On 19 March 2014, the Australian Government announced it would
impose targeted financial sanctions and travel bans against
particular individuals in Russia and Ukraine. This alert provides a
brief overview of the measures to be imposed, noting that, as the
situation develops, additional sanctions may be imposed.
Financial sanctions and travel bans announced
The Australian Government announced that it would impose
targeted financial sanctions and travel bans against individuals
identified as being instrumental in the Russian threat to the
sovereignty and territorial integrity of Ukraine. At this point in time,
Australia's financial sanctions and travel bans will cover 12
Russian and Ukrainian individuals. The individuals to be the
subject of the sanctions are yet to be identified. However, it is
expected that they will reflect the individuals designated by the US,
including political and military figures close to Russian President
Implementing the sanctions
The sanctions are not yet in force.
Implementing the sanctions is a 2-step process which is expected
to take a month or so to complete:
1. First, the Autonomous Sanctions Regulations 2011 (Cth)
need to be amended to provide the ability to impose
sanctions against the relevant category of people. The
Department of Foreign Affairs and Trade (DFAT) is
expected to follow its usual practice of issuing draft
amendments for public comment.
2. Second, when the Regulations are amended, DFAT's
Consolidated List of persons and entities to which
Australian sanctions apply will be updated to include the
12 Russian and Ukrainian individuals.
Recap on Australia’s Autonomous Sanctions regime
Australia applies the United Nations Security Council (UNSC)
sanctions and autonomous sanctions. In this case, the Australian
Government will use its autonomous sanctions powers to impose
the sanctions. Note that the UNSC is constrained in issuing
sanctions in the current situation due to Russia’s veto power as a
permanent member of the UNSC.
Australia’s autonomous sanctions regime permits a range of
sanctions to be imposed as a foreign policy tool by the Australian
Government. The sanctions can apply across a variety of
industries and otherwise regular business transactions. For
example, Australia’s sanctions regime can restrict or prohibit:
dealing with certain persons, entities generally or in
the direct or indirect use or provision of assets, and most
means of international commerce;
the supply, sale or transfer of goods or services, including
financial services; and
procuring goods or services from sanctioned States or
Importantly, Australia’s sanctions regime has extraterritorial reach.
For example, sanctioned activity could include activities engaged
in by Australian citizens wherever they are located in the world.
Relevance of foreign sanctions to Australian businesses
In announcing these new sanctions, the Australian Government
joined a number of other jurisdictions – including the US, EU,
Switzerland, Austria, Lichtenstein, and Canada – which have
already issued sanctions targeting key senior figures in the former
Ukrainian Government and others involved in the
unrest. Australian businesses with overseas interests should be
cognisant of these international developments, particularly if they
have, or may have, dealings involving people from Russia or the
Australian businesses operating within other jurisdictions need to
be aware of the sanctions laws applying in those jurisdictions, and
whether those laws apply to their business activities.
Businesses that could be impacted by the sanctions should:
Monitor for the sanctions coming into force.
Monitor for further announcements on sanctioned activity.
Exercise sufficient due diligence when conducting
transactions involving, or potentially involving, Ukrainian or
Ensure their transaction screening processes are
comprehensive and kept up to date. Screening processes
need to enable identification of individuals that may be a
sanctioned designated person or entity, and of entities that
may be owned or controlled by a designated person.
Please do not hesitate to contact us if you have any questions
about how these changes might affect your business. If you would
like to receive further updates as Australia's and international
sanctions develop, please let us know.