Security forces in Ukraine check vehicles © Aytac Unal/Anadolu Agency via Getty Images
Security forces in Ukraine check vehicles © Aytac Unal/Anadolu Agency via Getty Images

Public procurement contracts to be checked for Russian links

28 February 2022

US states have ordered reviews of public procurement contracts in the wake of Russia’s invasion of Ukraine.

The states of Virginia and Utah want to know if state procurement contracts for goods and services involve Russian companies.

Governor of Virginia Glenn Youngkin ordered “the Department of General Services to immediately review all contracts across government and procurement to determine what, if any, Virginia tax dollars are spent on goods and services from primarily Russian companies”.

Youngkin said: “The invasion of Ukraine by Soviet dictator Vladimir Putin cannot stand, and the people of the Commonwealth are ready to rally in opposition to this senseless attack on a sovereign nation and western ideals.

“Today, we are acting to show our solidarity with the Ukrainian people as they defend their country. And while these are important steps, it is incumbent upon president Biden to take a stronger, more decisive leadership position to end this war.”

He also called for an end to all sister city partnerships with Russian cities, and called on the Virginia Retirement System Board of Trustees and university endowment funds to divest all holdings of the Russian rouble and any and all securities of Russian companies.

Utah state governor Spencer J. Cox said: “Russia’s ruthless attack on a sovereign nation is an egregious violation of human rights. Utah stands in solidarity with Ukraine and will not support Russian enterprises, no matter how small the exchange.”

More than 450 firms in the US have tier one suppliers in Ukraine, and over 2,100 have at least one direct supplier in Russia, according to research by Interos. 

The research also found more than 15,000 firms in the US have tier two suppliers based in Ukraine, with more than 65,000 having connections to Russian suppliers at tier two. More than 190,000 firms in the US have Russian or Ukrainian suppliers at tier three.

The US has announced it is imposing financial sanctions on Russia’s largest shipping firm Sovcomflot. The Office of Foreign Assets Control said it had expanded Russia-related debt and equity restrictions to the company “in a move to limit Russia’s ability to finance its invasion against Ukraine or other priorities of president Putin”.

The move is part of a string of supply chain and logistics measures taken by governments globally to restrict the Russian economy. 

The UK government said it is working “rapidly” to explore possible options to prevent Russian container ships from berthing at British ports, after Scottish politicians raised concerns over a Russian oil tanker ship that is due to arrive in Orkney this week.

A government spokesperson said: “We are aware of concerns about Russian-connected ships potentially docking in the UK and we are working rapidly to explore a range of measures to restrict access for them.

“We are already discussing this issue with the Scottish Government and the sanctions being considered are part of a wider package being worked up across the UK government.”

Angus Robertson, the Scottish Government’s external affairs secretary, told BBC Scotland’s Sunday Show: “The UK authorities have got a big decision to take, on whether we are going to allow Russian-owned or chartered vessels to dock in UK ports.

“This is a very fast-moving situation and we’re going to have to act decisively in my view.”

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