Western nations levy new sanctions against Russia

Another 106 individuals and 88 entities were added to the EU sanctions list, which now exceeds the threshold of 2,000 listings.

The EU’s 13th sanctions package is geared towards countering circumvention tactics. The sanctions aim to impede Russia's acquisition of sensitive Western technologies for military purposes. Drones have been central to Russia's war against Ukraine. Against this background, the new EU sanctions specifically list companies procuring Russia with key drone components and introduces some sectoral sanctions to close loopholes and make drone warfare more complicated. The package adds 27 Russian and third country companies – from India, Sri Lanka, China, Serbia, Kazakhstan, Thailand and Turkey – to the list of entities associated to Russia's military-industrial complex. These entities are now subject to severe export restrictions regarding dual-use goods and technology, as well as goods and technology which might contribute to the technological enhancement of Russia's defence and security sector.

The EU has added the UK its list of partner countries for iron and steel imports. These partner countries apply a set of restrictive measures on imports of iron and steel and a set of import control measures that are substantially equivalent to those in the EU Regulation (EU) No 833/2014. This provides some relief for business, because no proof of the country of origin of the iron and steel inputs used for processing is required for imports from the UK.

Sanctions expert Andreas Haak of Pinsent Masons said: “Further EU restrictions cannot be ruled out and the UK is expected to continue lobbying the EU to stop importing Russian LNG amid concerns the gas could end up in the UK.  In January 2023, the UK imposed restrictions on dealings with Russian origin / located where it was intended to enter the UK”.

Separately, the UK has updated its own sanctions against Russia.

“Aligned with the European approach, the UK has targeted those outside of Russia that have been involved in manufacturing, and supplying goods used in the Russian defence sector contrary to spirit of the sanctions restrictions,” said Stacy Keen, sanctions expert at Pinsent Masons. “This comes at a time when the UK has published its UK sanctions strategy with an emphasis on ‘deter, disrupt and demonstrate’, where tackling Russia’s routes to try and bypass sanctions via non-aligned countries is a priority”.

“Third country supply and assistance to Russia is a focus area for UK government as is circumvention. Spikes in trade of goods falling within the scope of the Russian sanctions – which are vast – should be monitored, particularly where the trade is linked to countries that are aligned with Russia or do not impose sanctions against Russia,” she said.

Sanctions expert Barbara Thiemann of Pinsent Masons said: “Businesses should heighten their vigilance regarding potential sanctions circumvention risks and tailor their due diligence practices accordingly.”