Financial Times (FT) reported on the 1st (local time) that high-end European luxury goods such as Gucci and Burberry are widely distributed in Russia, where Western sanctions have continued for more than three years.
According to the newspaper, the online catalog of Tsum, a high-end department store in Moscow, showed a large update of products from luxury brands such as Gucci, Saint Laurent, and Valentino under the Kering group, and Chloé under Richemont. There are about 4,000 items from the Italian brand Dolce & Gabbana, and many products from Burberry and Brunello Cucinelli were also spotted.
Earlier, the European Union (EU), as part of sanctions on Russia for the 2022 invasion of Ukraine, banned the export of luxury goods with a wholesale price of 300 euros (about 509,300 won) or more per item. Under the relevant regulation, export-prohibited items include clothing and bags as well as ▲ truffle oil ▲ caviar ▲ champagne. According to the industry, a wholesale price of 300 euros corresponds to a retail price level of 1,000–1,200 euros.
However, as these products are effectively entering Russia through third-country rerouting via Türkiye, the United Arab Emirates (UAE), China, and others, some say the EU sanctions are functioning only as a so-called "price premium." Because logistics expense and risk expense are reflected directly in consumer prices, products are being sold in Moscow at two to three times the European average.
In fact, a comparison of retail prices for about 600 European luxury items sold at Tsum found that products averaging 1,229 euros in Italy and France were approaching an average of 2,626 euros in Russia. For example, watches sold for an average of 17,700 euros in Europe, but were priced at 33,100 euros in Moscow, nearly double.
Among them, the category with the most pronounced price gap was bags, with models averaging 1,900 euros in Europe reaching an average of 5,200 euros in Moscow.
In practice, distributors appear to source lower-priced products directly from the EU, while purchasing higher-priced products through intermediaries in third countries. In the first quarter of last year, Mercury Fashion, the operator of the Tsum department store, imported $6.7 million worth of Dolce & Gabbana products, but no items with a per-unit price exceeding 300 euros were found in the shipping documents.
In the process, a new logistics industry is also taking shape in Russia. Global Style Import, a logistics firm in Moscow, is pursuing third-country rerouted imports under the phrase "helping access the latest trend products around the world," and in the first quarter of 2025 the company brought in about $1.7 million worth of Dolce & Gabbana items via Turkey and the UAE. Product prices generally far exceed the export base price.
Industry experts said, "Rather than being cut off by sanctions, Russia's luxury market is becoming more advanced in a more expensive and complex way," adding, "The effectiveness and limits of Western sanctions are being laid bare."