22nd October 2021

EU Extends Ukraine Sanctions Program

The European Council has imposed sanctions on eight Ukrainian law enforcement officials for enforcing Russian law against opponents of the annexation of Crimea and Sevastopol. The eight individuals include two judges, prosecutors, and security officers. 

The European Council says they have been “taking biased decisions in multiple politically motivated criminal proceedings or prosecuting pro-Ukrainian activists or intensifying the oppression campaign against opponents of the illegal annexation.”

All will have their assets frozen – including a prohibition on making funds available to them – and be banned from entering or transiting through the European Union (EU).

When asked about the EU’s decision to extend targeted sanctions against Russia, Foreign Ministry spokesperson Maria Zakharova replied: “Let me remind you about our fundamental position that is rooted in international law: Any decisions on sanctions bypassing the (United Nations) Security Council are illegitimate from the perspective of international law.”

While Russian President Vladimir Putin is now not expected to attend the G20 Summit in person this month – Reuters news agency says this is due to COVID-19 concerns – the timing of these new sanctions by the EU is notable.

The sanctions are part of a wider set of economic and restrictive measures that the EU has imposed against Russia since the annexation of Crimea and the city of Sevastopol in 2014. EU sanctions regarding the “territorial integrity of Ukraine” have now been applied to 185 people and 48 entities. Additional EU measures include economic sanctions targeting specific sectors of the Russian economy, currently in place until 31 January 2022. 

The EU has been careful to align its measures with those imposed by Ukraine’s National Security and Defense Council (NSDC). Earlier in October, the NSDC imposed new sanctions against 237 people involved in the organization of elections to the Russian Parliament in the occupied territories of Donbas and Crimea. 

International measures

The invasion of Crimea has generated a lot of international concern, with many countries imposing economic sanctions against Russian and Ukrainian targets, including individuals, officials and companies thought to be supporting the occupation.

The EU followed the US’s lead in 2014, issuing sanctions on businesses and individuals. Since then, hundreds of Ukrainian and Russian entities and individuals have been added to the sanctions program.

In response to sanctions by the EU and other countries, Vladimir Putin imposed a ban on imports of a number of food products from the European Union, Norway, the US, Australia, and Canada in 2014. This food embargo has been extended several times, with the most recent due to end in December 2021.

In 2020, the EU and the UK implemented sanctions against Russia for the poisoning and imprisonment of Russian opposition leader Alexei Navalny. The UK’s sanctions entailed asset freezes and travel bans against seven members of Russia’s government and its military and intelligence services.

In recent months, Ukraine has strengthened ties with China, signing an agreement to cooperate in building their respective infrastructure sectors. The president of Ukraine, Volodymyr Zelensky, has said that Ukraine might become a “bridge to Europe” for Chinese investments. Compliance teams should monitor this changing relationship and their exposure to Ukrainian and Chinese individuals and entities.

These latest additions to the EU’s sanctions list should also serve as a reminder to firms of the importance of screening customers against up-to-date sanctions lists to ensure they are tracking the latest developments. Regular risk assessments on higher risk markets such as Ukraine/Russia are also key to a proactive approach.

In order to ensure your firm does not violate international sanctions regulations, a robust sanctions screening solution should be combined with adverse media screening, as newly sanctioned people will likely have multiple bank accounts, possibly in other countries. 

Your screening solution should be regularly updated with the latest on sanctions relating to Ukraine, Crimea, and Russia, and be equipped to manage a number of unique challenges such as non-Western naming conventions, use of the Cyrillic alphabet, and the use of nicknames and aliases by targeted individuals.

Read more about global sanctions in our 2021 guide

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