Under the EU Merger Regulation, the European Commission has approved the creation of a joint venture by Daimler AG, of Germany, and Kamaz OJSC, of Russia, a producer of trucks, but also of a large variety of armoured vehicles, some of which are in use in the Ukraine conflict.

According to the Commission press release, Daimler is active in the development, manufacture and distribution of automotive products (mainly passenger cars, trucks, vans and buses), while Kamaz is active in the production of trucks, trailers, tractors, chassis, engines, power units, and armoured vehicles.

The joint venture will be active in the production of light and heavy trucks, and in the welding and painting of truck cabins. The Commission’s investigation found that the proposed acquisition will not raise any competition concerns, because the joint venture will only be active in Russia and Belarus. The EX executive examined the operation under the simplified merger review procedure.

EURACTIV asked the Commission to comment to what extent the merger is compatible with the sanctions adopted by the EU vis-a-vis Russia, in the context of the annexation of Crimea and the Ukraine crisis.

These restrictive measures include an embargo on the import and export of arms and related material from/to Russia, covering all items on the EU common military list. Upon initial examination, it appears that many armoured vehicles are in use by pro-Russian forces in the eastern Ukraine conflict.

EURACTIV also asked is it possible that the Commission services responsible for competition didn’t notice that Kamaz is a firm primarily dealing with military equipment. A catalogue of some of the military production of Kamaz can be seen here. No answer was received by the time of the publication of this article.

It appears that in spite of the restrictive measures, Russia is bragging that not a single major joint project with Western partners has been suspended over the EU sanctions, as Rostec Corporation’s general director Sergei Chemezov was recently quoted as saying by the website Russia beyond the Headline.

“None of the projects launched earlier has been halted,” he told reporters in Abu Dhabi on Monday, citing as an example the project to manufacture AgustaWestland Italian helicopters which continues in Russia.

On the contrary, he said, the project will be expanded and the production of a new helicopter is to be launched for use in offshore operations.

Chemezov also said that AvtoVAZ continues cooperating with Renault-Nissan and Kamaz with Daimler.

The first media to report about the assumed discrepancy between the Daimler-Kamaz merger and the EU sanctions was Bulgarian website ClubZ.bg.