Trade Practitioner Blog: Ukraine Crisis: Global Sanctions Developments

shot of word sanctionIn light of the current conflict and crisis in Ukraine, we are tracking the evolving sanctions imposed by several governments on Russia and Russia-aligned regions and certain individuals. The jurisdictions in focus are: EUJapanRepublic of KoreaUK  and US.

Latest Developments:

[Updated on March 25, 2022] US – March 24, 2022 : The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued two amended general licenses and two new general licenses involving its Russia-related sanctions programs. OFAC also updated two Frequently Asked Questions to properly reference amended General License 17A in its guidance regarding the scope of that authorization.

  • Russian Harmful Foreign Activities Sanctions Regulations General License 6A: General License 6 authorizes transactions related to the exportation or reexportation of agricultural commodities, medicine, medical devices to, from, or transiting Russia and certain COVID-19-related transactions. Amended General License 6A clarifies that the following transactions are not authorized:
    • Any debit to an account on the books of a US financial institution of the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation; or
    • Any transaction prohibited by Executive Orders 14066 or 14068 – the sanctions authorities that prohibit certain imports, exports, and new investment involving Russia.
  • Russian Harmful Foreign Activities Sanctions Regulations General License 17A: General License 17 authorizes the importation into the United States of certain Russia-origin items otherwise prohibited by Executive Order 14068, pursuant to certain pre-existing written contracts, until March 25, 2022. Amended General License 17A extends the expiration date of the authorization with respect to Russian-origin fish, seafood, and preparations thereof, to June 23, 2022. It is important to note that the amended general license does not extend the authorization for importation of Russia-origin alcoholic beverages or non-industrial diamonds.
  • Russian Harmful Foreign Activities Sanctions Regulations General License 20: Authorizes US persons to engage in transactions related to the official business of third-country diplomatic or consular missions in Russia that would otherwise be prohibited by Executive Order 14024 or section 1(a)(iv) of Executive Order 14068, which prohibits direct or indirectly supply of US dollar-denominated banknotes to the Government of Russia, or any person located in Russia.
  • Executive Orders 13685 and 14065 General License 25: Authorizes transactions related to journalistic activities and establishment of news bureaus in the Crimea, the Donetsk People’s Republic, or Luhansk People’s Republic regions of Ukraine.
  • Updates to Frequently Asked Questions 1,023 and 1,024: Clarifies the extended June 23 expiration date of General License 17A with respect to the importation of Russian-origin fish, seafood, and preparations thereof.

Also, today OFAC announced its designation of “key enablers” of the Russian invasion of Ukraine. These designations include dozens of Russian defense companies, 328 members of the Russian State Duma, as well as the head of Sberbank, Russia’s largest financial institution. This action by OFAC brings US sanction more closely in line with measure taken by the EU, UK and Canada.

  • Russian Defense Companies: As part of this sanctions package, OFAC designated 48 companies that are part of Russia’s “defense-industrial base.” These designations include Tactical Missiles Corporation JSC (translated abbreviation as KTRV) as well as KTRV’s General Director Boris Viktorovich Obnosov and 28 entities that are part of KTRV’s structure; JSC NPO High Precision Systems (High Precision Systems); NPK Tekhmash OAO (Tekhmash); Joint Stock Company Russian Helicopters (Russian Helicopters) and 15 subsidiary entities; and Joint Stock Company Kronshtadt (Kronshtadt).
  • Russian Duma: Additionally, OFAC designated The State Duma of the Federal Assembly of the Russian Federation and 328 of its members for their support of President Putin’s invasion of Ukraine. OFAC noted such complicity included the ratification of treaties recognizing the so-called Donetsk People’s Republic and Luhansk People’s Republic. Today’s action supplements the March 11 designation of 12 members of the Russian State Duma who had advocated for Russia’s recognition of the breakaway Ukrainian regions.
  • Sberbank: Today, OFAC also designated Herman Gref, the head of Sberbank and a known ally of Putin.

In addition to the above sanctions, OFAC also confirmed it issued new guidance in the form of Frequently Asked Questions to clarify that “any transaction involving gold related to the Central Bank of the Russian Federation is covered by existing sanctions.”

See additional trackers for EUJapanRepublic of Korea and UK. Please contact us with any questions.