The Council of the European Union today adopted a 14th package of economic and individual restrictive measures against Russia, “dealing a further blow to Putin’s regime and those who perpetuate his illegal, unprovoked and unjustified war of aggression against Ukraine”.
These measures are designed to target high-value sectors of the Russian economy, like energy, finance and trade, and make it ever more difficult to circumvent EU sanctions.
EU High Representative Josep Borrell said the latest package demonstrated the EU’s unity in supporting Ukraine: “Our sanctions have already significantly weakened the Russian economy and prevented Putin from accomplishing his plans to destroy Ukraine, although he still continues the illegal aggression targeting civilians and civilian infrastructure.”
Today’s package includes restrictive measures on an additional 116 individuals and entities responsible for actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine. It also contains the following sectoral measures:
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Energy
To ensure that EU facilities are not used to tranship Russian liquified natural gas (LNG) to third countries, and thereby reduce the significant revenues that Russia derives from LNG sale and transport, the EU will forbid reloading services of Russian LNG in EU territory for the purpose of transshipment operations to third countries. This covers both ship-to-ship transfers and ship-to-shore transfers, as well as re-loading operations, and does not affect import but only re-export to third countries via the EU.
The EU will prohibit new investments, as well as the provision of goods, technology and services for the completion of LNG projects under construction, such as Arctic LNG 2 and Murmansk LNG. Import restrictions are introduced on Russian LNG through EU terminals not connected to the natural gas system.
Anti-circumvention
EU parent companies will be required to undertake their best efforts to ensure that their third-country subsidiaries do not take part in any activities resulting in an outcome that the sanctions seek to prevent.
EU operators selling battlefield goods to third countries will need to implement due diligence mechanisms capable of identifying and assessing risks of re-exportation to Russia, and mitigating them.
In addition, EU operators transferring industrial know-how for the production of battlefield goods to third-country commercial counterparts will now have to include contractual provisions to ensure that such know-how will not be used for goods intended for Russia.
Finance
The Council decided to outlaw the use of the ‘System for Transfer of Financial Messages’ (SPFS), a specialised financial messaging service developed by the Central Bank of Russia to neutralise the effect of restrictive measures. EU entities operating outside Russia will be forbidden from connecting to the SPFS or equivalent specialised financial messaging services.
In addition, EU operators will be barred from making transactions with specifically listed entities using SPFS outside of Russia.
The Council is introducing a ban on transactions with targeted credit and financial institutions and crypto assets providers established outside of the EU, when these entities facilitate transactions that support Russia’s defence-industrial base through the export, supply, sale, transfer or transport towards Russia of dual-use goods and technology, sensitive items, battlefield goods, firearms and ammunition.
Funding of political parties and other organisations
The Council decided that political parties and foundations, non-governmental organisations, including think tanks, or media service providers in the EU, will no longer be allowed to accept funding coming from the Russian state and its proxies.
Transport
For the first time, the EU has adopted a measure targeting specific vessels contributing to Russia’s warfare against Ukraine, which are subject to a port access ban and ban on provision of services. These vessels can be designated for various reasons such as the transport of military equipment for Russia, the transport of stolen Ukrainian grain, and support in the development of Russia’s energy sector, for instance through the transport of LNG components or transshipments of LNG. This measure also targets tankers that are part of Putin’s dark fleet which circumvent the EU and Price Cap Coalition’s caps, while adopting deceptive shipping practices in complete disregard of international standards. 27 vessels were targeted today on these grounds.
The EU widens its flight ban. The prohibition to land in, take off from or overfly the territory of the EU will also apply to any aircraft used for a non-scheduled flight, and where a Russian natural or legal person, entity or body, is in a position to effectively determine the place or time for its take-off or landing to reach, for instance, a holiday destination or a business meeting. Furthermore, operators must provide any information requested by member states’ national competent authorities about non-scheduled flights, including ownership of the aircraft and possibly passengers.
The EU also broadens the prohibition on the transport of goods by road within the territory of the EU, including in transit, so as to cover EU operators which are owned 25% or more by a Russian natural or legal person.
Import-export controls and restrictions
The Council added 61 new entities to the list of those directly supporting Russia’s military and industrial complex in its war of aggression against Ukraine. They will be subject to tighter export restrictions concerning dual use goods and technologies, as well as goods and technology which might contribute to the technological enhancement of Russia’s defence and security sector. Some of these entities are located in third countries (China, Kazakhstan, Kyrgyzstan, Türkiye, and the United Arab Emirates) and have been involved in the circumvention of trade restrictions and engaged in the procurement of sensitive items used for example in the production of drones, or providing material support for Russian military operations.
The EU also introduced further restrictions on exports of goods which contribute in particular to the enhancement of Russian industrial capabilities (e.g. chemicals, including manganese ores and compounds of rare-earths, plastics, excavating machinery, monitors and electrical equipment), as well as further restrictions on the import of helium from Russia, which is a source of significant revenues for the regime.
Other measures
The package imposes restrictions on accepting applications for registrations in the EU of certain intellectual property rights by Russian nationals and companies.
Lastly, it will be forbidden to purchase, import, transfer or export Ukrainian cultural property goods and other goods of archaeological, historical, cultural, rare scientific or religious importance, where there are reasonable grounds to suspect that the goods have been unlawfully removed from Ukraine.
