Should European Companies Work with Russia in 2026?

From time to time I still receive enquiries from European manufacturers asking whether it makes sense to work with Russia.

My answer is usually the same:

Maybe.

Russia is neither a market that should be ignored completely nor a market where companies should rush without preparation.

In fact, most mistakes happen before the first conversation with a distributor takes place.

The first thing many companies look at is sales potential. In my opinion, this is the wrong starting point.

The first question is whether the product can be supplied at all.

Start with the HS code

If a company is considering Russia, the first task is to identify the correct HS code of the product.

This sounds obvious, but in practice it is often overlooked.

I have seen manufacturers spend weeks discussing distributors, pricing and logistics only to discover later that their product category requires much deeper compliance review.

Checking the HS code does not automatically answer every question, but it is usually the starting point for understanding what restrictions may apply and what additional checks may be necessary.

It is also worth remembering that two products that look almost identical from a commercial perspective may fall under different classifications.

For this reason, I would always recommend starting with compliance before discussing market entry strategy.

A product can be allowed and still fail

The second question is whether the product actually fits the market.

This is often more important than sanctions.

Over the years I have seen products that could legally be supplied but never generated meaningful sales.

The reasons were usually quite simple.

Sometimes the pricing was not competitive.

Sometimes distributors were not interested because margins were too low.

In other cases, certification requirements, documentation or product adaptations made the project much more expensive than originally expected.

A manufacturer may have a successful business in Germany, Italy or France and still face challenges in Russia.

Different markets often require different approaches.

Before investing time and resources, it makes sense to understand who would buy the product, who would distribute it and what would be required to make it commercially viable.

Think beyond today's regulations

Another point that deserves attention is future risk.

Many discussions focus on what is allowed today.

The bigger question is what may happen tomorrow.

Even when a transaction appears acceptable under current regulations, companies should think about future sanctions packages, banking restrictions, insurance issues and reputational considerations.

This does not necessarily mean that projects should be avoided.

It simply means that risk management should be part of the discussion from the beginning.

Some manufacturers prefer to separate Russian operations from their core business.

Others work through independent trading companies that purchase products and handle logistics under their own commercial responsibility.

There is no universal structure that fits every situation.

The important part is understanding the risks before the project starts rather than after the first shipment has left the warehouse.

Do the homework first

One observation from many international projects is that companies often underestimate preparation.

This is not unique to Russia.

The same mistakes can be seen in the Middle East, Africa, Latin America and many other markets.

Management becomes interested in a new market, somebody finds a potential distributor and everyone wants to move quickly.

Unfortunately, international business rarely works that way.

Before making a decision, I would normally look at four things:

• Product classification and compliance.
• Market demand.
• Distribution opportunities.
• Long-term legal and commercial risks.

Only after these questions have been answered does it make sense to discuss sales forecasts and growth opportunities.

Final thoughts

Can European companies still work with Russia in 2026?

In some industries, yes.

But I would not start with distributor search, exhibitions or sales meetings.

I would start with understanding the product, the regulations and the risks.

In many cases the decision becomes much clearer after that exercise.

Sometimes the conclusion is that the opportunity is worth pursuing.

Sometimes the conclusion is exactly the opposite.

Both outcomes are better than discovering the answer after significant time and money have already been invested.

Regards,

Yury