Rosneft has failed in an application for interim relief to stay the effect of UK legislation criminalising violations of EU restrictions on the export of equipment or technology used in artic or shale oil and gas exploration.  The EU restrictions are contained at Council Regulation (EU) No 833/2014 as amended by Council Regulation (EU) No 960/2014. UK secondary legislation (the Export Control (Russia, Crimea, Sevastopol Sanctions) Order 2014, SI 2014, No 2357, as amended by the Export Control (Russia, Crimea, Sevastopol Sanctions) (Amendment) Order 2014 SI 2014, No 2932) introduced criminal penalties for breaches of EU restrictions.

Rosneft sought interim relief in the form of an injunction staying implementation of the revised UK secondary legislation, pending the outcome of an application for judicial review of that legislation. It did so on grounds including that the nature of the EU restrictions relating to ‘deep water’ and ‘arctic’ oil exploration and production, and ‘shale oil projects’ were so uncertain that the criminal offences did not meet common law or EU jurisprudence tests for certainty.  Council Regulation (EU) No. 1290/2014 now clarifies these restrictions; please see the story on Russia Sanctions amendments below for further information.

The UK’s High Court considered the relevant case law and held that, notwithstanding that such terms contained some degree of uncertainty (recognised in a letter sent by the Department for Business, Innovation and Skills to Rosneft), the restrictions were not so uncertain as to be void.

Rosneft’s full challenge in the High Court for judicial review of the UK implementation of these restrictions is expected to be heard in January. Rosneft is separately challenging the EU restrictions in the European Court of Justice.