Business & Human Rights Resource Centre

2-8 Scrutton Street, 2nd Floor

London, EC2A 4RT, UK

Tokyo, August 1, 2024

Dear Ella Skybenko and Vladyslava Kaplina

I would like to respond on behalf of DMG MORI to your email dated July 22nd, 2024 regarding the MDR article issued on June 27th.

Although the article wrote as if DMG MORI had continued sales and other activities in Russia, even with military companies, we would like to reiterate that DMG MORI has ceased all business activities in Russia as clearly stated and re-confirmed in a series of announcements on March 3rd, 2022, September 29th, 2023, and October 25th, 2023, on our website.

After the outbreak of the war in Ukraine, we have done everything we can do immediately and consistently stop our activities in Russia. Since then, we have not supplied any machines, spare parts, or technology to Russia and have not carried out any commissioning, service, or training activities.

The employees of the sales and service companies in Russia were dismissed immediately, with the exception of a few employees in Moscow who work in legal administration and asset management. In fall 2023, we conducted an internal investigation against media allegations, which revealed that former employees had sold 122 machines produced in Russia on their own authority and without the knowledge of the properly authorized management. We were able to identify three companies as the main distributors. Even though we are certain that no applicable laws, sanctions, or export regulations have been violated, and we could not have supervised or controlled the former employees in our capacity, we deeply condemn these actions.

As for our factory in Ulyanovsk, we have completely stopped its operation and left only three employees to conserve facilities and prevent our technologies from falling into the hands of the Russian government. However, the Russian government expropriated the plant on February 19th, 2024, as reported by the media and confirmed in our quarterly financial report (April 26th, 2024) and “Consolidated Financial Statements for the First Quarter of the Fiscal Year 2024” (Japanese only, May 10th, 2024). We currently have no right or possibility to investigate the current factory operation or access any relevant information.

Through rigorous screening and management, DMG MORI has been committed to preventing its machine tools and technology from being used as a threat to world peace, not only in Russia but also in other countries and organizations with military concerns.

As part of our efforts, we are globally implementing relocation detection devices to prevent unauthorized and unnotified transfer or use. The implementation began in 2006 with machines produced in Japan, and since 2023 all the machines from DMG MORI factories, including those in Europe and other countries, have been equipped with this device. In fact, we do not deliver products if the customer refuses to install the device. This resulted in the cancellation of about 8 billion yen in FY2023 alone, but we are willing to make such a sacrifice for export control.

As a manufacturer of dual-use goods, DMG MORI is fully aware of the importance of export control. We have established highly strict internal policies and protocols for export control, and we will continue with these rigorous measures to fulfill the social responsibility at all costs.

Our thoughts continue to be with the people in Ukraine. Especially for them we hope for a speedy end to this terrible war

Kazuya Yagi

General Manager

Export Control Operation Office

DMG MORI CO LTD.