Acer Subsidiary Scored $74 Million Profit in Russia Despite Sales Ban

Shipping Containers
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Taiwan-based computer manufacturer Acer supplied at least $70.4 million worth of computer hardware to Russia, despite an international sales ban and its assertion that it would suspend its business on Russian soil. However, Reuters acquired customs data showing that Acer's wholly-owned subsidiary based in Switzerland produced and supplied equipment and services to Russia between April 8, 2022 and March 31, 2023.

It bears pointing out that there doesn't seem to be anything illegal in the way this equipment was sold: Switzerland's export restrictions mirrored that of the European Union during the April 2022 - March 2023 timeframe, so everything was legally exported out of Switzerland.

"Due to recent developments, Acer has decided to suspend its business in Russia."

Acer statement, April 8 2022

But it's not a good look, as it implies that the Swiss subsidiary (Acer Sales International SA) was moving goods and services that Taiwan-based Acer couldn't due to Taiwanese law.

Further, Acer's subsidiary contradicted Acer-Taiwan, which in an April 2022 statement, announced it suspended its business with Russia.

That does bring about several questions: was the subsidiary not disclosing its operations to its only shareholder, Acer-Taiwan? Where was it sourcing its materials from other than Acer itself? Was this used as a break in the wall to allow for some additional millions on Acer Taiwan's bottom line, while the company also reaped the public image benefits of saying it would comply with regulations forbidding exports towards Russia?

In a statement to Reuters, Acer replied, "We strictly adhere to applicable international regulations and trade laws regarding exports to Russia." It elaborated that the Swiss subsidiary "had not shipped any laptops or desktops to Russia since April 8 last year" but had supplied a "limited number of displays and accessories to the Russian market for civilian daily use while ensuring compliance with international sanctions."

Yet according to Reuters, a source familiar with the shipments said Acer's products, including monitors and laptops, continued to be shipped to Russia after April 2022. For its part, Acer-Taiwan told Reuters it was possible that importers in Russia sourced Acer devices from third countries (a widely-known practice of importing restricted products through other non-restricted countries).

Acer accounted for 18.5% of all PCs sold in Russia during the fourth quarter of 2021, according to consulting company IDC Russia, while Dell and HP made up a combined 20.8%. Considering that these US-based companies ceased exporting goods to Russia in February and April 2022, respectively, their exit left a market share void that a competitor could fill.

It's worth mentioning that the goods are essentially consumer-based ones; however, we also know that consumer-grade products can be repurposed for military-specific ones by sophisticated-enough opposers. Russia and its allies are sophisticated enough to do that and more

Russian customs data accessed by Reuters showed at least 744 shipments of Acer's products entered Russia between April 8, 2022, and March 31, 2023, less than the
3,735 registered in the previous year. According to the data, shipments fell 71.1% between the imposition of sanctions and March 31, 2023, with laptops and PC monitors making up the bulk of Acer's Swiss subsidiary's shipments.

Francisco Pires
Freelance News Writer

Francisco Pires is a freelance news writer for Tom's Hardware with a soft side for quantum computing.