As Russia continues to escalate its military operations in Ukraine, the European Union (EU) and the United Kingdom (UK) unveiled details of new sanctions against Russia. This alert summarises the proposed restrictions.
Ursula von der Leyen, President of the EU Commission, announced the newly proposed restrictions as part of the sixth package of sanctions against Russia. These restrictions include:
An import ban on Russian oil, with the supply of crude oil to be phased out within six months, and refined products by the end of 2022.
A ban on the provision of services to Russian companies by accountants, consultants, and public relations service providers. It is currently unclear which services will be in scope of the ban and whether a transitional period will be granted for EU service providers to comply with the new restrictions.
The expansion of the prohibition on the provision of financial messaging services (including SWIFT) to Sberbank and two additional “major banks” (yet to be named).
A ban on three additional Russian state-owned broadcasters (yet to be named).
Asset freeze restrictions on “high ranking military officers and other individuals who committed war crimes in Bucha and who are responsible for the inhuman siege of the city of Mariupol”.
Although not included in Ursula von der Leyen’s announcement, the EU is also considering restricting the provision of cloud services to Russia.
The measures detailed above are not yet in force and will require approval from EU Member States. The proposed ban on Russian oil may be particularly contentious as Hungary previously indicated it would veto sanctions restricting energy imports.
Similarly, UK Foreign Secretary Liz Truss also announced that the UK would impose further sanctions against Russia, including:
A ban on the provisions of management, consulting, accounting and public relationship services to Russia.
Further sanctions on Russian state-owned broadcasters and new organisations, including RT and Sputnik online.
New asset freeze restrictions on Russian individuals and organisations, including Russian journalists.
The text of the new UK sanctions has not yet been published as of the time of writing this alert. It is therefore unclear which services will be affected, the scope of the new restrictions, and how closely the UK sanctions will align with those proposed by the EU.
Our McDermott team will continue to closely monitor new developments in this area. If you are concerned about the impact of the proposed restrictions on your business, you can reach out to Raminta Dereskeviciute.