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New package of sanctions from the EU and US, and other recent developments


In this sanctions alert we provide an update on recent developments in the EU, UK and US sanctions against Russia.

This includes the EU's 14th sanctions package adopted today, which introduces new restrictions on Russian LNG, new tools to battle circumvention including obligations relating to subsidiaries abroad, further restrictions on import- and export as well as new designations. We also include an update on the new US sanctions against Russia such as expansion in US secondary sanctions criteria, restrictions on software and IT-related services and additional designations.

EU adopts 14th sanctions package against Russia

Today, on Monday, June 24, the EU Council adopted the 14th sanction package against Russia, including measures targeting the LNG sector and new measures to battle with circumvention, such as a requirement for EU companies to undertake best efforts to ensure that third-country subsidiaries comply with EU sanctions.

1) New restrictions on LNG

The EU has introduced its first restrictions on Russian liquefied natural gas (LNG):

  • Reloading services of Russian LNG within EU waters for the purpose of transhipment operations to third countries will be banned.
  • The EU will prohibit new investments and provision of goods, technology and services for the completion of LNG projects under construction, such as Arctic LNG 2 and Murmansk LNG.

2) New tools to battle with circumvention

Similar to the previous sanctions packages from the EU, this package focuses on anti-circumvention measures:

  • EU parent companies will be required to undertake their best efforts to ensure that their third-country subsidiaries do not take part in any activities resulting in an outcome that the sanctions seek to prevent.
  • EU operators selling battlefield goods to third countries will need to implement due diligence mechanisms capable of identifying and assessing risks of re-exportation to Russia, and mitigating them.
  • EU operators transferring industrial know-how for the production of battlefield goods to third-country commercial counterparts will now have to include contractual provisions to ensure that such know-how will not be used for goods intended to Russia.

3) Finance measures 

Several financial measures have also been introduced: 

  • The EU has banned the use of the System for Transfer of Financial Messages ("SPFS"), a specialised financial messaging service developed by the Central Bank of Russia to neutralise the effect of restrictive measures. EU operators will not be allowed to connect to the SPFS or equivalent specialised financial messaging services, and be barred from making transactions with specifically listed entities using SPFS outside of Russia
  • The EU has introduced a ban on transactions with targeted credit and financial institutions and crypto assets providers established outside of the EU, when used to facilitate transactions that support Russia’s defence-industrial base. 

4) Funding of political parties and other organisations

  • The EU has decided that political parties and foundations, NGOs including think tanks, or media service providers in the EU, will no longer be allowed to accept funding coming from the Russian state and its proxies.

5) Transportation 

The EU has introduced several measures aimed at transportation: 

  • 27 vessels are now subject to port access ban and ban on provision of services. The vessels have been targeted for various reasons, such as for being involved in transportation of military equipment to Russia, and the sanctions also targets the so-called "dark fleet" circumventing the EU and the Price Cap Coalitions caps while adopting deceptive shipping practices. 
  • The EU has also widened the EU flight ban and the prohibition on transportation of goods by road. 

6) Import and export restrictions 

The EU has introduced several designations and expanded on the import/export restrictions: 

  • 61 new entities are designated for being involved in the support of Russia's military and industrial complex in its war against Ukraine. Some of these entities are located in third countries such as China, Kazakhstan, Kyrgyzstan, Türkiye, and the United Arab Emirates that have been involved in the circumvention of trade restrictions and engaged in the procurement of sensitive items used for example in the production of drones, or providing material support for Russian military operations.
  • The list of restricted items has been expanded that could contribute to the technological enhancement of Russia’s defence and security sector
  • The EU has introduced further restrictions on exports of goods which contribute in particular to the enhancement of Russian industrial capabilities (e.g. chemicals, including manganese ores and compounds of rare-earths, plastics, excavating machinery, monitors and electrical equipment), as well as further restrictions on the import of helium from Russia, which is a source of significant revenues for the regime.

7) Other measures 

  • The package includes a protection for EU operators, where they can claim compensation from damages caused by Russian companies due to sanctions implementation and expropriation. 
  • The package imposes restrictions on accepting applications for registrations in the EU of certain intellectual property rights by Russian nationals and companies. 
  • It is also forbidden to purchase, import, transfer or export Ukrainian cultural property goods and other goods of archaeological, historical, cultural, rare scientific or religious importance, where there are reasonable grounds to suspect that the goods have been unlawfully removed from Ukraine.

The Regulation will shortly be published in the EU Journal, and the measures are explained in more detail in the Press Release from the EU

EU sets up new country-specific framework for restrictive measures against those responsible for human rights violations

On May 27, the EU established a new sanctions framework targeting individuals responsible for serious human rights violations, suppression of civil society and democratic opposition, and undermining democracy and the rule of law in Russia. 

The sanctions include asset freezes and travel bans for listed individuals and entities, including the Federal Penitentiary Service of Russia and various judges and prosecutors involved in politically motivated charges and imprisonment. The framework also imposes trade restrictions related to equipment and technology potentially used for internal repression or monitoring communications.

According to the EU, the decision to establish this new sanctions’ regime is part of the EU’s response to the accelerating and systematic repression in Russia and was proposed following the death of the opposition politician Alexei Navalny. 

US further strengthens its sanctions against Russia 

The US Department of the Treasury on 12 June 2024 introduced sweeping new measures guided by G7 commitments to intensify the pressure on Russia. 

1) Expansion on US secondary sanctions risk criteria 

The US has broadened the definition of Russia’s military-industrial base to include all persons blocked pursuant to Executive Order (EO) 14024. In practice, this means that foreign financial institutions risk being sanctioned for conducting or facilitating significant transactions, or providing any service, involving any person blocked pursuant to EO 14024

2) Designations of Russian banks 

The US has updated the SDN list to include information for five sanctioned Russian financial institutions to include the addresses and aliases of their foreign locations. This includes banks in China, India and Hong Kong. 

 3) Restrictions on software and IT-related services 

A new determination is introduced under EO 14071, which prohibits supply of IT consultancy and design services, as well as IT support services and cloud-based services for enterprise management software and design and manufacturing software to Russia. 

4) New designations 

  • Designations of key operators within the Russian financial infrastructure including PJSC Moscow Exchange, Gas Industry Insurance Company Sogaz (Sogaz), Joint Stock Company Russian National Reinsurance Company (RNRC). 
  • Designations of more than 100 entities that operate or have operated in the defense and related materiel, manufacturing, technology, transportation, or financial services sectors of the Russian Federation economy.
  • Designations of networks attempting to evade sanctions using convoluted schemes to move money and other valuable goods and assets, where more than 12 such networks have been targeted including more than 90 individuals and entities across Russia, Belarus, the British Virgin Islands, Bulgaria, Kazakhstan, the Kyrgyz Republic, the PRC, Serbia, South Africa, Türkiye, and the United Arab Emirates (UAE).  
  • Designations of entities involved in three liquefied natural gas (LNG) projects that Russia hopes to bring online in the future: the Obsky LNG, Arctic LNG 1, and Arctic LNG 3 projects. 
  • Designation of more than 100 entities that operate or have operated in the defense and related materiel, manufacturing, technology, transportation, or financial services sectors of the Russian Federation economy.
  • Designation of entities involved in three liquefied natural gas (LNG) projects that Russia: the Obsky LNG, Arctic LNG 1, and Arctic LNG 3 projects. 

Note that for some of the designated entities, General Licenses have been issued permitting the wind-down of transactions

Recent developments from the UK 

The UK Government made several adjustments and additions to its Russia sanctions regime in June 2024. On June 14, corrections were made to the entries for the Central Counterparty National Clearing Centre and LLC Kompaniya AMG on the UK sanctions list, maintaining their status under asset freeze and trust services sanctions. Additionally, on June 13, the government expanded the list, adding 42 entities, including seven individuals, 35 other entities, and six vessels, aimed at undermining the financial and operational capabilities of Russia's war efforts.

Furthermore, two Office of Financial Sanctions Implementation (OFSI) General Licences expired in June; one facilitated asset transfers under specific conditions, and the other involved the winding down of operations with certain entities. The Russian sanctions guidance was also updated to include new measures on director disqualification and ship specifications.

In addition, we note that there are two new UK court decisions on the interpretation and application of UK sanctions. 

  • First, the High court judgment Vneshprombank LLC v Bedzhamovwhich clarified the conditions required to establish an offense under Regulation 11 of the Russia (Sanctions) (EU Exit) Regulations. 
  • Second, the English Court of Appeal judgement on the interpretation and application of the UK sanctions regime in the case of Celestial Aviation Services v UniCredit Bank concerning the enforcement of Russian sanctions and the impact of US sanctions on obligations governed by English law regarding payments.
Profile image of Tine Elisabeth Vigmostad
Tine Elisabeth Vigmostad
E-post tvi@wr.no
Profile image of Narve Nilssen
Narve Nilssen
E-post nni@wr.no

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