On the 1st of February the Service on the Surveillance for Consumer Rights Protection and Human Well-Being of the Russian Federation published a draft law (the "Bill") aimed at amending the Russian Code on Administrative Violations.

What the Bill imposes

According to the Bill, an administrative fine will be imposed on the sale, storage and/or transportation of goods that are currently subject to the food embargo introduced by Russia as a response to Ukraine-related sanctions. Specifically, legal entities who violate the Russian food embargo may incur an administrative fine of up to RUB 100,000 (approximately USD 1,700) with or without confiscation of the embargoed food products. If the violation is committed by individuals, each individual offender could incur an administrative fine of up to RUB 5,000 (approximately USD 80). Although not explicitly stated in the current text of the draft Bill, it is understood that the storage and transportation of embargoed products will only constitute an offense if done for commercial purposes, rather than for the personal use of a particular individual. Before this legislative initiative, local distribution of embargoed food products was not subject to any sanctions and/or restrictions.

Entry into effect

At the moment, public consultations concerning the amendments are underway. It is likely that the amendments will be formally adopted by the Russian Parliament in the near future. We will continue to monitor the status of this legislative initiative.

Taking into account recent initiatives – including the one restricting state-owned companies from depositing funds with Russian subsidiaries of foreign banks that refuse to service Russian-sanctioned entities – there is a clear trend in Russia to introduce additional measures to counteract the unilateral sanctions imposed on Russia by some jurisdictions and to strictly enforce the Russian restrictions introduced in this context.