EU’s 11th Package of Sanctions against Russia: Expanded measures and countermeasures
On 23 June 2023, the European Union (EU) implemented its eleventh package of sanctions against Russia's aggression on Ukraine.
This package comprised:
- Council Regulation (EU) 2023/1214 amending Council Regulation 833/2014, covering the EU’s sectoral sanctions on Russia;
- Council Regulation (EU) 2023/1215 amending Council Regulation 269/2014 (Regulation 269), covering the EU’s asset freeze regime on Russia; and
- Council Implementing Regulation 2023/1216 added more individuals and entities to the asset freeze lists under Regulation 269.
In broad terms, the 11th package aims to intensify existing measures and counteract attempts to bypass or circumvent them, ultimately intending to weaken Russia’s war efforts and financial resources. Of particular interest is the focus of the new package on expanding on the concept of sanctions circumvention.
The 11th package includes among others, the following key measures:
Trade / sectoral restrictions
- For export control purposes, the European Council has added 87 new entities to the list directly supporting Russia’s military and industrial complex in its war of aggression against Ukraine.
- To combat sanctions circumvention, the EU plans to enhance cooperation with third countries and provide technical help. In cases where circumvention persists, the EU may resort to exceptional measures, such as restricting the sale of goods and technology to third countries at high risk of being used for circumvention.
- The prohibition on providing transferable securities to financial instruments denominated in any currency has been extended (Article 5f prohibition).
- The European Council has extended the deadline for applying a temporary derogation from the prohibition on the provision of several services/activities which are otherwise restricted, intending further to facilitate divestment from the Russian market by Union operators.
- In connection with this, a parallel derogation has been introduced, allowing competent authorities to authorise the provision of legal advisory services until 31 March 2024, which are legally required for the completion of a sale or transfer of proprietary rights directly or indirectly owned by legal persons, entities or bodies established in Russia in a legal person, entity or body appointed in the Union.’
- To minimise the risk of sanctions evasion, the EU has imposed a transit ban on goods and technology that could contribute to Russia’s military and technological advancements. The ban includes items related to the aviation and space industries and jet fuel and fuel additives exported from the EU to third countries.
- In response to Russia’s media manipulation and distortion of facts, the EU has extended the suspension of broadcasting licences to five additional media outlets: RT Balkan, Oriental Review, Tsargrad, New Eastern Outlook, and Katehon.
- The EU has imposed restrictions on road transport by prohibiting the entry of goods transported by trailers and semi-trailers registered in Russia. In light of deceptive practices in the shipping industry, vessels suspected of breaching bans on importing Russian crude oil and petroleum products or tampering with their navigation systems will be denied access to EU ports and locks.
Asset freeze restrictions
- Restrictive measures have been imposed on 71 additional individuals and 33 entities involved in actions that undermine Ukraine’s territorial integrity and independence.
- The European Council has amended the existing listing criterion regarding the circumvention of EU sanctions, or significant frustration of EU sanctions by third-country operators, including instances where the main activity of a third-country operator consists of purchasing restricted goods in the EU that reach Russia, the involvement of Russian individuals or entities, the recent creation of a company for purposes related to prohibited goods reaching Russia, or a drastic increase in the turnover of a third country operator involved in such activities.
- Further derogations from the asset freeze have been introduced to allow for divestment from Russian companies and the disposal of certain types of securities, such as global and American depositary receipts held with VTB Bank and Russia’s National Settlement Depository (NSD).
- The EU has introduced a derogation allowing the release of frozen funds belonging to Alexey Alexandrovits Mordashov after having determined that such funds are necessary for the completion of specific transactions, including sales, which are strictly necessary for the wind-down, by 31 August 2023, of a joint venture or similar legal arrangement established in Russia with this natural person or an entity owned by Mr Mordashov before 28 February 2022.
The EU also reiterated that it remained committed to maintaining and increasing collective pressure on Russia through possible further restrictive measures. It remains steadfast in its support for Ukraine and will continue to provide political, economic, military, financial, and humanitarian help for as long as necessary.
The legal acts related to this latest package of sanctions have been published in the Official Journal of the EU and can be found here.
The European Commission’s press release can be found here.
Our updated table listing the various measures adopted under the successive packages of EU sanctions on Russia can be found here.