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New Sanctions Regime against Russia

New Sanctions Regime against Russia

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In view of the gravity of the current situation in Ukraine, the EU has introduced further restrictive measures related to Russia's finance, defence, energy, aviation, and space sectors. This Legal Insight will give you a brief overview of the sanctions regime as of 27 February 2022.

The goods-related sanctions prohibit the sale, supply, transfer, or export of:

  • military goods and related material (subject to the grandfathering of contracts concluded before 1 August 2014) from the EU into Russia and vice versa;
  • dual-use goods and technologies within the meaning of the EU-Dual-Use-Regulation to Russian military end users;
  • goods that are not listed in the EU-Dual-Use-Regulation but will have a military end-use in Russia;
  • goods and technologies which might contribute to Russia’s technological enhancement of its defence and security sector (as listed in Annex VII (EU) No 833/2014);
  • goods and technologies for use in oil refining (as listed in Annex X (EU) No 833/2014); and
  • goods and technology suited for use in aviation and the space industry with or without origin in the EU (as listed in Annex XI (EU) No 833/2014).

Further, the Regulation prohibits certain ancillary services in relation to the aforementioned (including direct or indirect financial or technical assistance in relation to goods that are objects of sanctions). However, it does provide for various exceptions most importantly for contracts concluded before 26 February 2022, or ancillary contracts necessary for the execution of such contracts. Please contact any member of the Schoenherr team for a detailed assessment.

Sanctions relating to the capital market

  • The restriction of access to the capital markets for Russian state banks as defined in Annex III and VII of (EU) No 833/2014, as well as other major Russian institutions as defined in Annex III and VII of (EU) No 833/2014, including their subsidiaries established outside the EU and other entities acting on behalf or at the direction of such institutions.

  • Prohibitions are set out in terms of purchasing, selling, providing brokering or other assistance in the issuance of or otherwise dealing in debt or equity securities or money market instruments:

    • with a tenor exceeding 90 days, in each case if issued after 1 August 2014 to 12 September 2014; or

    • with a maturity exceeding 30 days, issued after 12 September 2014 to 12 April 2022; or

    • any transferable securities and money market instruments issued after 12 April 2022.

  • The prohibition of the listing and provision of services in relation to shares of Russian state-owned entities as defined in VI of (EU) No 833/2014 on Union trading venues.

  • The prohibition of any new loans or credit to any legal person, entity or body referred to in Annex III, V, VI, XII, XIII of (EU) No 833/2014 as of 26 February 2022. The prohibition does not apply to loans or credit specifically and demonstrably intended to finance non-prohibited imports or exports of goods and non-financial services between the Union and a third country, including Russia.

The sanctions regime further includes the following sanctions targeting individual assets, most importantly:

  • the freezing of funds owned or held by any designated person as defined in Annex I of (EU) No 269/2014 and Annex to Decision 2014/145/CFSP. The freezing of funds includes a prohibition of making funds or economic resources available to designated persons and entities. This applies also indirectly, e.g. non-designated entities may be subject to such a freeze in the event that they are held or "controlled" by a designated person. As to the proper procedure for determining whether an entity is "controlled" or not, available guidance is unclear. Parameters to be taken into account include, inter alia, whether the designated individual has a majority of voting rights, the right to appoint or remove a majority of the entity's board, or other rights to exercise dominant influence;
  • the prohibition of the acceptance of deposits exceeding certain values from Russian nationals or residents, the holding of accounts of Russian clients by Union central securities depositories, as well as the selling of euro-denominated securities to Russian clients.

Other sanctions regimes include restrictions on economic relations with Crimea, Sevastopol, Donetsk and Luhansk, including an import ban on goods, restrictions on trade and investment related to certain economic sectors a prohibition on supplying tourism services as well as an export ban on certain goods and technologies. For details see (EU) 2022/263 and (EU) No 692/2014.

In addition, the decision to exclude Russian banks from the SWIFT ("Society for Worldwide Interbank Financial Telecommunication international payment services") was agreed to on 27 February 2022 and will be published later today. We will keep you updated in this regard.


Violations of any of the mentioned EC sanctions regimes may constitute a criminal offence. In Austria, such violations are punishable with imprisonment of up to two years.


These prohibitions apply not only within the territory of the EU, it's vessels and aircrafts, but also to EU incorporated businesses and nationals of EU Member States, as well as generally in respect of any business done within the EU.

By Klara Kiehl, Counsel, and Katharina Mydza, Associate, Schoenherr

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