Identical Products, Same Stores: Did Fashion Giant Zara Truly Exit Russia?

Zara currently rules out any return to Russia. This was confirmed by Óscar García Maceiras, the CEO of the Inditex group, in an article published on June 20 in the Financial Times, stating that the conditions for the company’s return to this region are not yet present. But has the company completely given up on this country, which accounted for 8.5% of its net income and 5% of its revenue (about 1 billion euros)?

This is the question posed by a nearly 50-page report that Challenges had access to. Produced by a group identifying as Ukrainian whistleblowers, it delves into the revelations of the Financial Times published last May and highlights the ties between the Spanish fashion giant and the Lebanese group Daher, which took over its store network in March 2022, shortly after the Russian invasion of Ukraine.

First, the historical links. Although the Daher group was previously unknown, its shareholders are not. The two brothers leading the group are indeed part of the Daher family, owners of Azadea, a heavyweight Zara franchisee in the Middle East and Africa since 1998. Moreover, Zara’s contract with the acquirer of 245 of its Russian stores includes the possibility that Daher could become one of its franchisees. “In the event of new circumstances that, in Inditex’s opinion, could allow the group’s brands to return to this market, Inditex and the Daher group consider in their agreement the possibility of a collaboration between them through a franchise agreement,” stated the group in 2022. Specifically, Daher would even be obliged—if Zara decided—to become its franchisee.

An internal source within Inditex also confirms that the choice of the Daher group is explained notably by its experience as a Zara franchisee. However, the sale had been presented as a transfer to an actor “unrelated” to Inditex. Thus, two narratives clash: on one side, that of Zara, where an actor without ties to the group maintains the possibility of becoming its franchisee. On the other, that of the report, where one of Inditex’s historic franchisees prepares to take over the operation of its flagship license in a new territory.

Other links raised by the report concern the financial aspect. Indeed, the transfer of Zara in Russia was made for a “non-significant” sum according to Inditex’s terms, even though the subsidiary was highly profitable. Moreover, the group had contributed 57 million euros to the capital of its Russian subsidiary just two months before transferring it to the Daher group. What interest did it have in investing in an asset that it was about to transfer? Here again, the interpretation can be dual: either Inditex, pushed by the urgency to leave Russia, hastily transferred its brand without even valuing it and without cutting off its funding; or the agreement was made amicably between the group and its future franchisee. “The transaction was not carried out under normal market conditions, and no financial compensation was paid,” assess the authors of the report.

Another point that puzzles them: the speed with which the Daher group entered the Russian market, while it was—officially—completely inexperienced in the fashion sector. Indeed, just a few months after the deal, it launched a series of brands, including Maag, a brand very close in positioning to that of Zara. The names of these new brands had also been registered six months before the official transaction.

To get ready for battle and recruit, the Daher group also seems to have shopped at… Zara. It notably poached 8 employees from Inditex in Spain. For instance, Eloy Cabarcos, a senior buyer at Pull & Bear (Inditex) took over the purchasing direction within the new entity. Again, the massive scale of these “poachings” raises questions. From its side, Inditex acknowledges that a good portion of Zara’s Russian employees were taken over by Daher: “One of our company’s priorities was finding a formula that would maintain as many jobs as possible for the employees of the Inditex group in Russia.” But what about those who came from Spain?

Similarly, the Lebanese acquirer appeals to the same subcontracting factories as its predecessor, such as AZ Apparel in Pakistan. “The suppliers of Inditex products are by no means exclusive suppliers,” retorts the group. “As is often the case in our sector, suppliers and manufacturers maintain commercial relationships with several clients.”

Same teams, same subcontractors… Zara and Maag (the brand owned by Daher replacing it in Russia) also offer very similar products, if not almost identical. Leopard print pumps, a long white dress with black stripes, green sneakers with a yellow sole… “Between February and June 2025, we monitored the Maag website,” recounts one of the sources behind the report. “In total, 124 products identical to those from a Zara collection were identified.” Not to mention the design of the stores, which also resemble each other.

In the corridors of the Inditex group, if one is aware of these similarities, it is believed that the Daher group is engaging in the national sport of fast fashion: drawing inspiration from what works. However, Zara does not indicate an intention to sue for copyright infringement its successor in the Russian market. This irritates the authors of the report: “It is undeniable that the products are not only similar, they are identical. It is therefore surprising that Inditex has not taken measures against the Russian brands,” especially legally.

At Inditex, it is emphasized: a publicly traded company—and thus with public accounts—could not secretly maintain an activity in Russia. On the other hand, the group’s detractors persist: “Inditex maintains a real influence on Russian consumers and an indirect presence in the market.” Likely, both parties are right: by formally leaving Russia while entrusting the operation of the stores to a future franchisee who already perfectly copies the brand, Zara does everything to facilitate its potential return to the country.