The Evolving Use of Sanctions
From the war in Ukraine to Afghanistan and Myanmar, learn about key regimes, geopolitical trends, and sanctions evasion risks.
Download nowOn September 30, 2022, President Vladimir Putin announced the attempted illegal annexation of the Ukrainian regions of Donetsk, Luhansk, Kherson, and Zaporizhzhia. In the wake of the announcement, the Council of the EU has announced the adoption of an eighth package of sanctions against Russia as “proof of our determination to stop Putin’s war machine.”
The package announced on October 6, 2022, includes economic and individual sanctions against Russia. According to the European Commission, the package was “closely coordinated with our international partners” and introduces new EU import bans worth €7 billion to limit Russia’s revenues.
The agreement also lays the groundwork for the required legal framework to implement a price cap on Russian oil. Proposed by the G7 in September 2022, these measures will prohibit the provision of brokering services or financial assistance related to the maritime transport of Russian crude oil or petroleum products. The Council notes that the price cap will both “drastically reduce the revenues Russia earns from oil” and stabilize global energy prices.
The EU’s new sanctions package also
According to the Council, existing and new restrictions will be applied to all Russian-occupied territories in Ukraine.
The UK’s response to the annexation also introduces new export bans on nearly 700 goods crucial to Russia’s industrial and technological capabilities. Additionally, the UK will prevent Russian access to:
As of September 29, 2022, the Governor of the Central Bank of the Russian Federation, Elvira Nabiullina, was also added to the UK sanctions list, subjecting them to a travel ban and asset freeze. The decision to designate Nabiullina is due to their involvement in steering the Russian economy through the Russian regime’s war against Ukraine and extending the ruble into the Ukrainian territories annexed by Russia.
Outside of Europe, further sanctions, travel restrictions, and financial penalties placed on Russian-backed separatists and senior officials have been imposed. On September 30, the US government announced the imposition of additional Russia sanctions, including the designation of 57 entities and visa restrictions on 910 individuals. On October 2, the Australian government introduced fresh sanctions on 28 Russian entities.
As western regimes grow and evolve, firms will need to closely watch developments and have access to data and systems that respond to changes with speed and agility.
To keep up with the evolving sanctions landscape, financial institutions must understand their risk environment and legal obligations. Compliance staff should ensure that the policies, procedures, and controls in place reflect those realities and have the flexibility to be updated as necessary. Sanctions regimes are constantly changing, and ensuring a firm takes an appropriate response is an ongoing responsibility.
From the war in Ukraine to Afghanistan and Myanmar, learn about key regimes, geopolitical trends, and sanctions evasion risks.
Download nowOriginally published 07 October 2022, updated 07 October 2022
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