Nearshore Americas

White House Bars US Software Firms from Doing Business with Russia

The US government has effectively prohibited American software from doing business with Russian entities.

The ban, which will take effect in September of this year, attempts to prevent the Russian military from using American tech innovations to their advantage.

Approximately 300 software companies are expected to be hit by the ban, according to a statement from the Treasury Deparment. They won’t be allowed to provide any sort of tech solution to Russian companies; from software in general to cloud services.

This marks the second direct hit from the White House to Russia’s tech sector. About a week befor the software ban, US authorities imposed sanctions on the sale of semiconductors to Russian firms.

The Treasury Department emphasized that the ban applies to companies and individuals not directly linked to Russian government entities.

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American outsourcing firms will also be hit by the ban. Third pardy providers will not be allowed to sell, for example, customer support services to Russian companies.

This could pose challenges for the outsourcing industry in the US. Support agents based in the US could receive service requests from Russian entities through their employer, who might be based in Asia and still providing support to Russian firms.

Narayan Ammachchi

News Editor for Nearshore Americas, Narayan Ammachchi is a career journalist with a decade of experience in politics and international business. He works out of his base in the Indian Silicon City of Bangalore.

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