EU publishes 12th sanctions package against Russia

Legal framework

In cases where international peace and/or security is threatened, Article 21 of the Treaty on European Union ("TEU") empowers the EU to act and, under Article 29 TEU, to impose sanctions on countries, organisations, companies and/or individuals, such as[1] :

1. Various forms of economic sanctions (such as a ban on importing or exporting certain goods, on providing certain services, etc.);
2. Financial sanctions (freezing assets and economic resources of listed individuals or entities);
3. Arms embargoes; and
4. Restrictions on admission to EU territory.

The sanctions against Russia include import and export bans on certain goods and technologies, bans on providing certain services, bans on financing the Russian Federation and bans against circumventing EU sanctions.

In addition, the EU has added many Russian individuals and entities to its consolidated sanctions list by way of financial sanctions measures. Individuals and entities on this list are subject to restrictive measures; their assets are frozen and, in addition, it is forbidden - as an EU citizen or company - to (in)directly provide them with economic resources (anything of economic value). Doing business (in)directly with these persons and/or entities is therefore also not allowed.

Twelfth sanctions package

With the 12th sanctions package, the EU aims - in addition to the above - to make it even harder for Russia to continue the war. Among other things, the package oversees:

1. Additional import and export bans

First, the EU expanded the list of goods subject to import and export bans. Thus, the list of goods that could contribute to the technological improvement of the Russian defense and security sector has been expanded to include: chemicals, lithium batteries, thermostats, DC motors and servomotors, machine tools and machinery parts.

In addition, the EU has introduced further restrictions on the import of goods that generate significant revenue for Russia and thereby support the continuation of the war against Ukraine. Products covered include pig iron, mirror iron, copper wires, aluminum wires and liquefied propane (LPG). There is also a ban on the import, or at least purchase or transfer, of (non-industrial natural and synthetic) diamonds from Russia.

1. Additional measures against circumvention of EU sanctions

Furthermore, the EU has adopted additional measures against circumvention of EU sanctions. For example, EU exporters are required to include in their contracts a ‘No-Russia Clause’. This clause means that when selling, delivering, transferring or exporting to a third country, re-exporting to Russia and re-exporting for use in Russia of particularly sensitive goods and technology is prohibited.

Furthermore, the EU has extended the transit ban on dual-use goods and technologies exported from the EU to third countries via Russia to all battlefield goods. This should prevent products sent via Russia to third countries from remaining in Russia anyway.

1. Additional Russian individuals and entities added to EU consolidated sanctions list

Lastly, the EU has added another 61 individuals and 86 entities to its sanctions list. The new placements include individuals and/or entities directly supporting Russia's military and industrial complex in its war of aggression against Ukraine, responsible for circumventing EU sanctions but also responsible for the forced takeover of Russia-based companies from the EU.[2]

Conclusion

The foregoing shows that with the 12th sanctions package much has changed, or at least will change, in terms of regulations concerning the situation with Russia. This underlines the importance for EU citizens and companies to regularly check that they are not - where relevant - in violation of these sanctions packages.

About Ploum's International Trade, Customs and Food and Commodities practice team

The specialists in our International Trade, Customs and Food and Commodities Practice team will be happy to assist you if you have any questions on this topic, or any other issues surrounding International Trade, Customs or Food Safety and Legislation. Due to our years of experience in International Trade and Logistics, among other areas, we can provide you with quick and effective service. If you have any questions on this topic, please contact one of our team members or contact Jikke Biermasz (j.biermasz@ploum.nl) or Marijn van Tuijl (m.vantuijl@ploum.nl) directly.