Filling the cracks in the wall around Russia: Who is the company from Serbia that was on the new list of US sanctions

As stated in the announcement of the US Ministry of Finance, which accompanied the publication of the new list of sanctioned persons, the company Ventrade d.o.o. is associated with the company Promsvyazradio from Russia. The connection consisted in the fact that they exported military-grade radio components to them, and the Russian company used them in the production of radio broadcasting equipment. Formally speaking, the company Ventrade has been marked for sanctions based on the executive order of the US government for "providing financial, material and technological support to a Russian company, or sending it goods and services."

The US Department of Finance also connects the company of Bence Horvat, a businessman originally from Hungary, who was arrested in San Francisco in August on suspicion of illegally exporting US radio communication systems to Russia, as stated by the US Department of Justice, with the Russian company Promsvyazradio.

As the US Department of Justice adds, Horvat is accused of organizing the purchase of American radio communication systems and their smuggling for the benefit of the Russian government through a network of related companies in Spain, Serbia, Hungary, Latvia and elsewhere.

 

That the company Ventrade d.o.o. may have been purposely established for export to Russia during the war in Ukraine is suggested by the information of the Agency for Economic Registers that the company started working in April 2022, immediately after the start of the war in Ukraine. The founding capital was 120,000 dinars, and it was founded by Renata Meznerics, a Hungarian citizen. She was replaced as founder and director in July 2023 by Zolt Lajgut, also a Hungarian citizen.

Further operations of this company were investigated by Radio Free Europe, finding that Ventrade sold goods worth 529,000 euros to Promsvyazradio from September 2022 to June of the following year. This is a very similar amount that is stated in the financial report of that company as income for 2022, and he says that the company had an income of 56.3 million dinars, i.e. slightly more than 481,000 euros. According to RSE, based on the data of the Sinomix commercial database on international trade, the goods in question were re-exported via several countries, mostly via Germany and Malaysia. The account of the company from Subotica has been blocked since September 29, 2023, according to data from the National Bank of Serbia.

 

Western components on the eastern front

Military analyst Aleksandar Radić states for NIN that the news that a company from Serbia was on the list of the US Ministry is exaggerated, precisely because of the specific position of Serbia vis-à-vis the war in Ukraine.

"The US Department is trying to identify all ways to re-export funds useful for Russian military production and other strategically important needs of the Russian side. For this purpose, apparently, dedicated software is used that connects data from customs, export and import, which creates a network of companies that do business with Russian companies. So, this is not about some kind of super-secret operations, but about software analysis. The irony is that when some rockets do not land on the ground, it turns out that most of the components were produced in America, EU countries or Japan. This suggests that the number of Western companies involved in re-export is much higher, but when a small company is found in Serbia, it attracts more media attention, precisely because of the special ties between Serbia and Russia," says Radić.

By being placed under American sanctions, the company Ventrade d.o.o. was on the list of Serbian companies that were previously sanctioned due to accusations of

exporting dual-use goods to Russia during the war. In addition to those, the list of American sanctions includes, but for different reasons, other personalities and companies from Serbia, such as the Deputy Prime Minister of Serbia Aleksandar Vulin or Minister Nenad Popović, and companies associated with Milan Radoičić and Zvonko Veselinović, several companies that are linked with Slobodan Tešić...

As NIN previously wrote, the company "Cominvex" is also on the list, which in 2021, before the start of the war in Ukraine, had a business income of 16 million dinars (136,000 euros), while in 2022, when the Russian invasion of Ukraine was at its height, according to the published financial report, it had an income of 15 billion dinars (128 million euros), almost 1,000 times more than a year earlier.

The company Conex was also included in the list of sanctioned companies, as well as three other companies from Serbia, Soha info, Goodforwarding and Research and Development Company TR Industries, which, like Ventura, were founded in 2022, when the war had already started.

Since the beginning of the war in Ukraine, in addition to the front, the fight was also waged in the economic sphere, where the USA and the EU first of all tried to influence the Russian economy with sanctions, and therefore their effectiveness in war operations. The EU alone has so far introduced 14 sanctions packages, expanding the circle of individuals and companies covered. Until now, Serbia has refused to join the sanctions against Russia, and the latest report of the European Commission on Serbia insists that our country harmonize its foreign and security policy with the EU, but it is also emphasized that it has continued cooperation with the EU in connection with the prevention of circumvention of sanctions. In the report, the EC recommends Serbia to continue and raise the level of action to prevent any attempt to use the territory of Serbia or legal entities registered in Serbia to circumvent EU restrictive measures. The EC's report on Serbia also deals with the issue of dual-use goods, so it is stated that Serbia "has yet to fully comply with the latest EU acquis in that area".

"Serbia regularly adopts the national list of dual-use goods in order to comply with the latest regulations adopted by the EC", the report states and adds that Serbia's application for membership in the Wassena Agreement on the export of arms and dual-use goods, and the Australian group (for the control of potential export of chemical and biological weapons), has yet to be considered.

Sanctions without the desired effect

Aleksandar Radić points out that so far the sanctions have not proven to be very effective, and that the Russians still manage to acquire sophisticated components of Western production.

"Russian military production is progressing despite the sanctions. They are pushed by sanctions to cooperate in the military sphere with countries such as Iran and North Korea. However, they acquire even the most sophisticated means they need for production from the West. It can even be said that in that area the Russians are very dependent on other countries, because they did not implement the Russification of the production of key combat systems. Paradoxically, before the war, Russia implemented a good part of those cooperation agreements with Ukraine and the Baltic countries. For example, in 2019, Lithuanian mechanics inspected engines on intercontinental missiles in silos, i.e. on key weapons. The other side of the coin is that they use a lot of resources that are technologically unchallenging, and they get them from North Korea and Iran," Radić points out.

And although, according to the highest state officials, Serbia is continuously under pressure to impose sanctions on Russia, there were also pressures in the past to prevent the circumvention of EU sanctions. In December 2022, the President of Serbia, Aleksandar Vučić, after a meeting with the EU Enlargement Commissioner at the time, Oliver Varhelji, pointed out that "through the territory of Serbia, no one can circumvent the sanctions imposed by the EU on Russia", and that Serbia reacts to these attempts and sanctions them. Ana Brnabić from the position of Prime Minister in May 2023 declared that "Serbia is not and will not be a platform for circumventing the sanctions imposed by the EU against Russia".