EU imposes new sanctions on Russia

Ban on import and export of certain goods and professional services.

Under the EU’s 8th package of restrictive measures against Russia, the export of certain products and services supplied to Russian companies from EU Member States and the import of certain products that have been exported from Russia or are sufficiently likely to have originated in Russia have been banned with effect from 7 October 2022.

By 8 January 2023 at the latest, companies must terminate all contracts concluded before 7 October 2022 that are subject to the ban on the import and export of certain goods and the provision of architectural, engineering, consulting, IT and legal advisory services.

Tightening of the ban on the export and import of certain goods, including foodstuffs

Import restrictions apply to other Russian materials and products that generate significant revenues for Russia, enabling it to act in a way that destabilises the situation in Ukraine.

These include, for example, steel and iron and finished products thereof, cement, concrete, glass, plastics, rubber, fertilisers, wood pulp, paper, cigarettes, coal and coal products (e.g., coke), finished chemical products, including cosmetics, precious metals, stone products, or, for example, ships.

Furthermore, it is forbidden to buy, import or transfer shellfish (seafood) or caviar into the EU.

The export ban applies to items used in the aviation sector, as well as certain chemicals, machinery and equipment or textiles.

Restrictions on professional services and crypto-assets

The new restrictive measures extend the scope of professional services that EU persons can no longer provide to the Russian government or to legal persons established in Russia. These services include IT consultancy, legal advice, architectural and engineering services.

There are a number of exceptions to this prohibition and the competent authorities may allow otherwise prohibited services in certain circumstances. For example, the prohibition does not apply to provision of services strictly necessary for the termination of contracts entered into before 7 October 2022 until 8 January 2023, or to receipt of payments for those services.

The purpose of the exemption is to permit provision of services that are strictly necessary to secure access to judicial, administrative, or arbitral proceedings in the EU or to obtain recognition or enforcement of a judgment or arbitral award rendered in the EU.

In addition, the restriction on the supply of services does not apply to services intended for the exclusive use of legal entities in Russia owned by persons from the EEA and other selected countries, or to services provided to European companies, even if they are fully or jointly owned by Russian citizens.

The existing prohibition on provision of cryptocurrency wallet, account or custody services to Russian persons and entities will now apply regardless of the total value of the cryptocurrencies (the EUR 10 000 [ten thousand] minimal limit no longer applies) .

Restriction on holding positions in Russian companies from 22 October 2022

From 22 October 2022, it is prohibited to hold any position in the governing bodies of any legal person, entity or body listed in the Regulation, e.g., United Aircraft Corporation, Gazprom, or OPK Oboronprom.

Sanctions for non-compliance / violation of EU sanctions

Member States are primarily responsible for applying EU sanctions, for identifying infringements and for applying sanctions in these cases. Therefore, the type and level of sanction for companies for non-compliance/violation of EU regulations may vary from one Member State to another.

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