Since early 2014 the EU has imposed various sanctions with regard to Russia in connection with the situation in the Ukraine and the Crimea through a raft of different measures which have undergone expansion and renewal – we reported on the most recent extension (measures against the Russian financial, energy and defence sectors, and, dual-use goods) in July 2016 here.
Under recently adopted legislation, in view of the continuing undermining or threatening of the territorial integrity, sovereignty and independence of the Ukraine the EU has extended and updated certain sanctions against Russia consisting of an asset freeze and a travel ban against 146 persons and 37 entities for another six months, i.e until 15 March 2017.
Some Russian businesses are challenging the EU sanctions regime and have accordingly lodged cases with the European Court of Justice, including a judicial review matter brought by Rosneft challenging the validity of certain of the EU sanctions rules (as implemented in the UK) that the European Court’s Advocate General gave his official Opinion about in May 2016, which can be found here – a ruling might be expected by the end of this year.
The application of the EU sanctions regime in the UK is not affected by the outcome of the UK’s Brexit referendum, for the moment at least.
Although both these particular sanctions and other sanctions against Russia (and the Ukraine) have been in place for some time, it is never too late to for a business to do a compliance exposure check by undertaking the following:
- A due diligence screening against individuals and entities on the sanctions lists to ensure that the business is not doing business with any of these;
- A contracts clauses check on relevant contracts to ensure that provisions concerning warranties, force majeure, termination, and, liability are all up to scratch as regards sanctions; and,
- Where possible and of use (either as an alternative or a complement to contract breach risk), obtain insurance (export credit, political risk, and, trade disruption) against sanctions risks.
For a summary of the current EU sanctions regime overall with regard to Russia and the Ukraine please look here.
André Bywater is a commercial lawyer with Cordery in London where he focuses on regulatory compliance, processes and investigations.
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