New U.S., UK, and EU Designations: On September 30, 2022, the U.S. designated 295 individuals and entities. The new designations included 14 persons in Russia’s military industrial complex, including Sinno Electronics Co. and Taco LLC, Chinese and Armenian suppliers, for their support of a Russian defense procurement firm. The U.S. also targeted two Russian financial leaders who hold senior positions at the Central Bank of the Russian Federation, and a Russian Deputy Prime Minister. The Office of Foreign Assets Control (“OFAC”) also added 278 members of Russia’s legislature to the Specially Designated Nationals and Blocked Persons List (“SDN List”). The U.S. Department of State announced visa restrictions on 910 individuals, including members of the Russian and Belarusian military.
The UK designated the Governor of the Central Bank of Russia on September 30, 2022 and the head of the government of the Russian-occupied Kherson region on October 4, 2022.
On October 6, 2022, the EU designated 30 individuals and seven entities. The designations include individuals involved in the “illegal sham ‘referenda’,” Russian companies in the defense industry, and prominent Russian individuals spreading disinformation, among others. The EU also broadened the listing criteria on which future designations can be based to include and possibility target those who facilitate the circumvention of EU sanctions.
U.S. Sanctions Guidance Signals “More Aggressive” Approach: On September 30, 2022, OFAC published guidance stating that the U.S. is prepared to “more aggressively use its authorities” under existing sanctions to target those providing “material support” to Russia-related sanctioned persons or sanctioned activity. The guidance notes that OFAC has authority to target entities and individuals outside Russia that provide financial or other material support for Russia’s annexation of Ukraine.
U.S. Adds 57 Entities to Entity List and Publishes Additional Export Controls Guidance: Effective September 30, 2022, the U.S. Bureau of Industry and Security (“BIS”) added 57 entities to the Entity List for their support of the Russian military. One of the entities is located in Crimea, and the rest are in Russia. The entities were added for acquiring or attempting to acquire U.S.-origin items in support of Russia’s military, involvement in the development of quantum computing technologies, or supporting Russia’s development of advanced defense production and development capabilities.
BIS also issued new guidance clarifying that U.S. export controls on Russia can be applied to entities in third countries outside of Belarus or Russia that support Russia’s or Belarus’s military and industrial sectors, including backfilling technologies and other items prohibited by the U.S. and the 37 allies and partners that have implemented substantially similar controls.
EU Publishes Eighth Round of Sanctions: On October 6, 2022, the EU published a new package of sanctions that include a variety of measures. In particular, the EU:
- Oil Price Cap:Established the basis of an oil price cap by prohibiting the provision of maritime transport and technical assistance, brokering services, or financing or financial assistance related to the maritime transport of crude oil (as of December 2022) or petroleum products (as of February 2023) to third countries, which originates in or is exported from Russia, purchased above a to-be-determined price cap. The prohibition will apply from the date the EU Council decides to introduce the price cap.
- Import Ban: Extended the import ban on steel products that either originate in Russia or are exported from Russia. The EU imposed further import restrictions on wood pulp and paper, cigarettes, plastics and cosmetics, as well as elements used in the jewelry industry, such as precious stones and metals.
- Export Ban:Prohibited the sale, supply, transfer, or export of additional goods used in the aviation sector, electronic components, and specific chemicals. The EU also banned the sale, supply, transfer, or export of civilian firearms and their essential components and ammunition, military vehicles and equipment, paramilitary equipment, and spare parts to any person in Russia or for use in Russia.
- Prohibition on Holding Positions with Specific Russian Entities:Prevented EU nationals from holding any position on the governing bodies of certain Russian state-owned or controlled legal persons, entities, or bodies.
- Transaction Ban on Russian Maritime Shipping Register:Added the Russian Maritime Shipping Register to the list of state-owned entities that are subject to a transaction ban.
- Crypto Ban:Fully banned the provision of crypto-asset wallet, account, or custody services to Russian persons and residents, regardless of the total value of the crypto-assets (earlier EU sanctions limited crypto balances to 10,000 EUR) .
- Services Ban: Prohibited the provision of (1) architectural and engineering services; (2) legal advisory services; and (3) IT consultancy services to the Government of Russia or “legal persons, entities or bodies established in Russia.”
- Change to Geographical Scope of Restrictions:Extended the geographical scope of the February 23, 2022 restrictions, including the import ban on goods from the non-government controlled areas of the Donetsk and Luhansk, to also cover the non-controlled areas of Zaporizhzhia and Kherson.
UK Announces New Restrictions on Services and Exports: On September 30, 2022, the UK announced it will impose additional sanctions in response to Russia’s annexation of Ukraine. The additional measures have not been published, but the UK press release states it will include:
- Services: “Prevent[ing] Russian access to” (1) IT consultancy services, “including designing IT systems and software applications;” (2) architectural services; (3) engineering services; (4) advertising services; (5) transactional legal advisory services, which “will cover certain commercial and transactional services and hamper Russia’s businesses’ ability to operate internationally;” and (6) auditing services.
- Exports: Banning the export of “almost 700 goods” from the UK to Russia. The list is not defined, but is said to include “goods that are critical for production in Russia’s manufacturing sector.”
- Banks: For banks recognized under UK law and subject to UK sanctions, the UK will “suspend the process by which actions taken to manage the orderly failure [e.g., orderly wind-down] of” such banks.
- Russian Elites, Proxies, and Oligarchs (“REPO”) Task Force Deputies Meet: On September 30, 2022, REPO Task Force Deputies from Australia, Canada, the European Commission, France, Germany, Japan, Italy, the UK, and the U.S. met to discuss efforts to accelerate oligarch asset forfeiture efforts, including proposals to expand the ability to forfeit assets and the ability to enforce foreign forfeiture judgments in U.S. courts.
- UK Amends General License INT/2022/1280876: On October 6, 2022, the UK amended General License INT/2022/1280876 to include payments related to VTB-related insolvency proceedings under the German Banking Act. The license took effect on March 1, 2022 and expires on April 3, 2023.