Kremlin Suspends New Contract Signing by Roscosmos and Rosatom in Nations Sanctioning Russia

On April 18, 2018, Kommersant reported that Russian Deputy Prime Minister, Dmitry Rogozin, had ordered Rosatom and Roscosmos to suspend the signing of new contracts with companies from nations that have introduced further “anti-Russian” sanctions.  This came on the same day that the speaker of the Russian upper house of parliament was cited as stating “Moscow’s response to U.S. sanctions will be targeted and painful.”  While the order, which was made last week, will not affect ongoing contracts, it is expected to restrict U.S. access to hatch module technologies required for the Lunar Orbital Platform-Gateway.  Roscosmos’ RD-180 engine is also seen as an essential component of the U.S. Atlas rocket and other satellite launch vehicles.

This move comes as somewhat of a surprise as Roscosmos and Rosatom both have a large footprint outside of Russia, with IntelTrak identifying 40 and 224 transactions for these companies, respectively (including pending, past and ongoing projects), including in the U.S., EU and NATO markets.  Kommersant seemed to acknowledge the potential counterproductive nature of the action, observing, “for Rosatom, the possible ban on new contracts with the U.S. or EU could be very painful.”  It is likely that these companies will, in time, push back against the wisdom of this Kremlin initiative.