U.S. Treasury Sanctions Kremlin Microelectronics Supplier

Published: 17 November 2022

Big RocketThe U.S. has sanctioned Milandr, a Russian microelectronics company, that facilitates the Kremlin’s military research and development sector in its war against Ukraine. (Photo: ru:Участник:Goodvint, Wikimedia, License)

By Henry Pope

The United States sanctioned Monday a Russian microelectronics company that has facilitated the Kremlin’s military research and development (R&D) sector as Moscow  continues its illegal war against Ukraine.

Included in the U.S. Department of the Treasury’s latest wave of sanctions is Milandr, a Russian microelectronics company that is linked to the country’s military-industrial complex. As Russia continues to wage war against Ukraine, the U.S. has decided to take action against the Kremlin’s defense industry which, according to a joint alert, is reliant on microelectronics.

The report, put together by the U.S. State, Commerce, and Treasury departments, highlighted the need to identify any and all entities that comprise Russia’s military sector and provide it with military related materials. These include weapons manufacturers, aerospace firms, and microelectronic developers, to name a few.

“Consistent with international commitments to sever Russia’s access to key components for its military-industrial complex, the United States will continue to target Russia’s efforts to resupply its weapons and sustain its war of aggression against Ukraine,” the Treasury said.

Milandr, which develops and manufactures microcircuits and other microelectronics, is an integral part of Russia’s R&D structure and has integrated its products in several of the Russian military’s weapon expositions, according to Antony J. Blinken, U.S. Secretary of State.

Also targeted in the sanctions were members of Milandr’s illicit global microelectronics procurement network, which is to say Milandr’s supply chains and, by extension, the enablers behind Russia’s military-industrial complex as a whole.

The ultimate goal behind this move is to deny Russia the equipment and technology it needs to sustain its war against Ukraine, according to Secretary of the Treasury Janet L. Yellen.

One such member is Milur Electronics LLC, Milandr’s Armenia-based affiliate. The company serves Milandr in a variety of ways by placing orders from foreign factories, producing microchips, and conducting overseas sales.

Milur Electronics is essentially a front company for Milandr, the Treasury said, and is used to conduct business with foreign partners on its Russian partner’s behalf.

Also designated as part of the supply chain network was Milur SA, the Swiss-based primary shareholder of Milur Electronics, and used by Milandr “to coordinate financial transfers to Milur Electronics.”

Capping off the list was Sharp Edge Engineering Inc. (Sharp Edge), a Taiwanese company that purchases microelectronic components from companies across the Asian continent.

Like Milur SA, Sharp Edge was designated by the Treasury as a Milandr front company, who have used their Taiwan-based partner to procure equipment necessary to produce military-grade microprocessors and other electronics.

“We will continue to use our sanctions,” Yellen said, “to weaken Russia’s military on the battlefield and cut into the revenue Putin is using to fund his brutal invasion.”

This includes, Yellen noted, any and all pillars of Putin’s war effort as well as “the crony elites who bankroll his regime.”