The Service on the Surveillance for Consumer Rights Protection and Human Well-Being of the Russian Federation has published today a draft law (the “Bill“) on the introduction of amendments into the Russian Code on Administrative Violations.
According to the Bill, it is proposed that an administrative fine be imposed for the realization, storage, and/or transportation of goods that are currently subject to the food embargo introduced by Russia as a response to the Ukraine-related sanctions. Specifically, legal entities committing the said violations of the Russian food embargo may receive 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 be subject to an administrative fine of up to RUB 5 000 (approximately USD 80). Although it is not directly stated in the current text of the draft Bill, there is an understanding that the storage and transportation of the embargoed products would only constitute an offence if done for commercial purposes, as opposed to the personal consumption needs of a particular individual. Before this legislative initiative, local distribution of embargoed food products was not subject to any sanctions and/or restrictions.
At the moment, public consultations concerning the amendments are being carried out. We estimate that these amendments could be formally adopted by the Russian Parliament in the near future. We will continue monitoring the status of this legislative initiative.
Taking into account the recent initiatives, including the one restricting state owned companies from depositing funds with Russian subsidiaries of the foreign banks that refuse to service Russian sanctioned entities, we are seeing evidence of an increasing trend in Russia of additional measures to counteract the unilateral sanctions imposed on Russia by some jurisdictions and to strictly enforce the Russian restrictions introduced in this context.