PARIS, June 15 (Reuters) - Nike ( NKE ) stopped selling its

sportswear to Russia soon after Moscow launched its full-scale

invasion of Ukraine over two years ago. But that hasn't stopped

footballstore.ru, an online sports retailer owned by Russia's

Zenit soccer club.

Among the dozens of Nike ( NKE )-branded items the site offers are

the U.S. sportswear maker's Phantom GT2 Elite soccer boots, for

29,999 roubles, or around $330.

The man who got these shoes to Russia is Wijnand Herinckx, a

40-year-old Dutch citizen who lives in Moscow. Since the

conflict began, Herinckx has built a thriving business that

provides Russian consumers with Western goods whose makers have

pulled out of Russia.

"Nike ( NKE ) does not want their products to be shipped to Russia,"

Herinckx told Reuters in a video call from his office on the

outskirts of Moscow, where shelves are stacked with boxes of

Western branded footwear. But he added: "They are also not

telling us not to do it."

Both Nike ( NKE ) and Lego told Reuters they have not

authorized Herinckx's imports of their goods to Russia.

By examining customs data, corporate records and internal

company documents, and by speaking to Herinckx himself, Reuters

learned how his business obtains branded goods including Nike ( NKE )

and Lego: It uses intermediaries with no apparent connection to

Russia as buyers, then ships the goods to Russia - often via

Turkey - and finally delivers them to retailers in Russia.

There are at least dozens of firms like Herinckx's employing

grey-market methods to get Western goods to Russia, according to

a Reuters analysis of customs data. His operation shows how

attempts by Western governments and brands to isolate Russia's

economy are crashing into a reality of global business: Where

there's demand, someone will meet it.

Western governments' restrictions have mostly focused on

industrial products that can be used to build weapons for

Russia's war machine. Such products are usually subject to U.S.

and European Union sanctions. Herinckx said his focus is on

consumer goods not covered by sanctions. Reuters found no

evidence that his firm was violating sanctions.

But companies like Herinckx's are indirectly helping the

Russian economy: Consumers can still buy foreign goods they've

grown used to since the collapse of communism more than a

generation ago. Customs data analyzed by Reuters showed, for

example, the value of Nike ( NKE ) products imported to Russia plummeted

81% in 2022 to $21 million, but rebounded in 2023 to at least

$74 million.

The sportswear giant said it did not supply Herinckx's firm

or any associated businesses. "We no longer have any Nike ( NKE )-owned

physical or digital retail operations in Russia," it said in a

statement. "We do not ship any product to Russia, nor do we

authorize any marketplace partners to distribute product there."

It also said it has a dedicated team to investigate unauthorized

distribution channels. A spokesperson didn't respond to

questions about how the products were reaching Russia.

In mid 2022, following Moscow's invasion of Ukraine, Nike ( NKE )

announced it was exiting Russia and Lego said it was closing its

Russian business.

As global brands halted sales or stopped exports over the

invasion, Russia authorised businesses to import products from

abroad without the trademark owner's permission. Russia said its

so-called parallel imports totalled more than $70 billion in the

two years up to the end of 2023.

Some legal specialists say seeking recourse under Russian

law would be challenging for Western brands, leaving few other

legal options for brands trying to enforce intellectual property

rights that are typically tied to the territory where the

infringement took place.

The availability of Western brands lets Russian President

Vladimir Putin "project a message that the war does not

undermine the 'normal life' of the Russian middle class, " said

Sergei Guriev, a Russian economist who is provost at Paris'

Sciences Po university.

'PROUD OF IT'

Herinckx's Russian company employs 82 staff and forecasts

revenues in 2024 of 35 million euros, or about $37 million, he

said. Last year, it was $23.7 million, according to company

accounts.

At the time of Russia's 2022 invasion of Ukraine, Herinckx

was working in the Moscow office of a German company, Hellmann

Worldwide Logistics. According to Herinckx, he ran a team of

more than 20 people inside Hellmann that served foreign

companies who wanted to sell in Russia without setting up local

operations.

Hellmann quickly decided to pull out of Russia. Herinckx

stayed put. He had previously married a Russian woman with whom

he'd had children, Herinckx said. "Our life is here. Everything

we have we built up here," he said.

He took over one of Hellmann's Russian entities, renamed it

Herinckx Trade Solutions Rus (HTS Rus), and registered it in his

wife's name in April 2022. Herinckx initially used Hellmann's

email servers, and a variation of the Hellmann logo in his

marketing.

Both Herinckx and Hellmann said they had a transitional

agreement to let the Dutchman use some of his old employer's

infrastructure. Hellmann said the deal to use its logo expired

in October 2022, and that its intellectual property was used

without its consent after that. Herinckx said this was an

oversight and he stopped using Hellmann logos in January 2024.

Hellmann said it now has no connection to Herinckx's business

and has no operational business in Russia.

Among goods Herinckx's firm ships to Russia are Reebok

sports shoes and Emporio Armani wristwatches, according to

Herinckx and data recorded by a Russian bank that lists assets

HTS Rus pledged against a loan.

Herinckx said he did not have authorisation from those two

brands. Armani Group said it had stopped authorised shipments to

Russian distributors and does not know how HTS Rus had got hold

of the products. Reebok's owner Authentic Brands Group, which

said in 2022 it had suspended all branded stores and e-commerce

operations in Russia, didn't respond to a request for comment.

The Dutchman's firm doesn't publicly disclose its customers.

But Reuters identified some of its Russian clients by reviewing

documents the company filed with Russian tax authorities.

Customers included some of Russia's biggest supermarket chains

and online retailers.

Herinckx said his firm is a good corporate citizen that is

also involved in charity work. Asked why he decided to speak

publicly about his operations, he said: "What we do is quite

cool, we are proud of it."

EUROPEAN ROUTE

Among his achievements is importing Lego bricks. The Danish

firm said it strictly enforces its policy of not selling to

Russia. When it sells to retailers or distributors, it writes

into the contract that they must not re-sell to Russia,

according to Herinckx and Lego.

To get around this, Herinckx said he inserted a chain of

intermediaries between Lego and Russia. Some of the Lego bricks

he buys are first bought from the manufacturer by a company in

Europe that has no relation to his business, he said, declining

to name the company. He then buys the bricks from that company,

using a Netherlands-registered entity he owns called HTS Europe

B.V., he said.

The goods are then trucked directly from Europe to Russia,

passing through customs checks on the way, according to

Herinckx.

Once in Russia, the Lego comes under the control of

Herinckx's Russian business, HTS Rus, according to the loan data

and tax documents. Herinckx told Reuters he supplied Lego to

around 48 Russian firms, mostly specialist toy retailers.

"My children play with Lego," Herinckx said. "I have nothing

against other children playing with Lego."

Lego has problems with his operation, though.

After Reuters contacted Lego for comment in late April, the

Danish firm said it had written to HTS Rus accusing it of

falsely claiming on its website that it collaborated with Lego.

HTS Rus subsequently changed the English-language version of its

website, removing an image of Lego figures and replacing it with

generic children's plastic toys. The Russian-language version of

the site still carried a Lego logo as of June 13.

"We are concerned to learn of this flow of goods considering

we stopped shipping LEGO products into Russia in March 2022,"

Lego said in a statement to Reuters. "This is an issue we take

seriously and are acting upon, while ensuring that we comply

with local laws and regulations where we continue to operate."

TRANSPORTED THROUGH TURKEY

Some Western goods come via Turkey, a favoured hub for

grey-market imports to Russia. Herinckx said he sources Nike ( NKE ) and

some Lego products in Turkey, via a company called HTS Poer Dis

Ticaret Limited Sirketi, which he said procures goods from

Turkish retailers or distributors. He declined to name them.

HTS Poer co-founder Murat Erbelger told Reuters the Turkish

company had nothing to do with sanctioned products. "We do

legitimate business," he said. Erbelger did not answer questions

on HTS Poer's association with Herinckx Trade Solutions. Asked

by Reuters about grey-market goods reaching Russia via Turkey,

the Turkish presidency's communications directorate did not

respond.

Customs data for the period from June 2022 to December 2023

showed HTS Poer supplied at least $4 million worth of Nike ( NKE )

products to Russia. Herinckx told Reuters that as far as he knew

all those shipments of Nike ( NKE ) goods were destined for his company.

Once the Nike ( NKE ) products reach Russia, they go to Herinckx's

retail clients. Among them is footballstore.ru, according to tax

records and the internal HTS Rus document. Russian corporate

records show the retail site is 100% owned by Zenit soccer club.

Zenit club is sponsored by Gazprom, Russia's state-owned gas

company, and is also part-owned by Gazprombank. The lender is

subject to U.S. sanctions on the Russian banking sector.

Gazprombank, Gazprom and Zenit didn't respond to requests for

comment.

Reuters purchased the Phantom GT2 Elite Nike soccer boots

from the online retailer. They were delivered 10 days later.

Nike ( NKE ) did not comment on the shoes.

The shoe box gave the date of manufacture as September 2022,

three months after Nike ( NKE ) said it stopped selling in Russia. It

also bore a label that identified Herinckx's HTS Rus as the

importer.