIn recruiters
[20]Russian devs plan alternative Android app store after Google Play bans paid apps
Do you know any IT consultants who will be hit by the export sanctions? Get in touch [21]here . ®
Get our [22]Tech Resources
[1] https://www.gov.uk/government/news/sanctions-in-response-to-putins-illegal-annexation-of-ukrainian-regions
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YzwEP7x@ydd8YgcHc8hkWAAAAIA&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YzwEP7x@ydd8YgcHc8hkWAAAAIA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YzwEP7x@ydd8YgcHc8hkWAAAAIA&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://www.investmentmonitor.ai/special-focus/ukraine-crisis/british-uk-companies-russia-withdrawn
[6] https://www.yalerussianbusinessretreat.com/
[7] https://www.gov.uk/government/publications/overseas-registries/overseas-registries#registries-in-asia-south-and-south-east
[8] https://www.capita.com/news/capita-ukraine-update
[9] https://investors.computacenter.com/node/13831/pdf
[10] https://www.ey.com/en_gl/news/2022/02/ey-statement-on-ukraine
[11] https://www.ft.com/content/be3d59a3-d9b2-4303-946d-d61d32c2ff08
[12] https://www2.deloitte.com/ua/en/pages/press-room/press-release/2022/deloitte-no-longer-operates-in-russia-and-belarus.html
[13] https://newsroom.accenture.com/news/accenture-to-discontinue-business-in-russia.htm
[14] https://www.fnlondon.com/articles/accenture-to-shut-2300-strong-russia-business-over-ukraine-invasion-20220303
[15] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YzwEP7x@ydd8YgcHc8hkWAAAAIA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[16] https://www.consulting.us/news/7315/big-consultancies-move-to-cut-ties-with-russia-after-backlash#:~:text=The%20New%20York%2Dheadquartered%20firm,projects%20for%20non%2DRussian%20clients.
[17] https://www.theregister.com/2022/09/28/macpaw_ukraine_war/
[18] https://www.theregister.com/2022/09/29/itu_plenipotentiary_open_internet_fight/
[19] https://www.theregister.com/2022/09/30/microsoft_north_korea_zinc_threat/
[20] https://www.theregister.com/2022/03/30/sanctionfree_alternative_to_google_play/
[21] mailto:jkarabus@sitpub.com
[22] https://whitepapers.theregister.com/
The [1]move came in response to the illegal annexation of the Ukrainian regions of Donetsk, Luhansk, Kherson, and Zaporizhzhia after Russian president Vladimir Putin held sham "referendums" in the final week of September.
Under the new sanctions, Russia will lose access to not only to British IT consultancy, but architectural services, engineering services, and transactional legal advisory services for certain commercial activity – described by the UK government as "major western services that Russia depends on."
[2]
It's hard to quantify exactly how much of Russia's IT services originate from the UK, with the Foreign Office saying it was moving in "lockstep" with other countries, explaining that the largest country in the world (at 17.1 million km²) imports 67 percent of its services from sanctioning countries.
[3]
[4]
The IT consultancy services banned include those:
designing IT systems and software applications. Alongside the UK's previous ban on quantum computing exports and computing services, and with over 170,000 IT specialists fleeing Russia since the invasion began, these measures will erode further Russia's ability to maintain technological development with the rest of the world.
It's unclear whether the impact will be particularly large – not many UK IT consultancies have been doing work in Russia, with Investment Monitor estimating most British orgs had [5]already withdrawn by May this year , and no mentions of UK firms on Yale School of Management's list [6]of 1,000 companies who have withdrawn from the region.
While a [7]2018 Overseas registry doesn't even mention Russia as a region, a few UK IT companies did previously have a presence in the country. Capita, which said [8]earlier this year it had "minimal interactions" with Russia and Belarus, already stated it planned to cease any business activities and supply chain dependencies in March this year, "because it is the right thing to do," and Computacenter had cut ties by [9]September last year [PDF].
Three of the "big 4" global consultancies – PwC, [10]EY , and KPMG – said they'd [11]stop serving Russia-based clients in March , with [12]Deloitte cutting ties in May . [13]Accenture , which had [14]2,300 staffers there , also pulled out of Russia in March.
[15]
Large US-based IT consultancies including Boston Consulting Group and New York-headquartered McKinsey, which appears to have operated in Russia for over 20 years, have also [16]suspended work with clients in Russia.
[17]How one Ukrainian software maker planned for survival as invaders approached
[18]UN's ITU election may spell the end of our open internet
[19]Microsoft warns of North Korean crew posing as LinkedIn recruiters
[20]Russian devs plan alternative Android app store after Google Play bans paid apps
Do you know any IT consultants who will be hit by the export sanctions? Get in touch [21]here . ®
Get our [22]Tech Resources
[1] https://www.gov.uk/government/news/sanctions-in-response-to-putins-illegal-annexation-of-ukrainian-regions
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YzwEP7x@ydd8YgcHc8hkWAAAAIA&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YzwEP7x@ydd8YgcHc8hkWAAAAIA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YzwEP7x@ydd8YgcHc8hkWAAAAIA&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[5] https://www.investmentmonitor.ai/special-focus/ukraine-crisis/british-uk-companies-russia-withdrawn
[6] https://www.yalerussianbusinessretreat.com/
[7] https://www.gov.uk/government/publications/overseas-registries/overseas-registries#registries-in-asia-south-and-south-east
[8] https://www.capita.com/news/capita-ukraine-update
[9] https://investors.computacenter.com/node/13831/pdf
[10] https://www.ey.com/en_gl/news/2022/02/ey-statement-on-ukraine
[11] https://www.ft.com/content/be3d59a3-d9b2-4303-946d-d61d32c2ff08
[12] https://www2.deloitte.com/ua/en/pages/press-room/press-release/2022/deloitte-no-longer-operates-in-russia-and-belarus.html
[13] https://newsroom.accenture.com/news/accenture-to-discontinue-business-in-russia.htm
[14] https://www.fnlondon.com/articles/accenture-to-shut-2300-strong-russia-business-over-ukraine-invasion-20220303
[15] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YzwEP7x@ydd8YgcHc8hkWAAAAIA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[16] https://www.consulting.us/news/7315/big-consultancies-move-to-cut-ties-with-russia-after-backlash#:~:text=The%20New%20York%2Dheadquartered%20firm,projects%20for%20non%2DRussian%20clients.
[17] https://www.theregister.com/2022/09/28/macpaw_ukraine_war/
[18] https://www.theregister.com/2022/09/29/itu_plenipotentiary_open_internet_fight/
[19] https://www.theregister.com/2022/09/30/microsoft_north_korea_zinc_threat/
[20] https://www.theregister.com/2022/03/30/sanctionfree_alternative_to_google_play/
[21] mailto:jkarabus@sitpub.com
[22] https://whitepapers.theregister.com/
Re: So?
lglethal
That would actually require the Government to do some work to identify who is actually behind the shell companies purchasing those properties.
And you know this Government doesnt actually like doing anything that even remotely looks like work. So fat chance of that happening...
Re: So?
Binraider
They have the civil service to do actual work; which, even as a hardened leftie, you would be hard pressed to find me a more inefficient and ineffective org to get to do the job.
Re: So?
Dan 55
What, that wizened underfunded husk tasked with the day-to-day running of the country?
Then you wonder why things are... suboptimal.
Re: So?
Wellyboot
The Properties aren't going anywhere, there's no incentive to sell up when you're looking at a 100% loss due to sanctions and as we're not at war* with Russia they can't be seized as enemy property.
As time drags on, I'm sure some of these buildings will go the way of Chelsea FC with sale funds being frozen until sanctions are lifted - don't hold your breath, it could take decades.
*just a cold war with a very partisan interest in aiding the self defence requirements of a third party country.
Russia loses access to UK IT consultancies
Dan 55
This time next week central Moscow looks like a futuristic Jetsons city.
werdsmith
UK rewards Russia by protecting it from UK IT services.
So?
That'll really scare them! yea - right!
What about all the Russian 'owned' property in central London?