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Unsanctioned Western companies enabling Russia’s war effort: missing links found in missiles

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13 August 2026

Unsanctioned Western companies enabling Russia’s war effort: missing links found in missiles

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Despite international sanctions that aim at limiting Russia’s military capabilities, there is growing evidence that Russia, with the help of its closest allies (Belarus, Kazakhstan) and strategic partners (China, Iran, North Korea), still manages to externalize the supplying of its army with the ammunitions and high tech that it needs to wage its war against Ukraine.

Moscow basically needs three ingredients to fuel its war effort: the machine-tools used to produce complex parts for weapons, microchips to guide them, and petrodollars to pay the bills. Ukraine alleges that Western companies are contributing to these supply schemes as well. Whereas forensic experts have indeed found in the drones that kill Ukrainians on a daily basis Western-made microchip technologies[1], what is less known is that the missiles used to strike Ukraine every night, including the infamous Oreshnik, that can carry nuclear warheads, have been produced using machine tools equipped with Western computer numerical control (CNC) technology – in flagrant circumvention of the letter and spirit of Western sanctions.

Building on the analysis of open-source material and publicly available forensic investigations, this paper delves into this problem and identifies several loopholes in the implementation of export bans that allow a dozen American, European and Japanese companies to keep on supplying Russia with the modern CNC technology that helps improve the precision, velocity and lethality of Russian missile strikes.

Oil, the lifeblood of war

Photo: AFP/Scanpix

For years now the wider public has been aware of the existence of a shadow fleet of old tankers under flags of convenience used by Russia to clandestinely export its crude oil in circumvention of the price cap sanctions adopted in 2022 by the G7 countries and the European Union. Against the backdrop of the Iran war, which caused energy price to surge from March till June, Russia kept on cashing in substantial profits. Oil and gas tax revenues account for up to 30% of the Russian federal budget, which is mostly geared towards fueling the war effort. As the Russian economy shifted toward a war footing, with defense spending driving growth and employment, the 733 million Euros per day that Russia earned in April from its fossil fuel exports (the highest since 2023)[2] are crucial to sustain military spendings.

In its 20^th sanctions package, the EU introduced new sanctions[3] targeting specifically Russia’s oil and the identified vessels of its shadow fleet – 632 were subjected to a port access ban and a much-awaited ban on the provision of maritime transport services.[4] This should help beefing up the legal arsenal allowing national navies to board, check and eventually divert these vessels whenever they approach European coastlines. This is a drop in the ocean, but at least it can deter these vessels from approaching EU waters again. This chilling effect is all the more important given that some shadow fleet cargoes were also found to be instrumental for Russia’s recurrent hybrid attacks against Europe’s vital interests: for sabotaging under-water cables in the Baltic Sea (by dragging their anchor on the seabed) or to serve as launchpads for unmanned aerial vehicles (drones) carrying out reconnaissance flights over critical infrastructure, to map defence vulnerabilities or even plan terrorist attacks.

Less known however are the cracks in the system that allow Russia to circumvent sectoral sanctions meant to deprive its military-industrial complex of the technologies, maintenance services and spare parts that it desperately needs to produce the weapons that kill Ukrainian civilians every day: drones, and missiles notably. On that front, it seems that the EU is not delivering on its promises to incapacitate Russia’s war economy, since many Western companies, including several from EU countries themselves, are still enabling – albeit indirectly, and maybe even unwittingly – the production of key weapons Russia is using in this war, and might maybe use in future kinetic conflicts against Europeans themselves.

Patching holes with foreign parts

Throughout the war, the Ukrainian Ministry of Defense has released reports showing that tens of thousands of foreign parts, including Western-made components, are found inside Russian drones and missiles. The Kyiv Scientific Research Institute of Forensic Expertise, a criminalistic expert body of the Ministry of Justice, has been gathering evidence of these parts’ presence in the wreckage of exploded and intercepted flying objects, or of bombs that failed to detonate. Microelectronics intended for civilian use – from engines of electric toothbrushes to microchips found in children’s toys – make their way into cruise Geran drones, or even Kalibr cruise missiles. Camera lenses and lasers necessary for precision medical equipment to save lives in public hospitals have found their way into their aiming and target recognition systems.

During the Cold War the USSR was unable to develop high-tech capabilities to produce all of these complex devices on its own, so it relied on military-industrial spying instead, to steal them from more advanced countries. Nowadays Russian patriots and sovereigntists do not seem concerned with the fact that tanks or spaceships rely on Western technologies. For decades the Russian miliary procurement agencies have been purchasing microchips, or the Western-made machine-tools specifically designed to craft them, from world markets. Many are dual-use products, and even those sold only through licensed channels were available in an unhindered way – at least until 2014, if not 2022.

Following the annexation of Crimea, limited sanctions were introduced that Russia circumvented with great ease, using traditional trade partners with looser or no restrictions on selling goods to Russia – Turkey, China, India, the United Arab Emirates[5], Kazakhstan[6] (which is part of the Russia-led Eurasian Customs Union) and Georgia.[7]

After the full-scale invasion of Ukraine in 2022, however, stricter sanction packages were adopted that made procurement much less easy, or much more costly, given the introduction by the United States of secondary sanctions. As a result, even Chinese companies, which produce cheap equivalents of the opto-electronics needed for tracking and aiming devices for example, became more cautious: if it finds them selling sanctioned goods to Russia, an American bank is expected to deny them financial services, thereby affecting their legit trade with other world customers.

Western parts found in Russian drones

AP Photo

Despite restrictive measures, enforcing export controls proved rather challenging. Russia learnt to exploit loopholes in the sanctions regime on all stages of the supply chain to continue importing microchips or machine tools critical to its military industry. This has been well documented by the joint reports of the Yermak-McFaul International Working Group on Russian Sanctions and the Kyiv School of Economics (KSE) Institute, which are renowned for their detailed forensic analysis not only of debris, but also for their scrupulous trade investigations.

From the onset, the Working Group’s goal has been to help governments identify sanctions-evasion practices and the legal entities involved in the production and supply of weapons and their components, to pinpoint the loopholes in the sanctions systems. As early as August 2023, they published a joint report specifically dedicated to foreign components found in Russian military drones[8], at a times when unmanned aerial systems were just entering the battlefield. They showed that two thirds of the foreign components retrieved from the Shahed and Lancet drones used by Russia in Ukraine by that time originated from US companies.[9]

Such revelations caused a scandal, of course. By 2026 drones account for over 80% of the damage and casualties caused in the war, but Russian ones are now using mostly Iranian and Chinese technology (fiber-optic cable and lithium-ion batteries notably). Irrespective of the Kremlin propaganda emulating patriotism and sovereign development, throughout 2024 one third of Russia’s ballistic missile attacks on Ukraine were carried out using North Korean technology.[10]

Yet Ukrainian civilians keep dying from being hit by lethal bombs manufactured with the help of Western-made technologies too. Russian cruise missiles (like the Iskander or Kh-101) and Iranian-designed Shahed drones have been routinely found packed with modern US, French[11] and Dutch[12] high-end technology supplied to Russia in violation of export bans. In October 2025 Ukrainian President Volodymyr Zelenskyy claimed that over 100,000 foreign-made parts were found in the drones used in a single overnight attack, on October 5^th. They included British-manufactured microcomputers, Swiss-manufactured microcontrollers[13], and German-manufactured switching connectors.[14]

Cutting edge technologies: spotlight on CNC machinery tools

AP Photo

The Yermak-McFaul International Working Group on Russian Sanctions and the KSE Institute released another expert study in early 2024 that identified no less than 250 Western companies whose products appeared in Russian weapons on the battlefield; in the first ten months of 2023 alone, according to the report these companies supplied critical components to Russia worth almost $3 billion.[15]

The report shed light on a specific category of foreign-made products that have no equivalent in Russia: CNC (Computer Numerical Control) machinery tools. A CNC is a high-tech equipment necessary to produce high-tech weapons, even if it is not its primary use. CNC machine tools are automated machines controlled by computer programs that move cutting tools (plasma, laser or waterjet cutters, mills for cutting 3D shapes and cavities, lathes to rotate workpieces and cut cylinders, routers for high-speed cutting of composites and plastics, etc.) with high precision to produce complexly shaped parts. CNC machines typically contain a controller (computer), sensors that probe tool setting, axes and motion systems, spindles to hold the cutting tools or workpiece during rotation, and fixtures.

The more sophisticated the machine type, the better the part that will be produced will fit in a complex weapon system, the more performant the missile will be, since it will hit a target with higher precision. According to estimates, 70% of all CNC machines in Russia are imported, and as many as 80% of all machines go to the military. [16]

Stopping the flow of CNC-equipped machinery to Russia has been a priority for the Europeans, who did put these tools and components on their “common high-priority goods list” of high-tech items which they want to prevent Russian weapons-makers from acquiring. Yet the data published in the report showed that Russian imports of CNC machinery tools had risen by a third since before the war, with Germany, South Korea and Taiwan together accounting for over 82% of the equipment delivered.[17] Switzerland provided over 20% of the machine components Russia imported. The total value of components from EU manufacturers exceeded $1 billion, while subsidiaries of European brands in third countries supplied an additional $6.9 million worth of components. Other European brands identified as suppliers of equipment for Russia’s defense sector include Trumpf, DMG Mori, Chiron, Grob, Schneider Electric, and Siemens.[18]

According to CNN, nearly one-third of the ballistic missiles deployed by Russia against Ukraine in 2024 were KN-23 ballistic missiles manufactured in North Korea. A UK-based investigative group, Conflict Armament Research (CAR), analysing the debris of a KN-23 retrieved in Kharkiv in January 2024, identified 290 foreign-made electronic components in it. Among these were 50 unique models produced by 26 companies across eight countries, including the United States (75% of the components)[19], Germany, Japan, and Taiwan.[20] The Ukrainian Independent Anti-Corruption Commission (NACO) argued that nine Western companies, including also manufacturers from the Netherlands and the United Kingdom, had produced critical components for these missiles. Notably, some parts analyzed were manufactured as recently as 2023, suggesting swift delivery of these components to North Korea despite international sanctions.

Ukraine’s Economic Security Council was able to analyze customs data from the beginning of 2023 and the first seven months of 2024. The data showed that despite the tightening of sanctions and export restrictions, imports of critical CNC equipment and components to Russia continued during that period.[21] Between January 2023 and July 2024, more than 22,000 CNC machines, components, and consumables were delivered to Russia for a total of $18.2 billion. While China is Russia’s primary supplier of CNC machines and components, European countries still account for a significant portion of these critical imports, the investigation found. Switzerland supplied over 20% of the components. The total value of European components supplied to Russia from EU manufacturers exceeds $1 billion. At the same time, components manufactured by subsidiaries of European brands in third countries were supplied to Russia for more than $6.9 million.[22]

Whereas naming and shaming pushed many Western companies to implement better internal due diligence procedures and significantly reduce the amount of goods that end up in Russia, there is accumulating evidence that CNC technology is still delivered in circumvention of primary and secondary sanctions.

In August 2025, Reuters disclosed that Russian state-owned arms factory Biysk Oleum (BOZ), which produces explosives, had acquired advanced production automation equipment from Siemens, following an opaque sanctions-evasion scheme that involved a Kaliningrad-based intermediary, Techpribor, that ordered the CNC machine tool from Chinese distributors. The latter later revealed that Siemens did not ask about the final recipient of the CNC technology, although the German provider should have withheld shipment as there were reasons to suspect the Chinese intermediary was a Russian shell company likely to re-export the device to Russia.

The CNC machine scene in Russia has changed a lot recently, with Asian companies like South Korea’s Doosan and Hanwha, and Japan’s Fanuc becoming key players.[23] According to the Robert Lansing Institute, Chinese firms such as Tengzhou Wellon Machinery Co. Ltd, Tengzhou Borui CNC Machine Tool Co., Ltd, and Xiamen Yangsen NC Equipment Co., Ltd openly advertise advanced machine tools on Alibaba. “These include models such as the XL8132, BR570DY, and YSMV-2218 — high-precision milling and turning equipment that Western officials warn may soon underpin robotics and automation at Russia’s weapons plants”, RLI claimed in an August 2025 report.[24]

As a result of this revelation, the EU started putting more pressure on Chinese companies supporting the Russian aggression and expanded its list of sanctioned companies in July 2025. No EU firm was added on the EU’s sanctions’ list however, even though in late 2024 a new threshold was reached, which shocked the whole world: for the first time in the war, on 21 November 2024 Russia used a hypersonic ballistic missile against Ukraine.

Hours after the strike, Vladimir Putin, in a TV address, said that the weapon, nicknamed Oreshnik (Hazelnut), travelled at a speed of Mach 10, or 2.5-3km per second (10 times the speed of sound). Ukraine’s Main Intelligence Directorate said it took only 15 minutes to reach Dnipro, more than 1,000km (620 miles) away from the launch site Kapustin Yar in Astrakhan region. It was soon revealed that the Oreshnik missile somehow “contained” Western-made CNC technology as well.

In a nutshell: Western manufactured CNC found in the production line of Oreshnik missiles

Reuters

Ukraine’s military intelligence service pointed that the Oreshnik system, which bore the characteristics of an intercontinental ballistic missile (ICBM)[25], was not as new as Putin claimed it was, since it derived from Kedr (Cedar), a recently introduced intermediate-range ballistic missile derived from the RS-26 Rubezh (Frontier) program dating back several decades.

Russia tried to design the Oreshnik’s architecture to be sanction-proof. Because the US and European nations have heavily clamped down on the global supply chains of dual-use microchips, Russia thought to bypass the problem by utilizing an entirely analog, retrofitted Soviet guidance base, without needing to smuggle modern American or French microelectronics.[26]

A proven Western footprint in the Oreshnik program was found, not on the microchips inside the wreckage itself, but primarily through the advanced manufacturing machinery used to build it. As exposed by international trade data, the Russian defense enterprises milling the physical metal airframes and rocket motor casings rely on heavy industrial computerized numeric control (CNC) machine systems manufactured by German and Japanese firms.[27]

A few weeks after the strike, the Financial Times published the results of an investigation[28] that pinned two German companies, Siemens and Heidenhain, and a Japanese firm, Fanuc, for selling CNC controllers to Chinese intermediaries that then re-exported the devices to the Moscow Institute for Thermal Technology (MITT). Despite their good will – or maybe for a deliberate lack of due diligence? – the CNC technology was diverted to equip a Russian entity, the MITT, under sanctions due to its involvement in the production of missiles for the Russian military.

The supply chain has been identified within a couple of weeks after the strike.[29] «We have successfully traced some of those components, and the last known custodians are Chinese companies,» said Damien Spleeters, deputy director of operations at Conflict Armament Research (CAR). Despite strict export controls, trade data showed that until 2024 at least $3 million worth of Heidenhain components successfully bypassed sanctions to enter Russia through third-party supply chains. German Heidenhain equipment was also found to be in use of a Russian company, Stan, leading attempts to build a domestic CNC production industry in Russia.

These companies are considered victims of illicit sanctions evasion rather than outright perpetrators. Siemens claims it was among the first German heavyweights that exited the Russian market and stopped supplying Russian companies after the 2022 invasion.[30] The company, wary of the negative impact on its reputation, integrated robust, highly automated export tracking systems and proactively flags any suspected shell-company circumvention directly to international regulatory authorities.[31] Heidenhain launched internal crackdowns on its downstream global distributors. For instance, they removed certain Taiwanese machine-tool companies from their whitelists and forced foreign buyers to undergo strict, individual review processes for every purchase to ensure components aren’t diverted to Russia. Fanuc formally halted all direct sales and technical servicing to Russian clients as well; hence Western regulators have not leveled punitive corporate or criminal sanctions against any of the parent brands.

Sanctions-enforcement: can’t we prevent Western CNC deliveries to Russia?

iStock by Getty Images

At the end of February 2024, the Group of 7 (G7) and the Global Export Controls Coalition (GECC) added a new subcategory of goods to the existing 45 HS Codes which make up the common high-priority goods list.[32] This new category, Tier 4.B, identifies 5 HS Codes specified as “Computer Numerically Controlled (CNC) machine tools and components.” The product sets covered in Tier 4.B range from horizontal lathes, grinders, milling machines, and their individual parts and components.[33]

Yet it appears that, 1500 days after the start of the full-scale invasion, all the export controls policy gaps have not been closed, and corporate responsibility still needs to be bolstered. This came to the fore in 2026, since Oreshnik missiles again were fired again that stroke Lviv on 8 January and Bila Tserkva near Kyiv on 24 May.

These were obvious attempts to escalate tensions – after all, Oreshnik missiles are less damaging than Kinzhal missiles, or Iskander, but they can carry nuclear payloads. Given Putin’s recurrent use of nuclear blackmail, the inconsiderate use of an expensive yet imprecise missile of this type is only to spread fear, in Ukraine and abroad. Hence why A. Lukashenka regularly mentions the alleged deployment of Oreshnik to Belarus as well[34]. Yet if such a missile was launched from Belarusian territory to strike Ukraine, or a NATO country, Belarus would immediately become eligible to legitimate reprisal strikes.

Some of the companies that deliver CNC technology to Russia have come under sanctions, for example, Haas Automation has been fined $2.5 million for 21 violations of sanctions related to the defense and energy sectors of Russia. President Volodymyr Zelensky in June 2025 said sanctions were urgently needed on more Russian defense companies to stall the mass-production of the Oreshnik. His warning doesn’t seem to have been heard, and in May 2026 an Oreshnik hit Kyiv, killing four people.[35]

Attention has thus shifted to the Votkinsk Machine Building plant (Votkinskiy Zavod JSC), where Oreshnik missiles are produced. Based near Izhevsk in Udmurtia, the plant serially produces RS-24 Yars intercontinental ballistic missiles (ICBMs) and RSM-56 Bulava missiles for Borei-A submarines. Solid-fuel ballistic missiles for the Iskander-M system (9M723-1), for the Kinzhal air-launched missile system (9-S-7760), Topol-M intercontinental ballistic missiles, and Oreshnik IRBM (CW1000, IS-800PMF4, IR-500PMF4) are also manufactured in Votkinsk. According to War and Sanctions, a website administered by the GUR (Ukraine’s military intelligence agency), several Western companies have provided the Votkinsk plant with key CNC machine-tools[36], including after the start of Russia’s aggression of Ukraine in 2014. Even though most deliveries predate the actual enlistment of the plant on the EU’s sanctions list on 16 December 2022, it is an open secret that these complex machine tools cannot operate without regular maintenance – a know-how that is still lacking in Russia proper. In recent years, the plant quietly imported advanced equipment, mostly via China, in view of sustaining its independent production and maintenance capacity.[37] Meanwhile, metallurgical plants linked with Rostec defence giant have apparently managed to obtain sanctioned equipment from Italy and other EU countries, using a Turkish firm, Redwing Metal, as intermediary.[38]

Based on forensic analysis of Oreshnik debris, Ukraine’s military intelligence has evidenced that CNC equipment manufactured in countries expected to enforce an export ban against Russia had been used to produce missiles launched against Ukraine. This includes in the case of the Votkinsk plant manufacturers from the US (Micro-Vu), the Czech Republic (Tos Varnsdorf, Smeral)[39], Germany (WMW Heckert, Walter Maschinenbau), Italy (Valdarno S.r.l., Vibrochimica, Danieli & S.p.A.), Sweden (Hexagon AB) and Japan (Yamazaki Mazak). Surprisingly, none of them appear on OFAC or any EU listing yet.

The Votkinsk plant was damaged on 20 February 2026 following a strike by Flamingo FP-5 cruise missiles, illustrating how Ukraine is effectively using so-called “long-range” sanctions to limit Russia’s missile production capabilities. Yet enforcing bans on the (re)export of CNC technology to Russia is crucial to prevent sanctions-evasion and to hold circumventers to account in a way that can effectively deter Western manufacturers from providing or servicing the machine-tools that enable Russia’s war and terror capacity.