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Russian entrepreneurs in Finland – how do the Russia sanctions related to public procurement affect them?

Procuring entities need information on their suppliers’ links to Russia in order to assess whether a contract can be concluded with a company, taking into account the EU sanctions against Russia relating to public procurement.  

You can read more about this topic here.

 

What is a procuring entity? 

A procuring entity is an organisation to which the Public Procurement Act (1397/2016) applies. 

Examples of procuring entities include: 

  • the state and state agencies, 
  • municipalities and municipal federations, 
  • welfare regions, 
  • the Evangelical Lutheran and Orthodox churches and their parishes, 
  • state-owned enterprises, and 
  • other publicly funded bodies to which the Public Procurement Act applies. 

These entities are obliged to put their procurements out to tender in accordance with the Public Procurement Act. 

 

I am a Russian entrepreneur (residence permit or dual citizenship) – how do the Russian sanctions on public procurement affect me?

If you are a Russian citizen and exercise control over your company, procuring entities cannot enter into contracts with your company due to the sanctions currently in force.  

However, you may continue your business activities with operators/customers other than procuring entities. 

 

One of my subcontractors is a company owned by a Russian entrepreneur – can I continue to work with this company? 

If your customers are not procuring entities, the Russia sanctions on public procurement do not affect your cooperation. 

If your clients are procuring entities and you use a subcontractor for deliveries to them, you should note that the Russia sanctions on public procurement may, in certain situations, also apply to your major subcontractors.  

This is the case when the subcontractor’s share exceeds 10 per cent of the value of the contract you have concluded with the procuring entity, or when your company relies on the subcontractor’s resources, as defined by procurement regulations, to meet the procurement requirements.  

If your subcontractor has a significant share of the supply as described and is subject to the Russia sanctions in public procurement, contracting entities cannot enter into a contract for the works with your company.