Specialised importer company that owes hundreds of millions to state transferred from Ukraine's Defence Intelligence to Defence Ministry

At a meeting on 4 October, the Cabinet of Ministers of Ukraine decided to transfer the integral property of the self-supporting foreign trade company SpetsTechnoExport, a subsidiary of the state-owned company UkrSpecExport, to the Ministry of Defence.

Source: press service of the Ministry of Defence

Quote: "Due to the problems with receivables and other financial and economic irregularities, the Ministry of Defence initiated an audit of SpetsTechnoExport.

This decision was made after the audit team faced significant obstacles during the internal audit, including limited access to documents and the accounting system."

Details: According to the Ministry of Defence, the main problems include not providing access to original documents, delays in providing information, and incomplete responses to requests, which makes it difficult to conduct a full audit.

This is the Ministry of Defence's first attempt to audit SpetsTechnoExport activities in the last two years since the company was transferred from Ukroboronprom, the state-run defence concern and strategic manufacturer of weapons and military hardware in Ukraine, to Defence Intelligence of Ukraine in 2022.

The ministry adds that as part of further reforms, there are plans to disband specialised importer companies and transfer their functions to the Defence Procurement Agency to avoid duplication of functions and increase the efficiency of defence processes.

Background: On 4 October 2024, Ukrainska Pravda published an investigation stating that the arms importing company SpetsTechnoExport, which had been under the control of Defence Intelligence of Ukraine (DIU) since 2022, has been concluding arms purchase agreements at inflated prices, not always fulfilling billion-dollar contracts, and accumulating more than UAH 800 million (about US$19.3 million) of state debt. This is just the amount officially recognised by the courts.

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