Russia's Killer Drones Still Boast Swiss Components. How Come?

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In a photo posted on Facebook on August 16 Andriy Starukh, a Ukrainian soldier,External link appears lying on a hospital bed, his arms linked to numerous IV drips.

Bandages on his back cover the parts of his body where he was hit by shrapnel. He smiles and raises three fingers at the camera. They represent the three metres by which a Russian kamikaze drone narrowly missed him the day before.

"Yesterday was my second birthday,” he writes on that Facebook post after narrowly escaping death.“The Russian Lancet (drone) missed me by three metres, which possibly saved us.”

Russia's invasion of Ukraine prompted a series of sanctions on Russian individuals, companies and trade by the European Union, the United States and wealthy G7 nations. Switzerland has kept in line with the EU, implementing its tenth package of sanctions in March.

That has not stopped the international community - including NGOs and more recently the G7 - from criticising Switzerland for not doing enough. They particularly point the finger at the limited amount of Russian assets frozen in Switzerland and argue the Alpine nation could do a better job enforcing sanctions.

In this series we look at what steps Switzerland has taken to conform to international standards and where it lags behind. We question the grounds for sanctions and their consequences for commodity traders based in Switzerland. We also analyse Russian assets in the country and understand how some oligarchs are navigating sanctions.

Western components – including Swiss ones – are used to make drones like the one that injured Starukh. Numerous stories of successful Russian Lancet drone attacks abound on Ukrainian social media and in the Russian press. Kyiv is pressuring its allies to do more to starve Russia of the components needed to make this lethal weapon. But Moscow is determined to ramp up their production and has proven savvy at circumventing sanctions.

The Lancet is a small drone that flies at relatively high altitudes. It is compact, stealthy, agile and hard to shoot down. Its primary function is target detection and destruction. Lancets usually work in pairs. A first reconnaissance drone detects the target. The Lancet is then launched to destroy it. With a reported price tag of $35,000 (CHF31,500) Lancets are considered cheap, efficient and easy to handle.

In August, Russian President Vladimir Putin ordered Rostec, a state corporation created to assist in the development and production of civil and military products, to boost their production. Putin was quoted as saying by the Kremlin External lin that these drones have proved particularly effective in battle.

“The explosion is powerful, any equipment, including foreign-made equipment, not only burns, but also explodes,” Putin reportedly said at the meeting with Rostec boss Sergei Chemezov.

SWI swissinfo has obtained verified documents with new information, showing that Lancet drones landing in Ukraine in June contain components from Western companies, including Swiss ones, produced this year. Russian middlemen, called fixers, as well as Russian and Ukrainian officials also provided detailed information on how Russia bypasses international sanctions and ensures Russian drones are constantly supplied with foreign components. Russian official statements to Western media are rare since the start of Moscow's war in Ukraine.

The data shared by Ukrainian sources in August was exclusively viewed by SWI swissinfo. While media reports have already pointed to the use of Swiss-manufactured chips in Russian drones, notably the Lancet and similarly efficient Orlan or Shahed drones, what is new is that data shows that some of these chips were produced in 2023. And this despite efforts by both the companies and the Swiss government to end all exports of these chips to Russia or third countries re-exporting them.

During our analysis of the documents, SWI swissinfo found that at least 19 foreign-made electronic components were identified in Lancet drones. The two Swiss companies identified in the document were STMicroelectronics and u-blox. Both Swiss firms were previously named in other reports published by thinktanks in Ukraine and the United Kingdom.

The documents seen by SWI swissinfo show that a Russian company called VMK is one of the leading suppliers of various electronic components in Russia. From January to March 2023, the company imported STMicroelectronics products into Russia for a total value of $53,500. The countries of origin listed for these products are China, Malaysia and the Philippines. The goods were shipped from Hong Kong.

Sanctions were imposed on VMK by Switzerland in August 2023 and by the United States in September 2023. The information reviewed by SWI swissinfo did not specify that the specific components that VMK imported into Russia were used in the Lancet drones.

“In the process of analysing information regarding electronic components found in unmanned aerial vehicle (UAV) Lancet samples, at least 19 foreign-produced electronic components have been identified. Additionally, the use of u-blox satellite navigation modules manufactured in Switzerland has been recorded,” confirmed Oleksandr Novikov, head of the Ukrainian National Agency for the Prevention of Corruption (NACP)External link , in an interview with SWI swissinfo. Since the beginning of the war the Ukrainian agency is also in charge of identifying a sanctions list of Russian individuals and assets.

To identify the companies supplying these electronic components, NACP analysed information from various Ukrainian government sources. According to SWI swissinfo's sources, Russians are destroying evidence of where the chips originate from. They confirmed they could identify the company manufacturing the equipment thanks to special equipment. They also said analysis of trade data confirmed how these were making their way into Russia.

This raises the question of how and what companies are circumventing sanctions to sell foreign-made components to Russia. The European Union and the United States were quick to implement sanctions on Russian assets and individuals at the onset of the war. Switzerland followed suit. To prevent Russia from circumventing sanctions, Switzerland joined an 11th round implemented by the European Union in August 2023. These included a ban on the export of dual-use goods and goods contributing to Russia's military-technical enhancement. These restrictions apply to 87 companies, including those that supplied such goods to Russia from third countries.

“There is close cooperation with the competent authorities in Ukraine, especially for the identification of the components found,” Jürgen Boehler-Marcano from the State Secretariat for Economic Affairs (SECO)External lin , a division of the country's economics ministry, told SWI swissinfo in an interview.

Until recently, investigations had determined that the components found had been acquired by Russia or Iran before February 2022. However, SECO confirmed that Swiss components likely made it into Russia this year as well.“This does not come as a surprise given Russia's huge needs to produce new weapons,” Boehler-Marcano said.

Ukraine in August presented a 47-page document to the G7 countries, stating that over the past three months, more than 600 drone attacks on Ukrainian cities had been conducted using drones containing Western components. Among the component manufacturers were countries within the sanction coalition, including Switzerland, the US, the Netherlands, Poland, Canada and Japan.

A report published in August by the Kyiv School of EconomicsExternal lin , a thinktank, shows that trade volume of foreign components used in Russian drones was up 19% from January to May 2023 compared with the same period in 2022.

“It is necessary to completely halt the identified components not only to Russia but also in jurisdictions of high risk. Manufacturers should be held accountable if they continue to supply goods to Russia themselves and sanctions should be imposed on those companies that help supply these elements in circumvention of sanctions,” said Novikov, the head of the Ukrainian National Agency for the Prevention of Corruption in reaction to the findings.

Both Swiss companies identified by Ukrainian government sources condemn the use of their parts in Russia warfare. SWI swissinfo has not found clear evidence of sanctions violations by these companies.“Since the end of February 2022, we have taken actions to comply with the specific requirements of multiple sanction packages and export control measures implemented by the European Union, the United States and partnering countries against Russia and Belarus,” STMicroelectronics said in a written email.

“Immediately after Russia's invasion of Ukraine in February 2022, u-blox stopped all sales to Russia, Belarus and the territories occupied by the Russian army in Ukraine, irrespective of the intended use. Recently, u-blox has also decided not to sell to members of the Eurasian Economic Union (a free trade zone with Russia)”, the company said in a general statement.

“As to how u-blox components have been found in drones used by Russian forces, we can provide the following assumptions, respectively explanations: either these components were purchased before sanctions were in place; or excess inventory was sold on by customers to brokers in countries not applying sanctions against Russia and then shipped into Russia; or smuggled into Russia; or they have been de-mounted from an end product and re-integrated into Russian drones”, the company added.

Chips used in Lancet drones can be found in daily consumer goods such as e-scooters, e-bikes, cars, toys or in construction machines. They can easily be extracted from these products and resold on a secondary market. These chips are not classified as military equipment and their exports were in no way regulated before the war. They are embedded in the drone and enable navigation.

The simplicity of their use and sheer number already in the market means it's near impossible for companies to track what happens to their chips once they are sold to a third party.

"There's not much that can be done. The technology used in these drones is widespread outside the realm of military control. You can set up systems, but control is only feasible for the distribution of really complex and expensive systems. However, the chip [ST Microelectronics] that Ukrainian media write about, is readily available on the market. I looked on the Chinese e-commerce website Alibaba yesterday, and it can be ordered for $250”, said Valery Shiryayev a military expert with the independent Russian newspaper Novaya GazetaExternal lin .“The production of Lancets doesn't require precision machinery”.

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