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Russia off limits to UK professional services providers
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Government bans UK accountants from working in Russia

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Latest sanctions arrive two months after big accountants voluntarily announced plans to leave Russia.

4th May 2022
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Russian businesses have been banned from using UK-based accountancy firms, as part of a raft of new sanctions announced by the Government today.

The announcement comes two months after all of the Big Four and several other leading accountancy firms announced their intention to exit operations in Russia.

The ban also includes management consulting and public relations services, which collectively account for 10% of Russian imports in these sectors.

The government said the measures will increase economic pressure on Putin as Russia is “heavily reliant” on Western services companies for the production and export of manufactured goods.

Foreign secretary Liz Truss said that doing business with Putin’s regime is “morally bankrupt”.

She added: “Cutting Russia’s access to British services will put more pressure on the Kremlin and ultimately help ensure Putin fails in Ukraine.”

Ratcheting up pressure

Business secretary Kwasi Kwarteng added: “Our professional services exports are extraordinarily valuable to many countries, which is exactly why we’re locking Russia out. By restricting Russia’s access to our world-class management consultants, accountants and PR firms, we’re ratcheting up economic pressure on the Kremlin to change course.”

ICAEW managing director for reputation and intelligence, Iain Wright, responded: “Many of our individual members and member firms have already taken proactive steps to disengage as appropriate with Russia. ICAEW is confident that chartered accountants, whether in practice or in business, will be ready and willing to play the fullest possible role in making these further measures effective.”

Tamzen Isacsson, chief executive of the Management Consultancies Association, took a similar stance on behalf of her members: “UK consultancy firms already ceased services to Russia at the outset of hostilities in Ukraine and have made rapid changes to their operations in the country, strictly abiding to sanction rules and complying with all new regulations and laws. 

“The amount of services exported previously to the country was very small and it was not a major foreign market for UK management consultancy services. Firms have been assisting multinational global clients with making rapid changes to their operations in light of the new rules over the last month and giving them essential advice on how to cease operations in the country.”

Other sanctions announced today alongside the professional services ban target individuals, media organisations and online troll factories accused of furthering the Kremlin’s disinformation campaign.

 

Replies (7)

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By Hometing
04th May 2022 15:52

If the government have banned it, it's safe to say Boris will now be preparing Russian accounts

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John Stokdyk, AccountingWEB head of insight
By John Stokdyk
04th May 2022 16:09

While the professional spokespeople were too polite to mention it, the sanctions appear to have landed in a space that was vacated two months ago.

Could it be any coincidence that these gestures are being made on the eve of a big election day?

I don't really want to get too political in the circumstances, but this government has found a way to take its crass media posturing to new depths.

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Replying to John Stokdyk:
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By Hugo Fair
04th May 2022 17:25

Your cynical conclusion (yes I know that's rich coming from me) is probably correct ... but not using the logic of building-blocks on which you've presumed.

"the sanctions appear to have landed in a space that was vacated two months ago" is not really accurate:
* https://www.accountingweb.co.uk/practice/general-practice/big-four-conde... - was almost exactly two months ago, with the headline "Big Four condemns Putin but stays put in Russia".
* What followed (relatively slowly) were a number of 'withdrawals' from the practices operating geographically in Russia (varying from a few office closures to predominantly lesser actions like terminating joint branding etc).

What is now reported (on this page) may or may not translate into real & effective action ... but is quite different in that the sanctions announced are a restriction on the UK-based supply of a range of services (including accountancy) to Russian businesses.

In other words, the previous actions were decisions (company-by-company) to close down some/all of their operations in Russia ... whereas the sanctions are to be imposed (by government) on the export of specific services to Russia. Not the same thing at all - albeit complementary.

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By moneymanager
05th May 2022 15:57

Would Liz Truss say that it was "morally bankrupt" when EcoHealth Alliance, headed by Peter Daszack and was the channel for US NIH funds to gain of function virus research in Whuan wa also the channel fro US DoD finance to some twenty three bio weapons labs in... Ukraine, as testified to Senate (Rubio) by Victoria Nuland?

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Replying to moneymanager:
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By Richard Grant
05th May 2022 16:29

To be fair to Liz Truss, she only reads a script, she certainly won't have a clue what any of it means.

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Replying to moneymanager:
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By Richard Grant
05th May 2022 16:29

To be fair to Liz Truss, she only reads a script, she certainly won't have a clue what any of it means.

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By moneymanager
06th May 2022 17:58

"Russian businesses have been banned from using UK-based accountancy firms, as part of a raft of new sanctions announced by the Government today."

There has been an unfortunate drift in British journalism toward such confusing phraseology as the above example, already commonplace in the American English media.

"UK-based accountancy firms HAVE BEEN BANNED from working for Russian businesses as part of a raft of new sanctions announced by the Government today."

It is unclear as to under what legislation such bans are issued, the United Kingdom is not a belligerent, there is no declared state of war between us and as of the 3rd May there was no such declared state between Ukriane and Russia either, there has been no Parliamentary debate on the matter and, as with Matt Hancock's "back of a fag packet" decisions we are just expected to accept, unchallenged, Ministerial dictat or decree, this is profoundly unsatisfactory.

After WWI, Winston Churchill said that " if Germany is to re mercantile within fifty years, the war will have been a failure", which of course, it did.

After WWII, Winston Churchill said that " we could have stopped this war without a shot if we had wanted to, we didn't want to", I'm a little uncertain as to who Churchill meant by "we" but I doubt it included "the Man on the Clapham omnibus".

Boris Johnson cites Churchill as his role model, we have been warned and should take note.

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