Software localization: what is important for companies to know

Legal Digest News
Due to the tightening of sanctions imposed by the Council of the European Union, access of Russian companies to a number of programs and cloud resources will be terminated.

The innovations establish a ban on the sale, supply, transfer, export or other provision of software that is used in the fields of enterprise management, industrial design and production.

We are mainly talking about specialized software for architectural and engineering surveys, organizations in the field of design, production, work in the media, and the entertainment industry. However, the ban itself applies to any Russian legal entity. A specific list of software that falls under the European sanctions:

  • Enterprise Resource Planning (ERP)
  • Customer Relationship Management System (CRM)
  • Business Analytics (BI)
  • Supply Chain Management (SCM)
  • Corporate Data Warehouse (EDW)
  • Computerized Maintenance Management System (CMMS),
  • Project Management software, Product Lifecycle Management (PLM) and other components for the specified software, including software for accounting, fleet management, logistics and personnel management
  • Building Information Modeling (BIM)
  • Computer-aided design (CAD) system
  • Automated Production System (CAM)
  • Custom development (ETO) and other components for the specified software.

Meanwhile, if a European company has concluded a software provision agreement with a Russian counterparty before December 19, 2023, then it will be possible to supply and sell software to Russia until March 20, 2024.

There may also be exceptions in cases where the ban on providing software is not valid:

  • If a Russian company is owned or controlled by legal entities registered on the territory of an "unfriendly" country, then the ban on providing software does not apply until June 20, 2024.
  • If the sale, transfer, or delivery of software to Russia is conditioned by exceptional public goals (for example, responding to health emergencies), preventing natural disasters, etc.
  • If the Russian organization has received permission from the authorized bodies of the EU member States. However, at present, the form and procedure for obtaining such permits by members of the EU Council is not specified.

There is no liability for violation of such a ban, but foreign companies can be guided by the legislation of the State of the country in respect of which such a ban is violated.

For localization and migration to Russian software, please contact the IT department of Acsour. Our experts will help you adapt the technical features of your business to the new rules, as well as take active measures to localize and develop domestic software.