As NATO and the EU seeks to increase pressure on Russia and the Crimea, the EU expanded its sanctions against Russia on 12 September. This is the latest in a series of measures introduced since March in response to the Ukraine crisis.

In this update, Nick Burkill identifies the latest changes, and sets out a consolidated summary of the current EU sanctions, identifying their scope and the individuals, companies and other organisations required to comply with the provisions.

Criminal offences

The UK has created criminal offences for breach of European Union sanctions against Russia, Crimea and Sevastopol:

  • An offence of contravening the sanctions
  • An offence of intentionally participating in activities knowing that the their object or effect is to circumvent sanctions or enable or facilitate contravention of sanctions
  • An offence by officers of a company of consenting to or conniving in a company’s contravention of sanctions
  • An offence by officers of a company whose contravention of sanctions is attributable to any neglect of the officer

The UK’s anti-money laundering legislation provides additional offences where property constitutes a benefit from the breach of sanctions and the person charged knows or suspects that the property constitutes such a benefit, subject to the usual defences of having disclosed the position to the authorities and obtained a consent to proceed.

Other EU states are also required to impose criminal penalties for breach of the sanctions.

September Sanctions

The latest sanctions:

  • Add individuals or entities transacting with the separatist groups in the Donbass regionof Ukraine to the list of persons subject to the existing provisions prohibiting access to funds or economic resources without a licence.
  • Extend the prohibition on the sale, supply, transfer or export of dual use goods and technology to goods and technologies subject to export licensing controls under regulation 429/2009 including certain electronics and computers to 9 specified organisations in Russia connected with the defence sector
  • Extend the prohibition on technical and financial assistance to the 9 organisations in Russia
  • Extend the technologies subject to the prohibition on supply of services for deep water exploration oil and production, arctic oil exploration and production and shale oil projects in Russia to drilling, well testing, logging and completion services and the supply of specialised floating vessels
  • Extend the prohibition on the supply of financial assistance relating to goods and technologies on the common military list to insurance and reinsurance
  • Extend the prohibitions relating to transferable securities or money market instruments to those issued after 12 September 2014 with a maturity exceeding 30 days to the Russian banks previously subject to a prohibition in respect of instruments with a maturity exceeding 90 days; and to additional identified Russian entities connected with the defence and oil sectors
  • Prohibit making or arranging loans or credit with a maturity exceeding 30 days to the same Russian banks and defence and oil sector entities

Consolidated EU sanctions

Affected persons are prohibited from doing the following:

  • Entering or travelling through the EU
  • Dealing with and allowing access to funds or economic resources of designated person without a licence
  • Making funds or economic resources available to or for the benefit of a designated person without a licence
  • Purchasing selling providing brokering or assistance in the issuance of or dealing withtransferable securities or money-market instruments with a maturity exceeding 90 days, issued between 1 August and 12 September 2014 or with a maturity exceeding 30 days if issued after 12 September 2014, by one of 5 identified Russian banks or 6 identified Russian entities connected with the defence and oil sectors or an entity established outside the EU 50% owned by such an entity, or a person acting on their behalf
  • Selling supplying transferring or exporting arms and related materiel to Russia
  • Providing financing, financial assistance, technical assistance, brokering or other services related to military activities to any person in or for use in Russia
  • Selling supplying transferring or exporting dual use goods and technology to any person in Russia or for use in Russia if the items are or may be intended for military use or for a military end-user or to 9 identified Russian defence sector entities or financing financial assistance, technical assistance, brokering or other services related to these
  • Selling supplying transferring or exporting identified technologies for deep water oil exploration and production, arctic oil exploration and production or shale oil projects in Russia
  • Providing financing, financial assistance, technical assistance or training related to affected oil technologies to any person in or for use in Russia
  • Importing goods originating in Crimea or Sevastopol into the EU or providing financing or financial assistance or insurance related to the import of such goods
  • Financing the creation, acquisition or development of infrastructure or exploitation of energy in Crimea or Sevastopol
  • Acquiring or extending participation in enterprises established in Crimea or Sevastopol engaged in the creation acquisition or development of transport, telecommunications or energy or the exploitation of energy in Crimea or Sevastopol or creating joint ventures for such projects
  • Providing technical assistance or brokering services related to such infrastructure or energy projects
  • Selling supplying transferring or exporting identified infrastructure and energy equipment and technology to any person in or for use in Crimea or Sevastopol
  • Providing financing, financial assistance, technical assistance, brokering or other services related to infrastructure and energy equipment and technology to any person in or for use in Crimea or Sevastopol

UK reporting obligations

Relevant institutions are required to report the following to the UK Treasury as soon as practicable where information came to it in the course of carrying on its business:

  • That a person is a designated person
  • That a person has breached the sanctions
  • Details of funds or economic resources held on behalf of customers who are designated persons

Persons required to comply with the sanctions

The sanctions apply to:

  • Acts carried out in the EU
  • Acts carried out on any aircraft or vessel under the jurisdiction of an EU state
  • Nationals of EU states
  • Companies and other legal persons established in the EU
  • Any company or legal person in respect of any business done wholly or partly in the EU

Designated persons

The UK consolidated list of both natural and legal persons subject to the sanctions can be found here.