The EU has recently announced an extension of its sanctions imposed in response to the situation in Ukraine. EU leaders had previously confirmed that the duration of sanctions affecting Russia would be linked to the implementation of the Minsk Agreements, currently foreseen to be completed by 31 December 2015. The EU has therefore taken steps to extend the validity of its sanctions against Russia beyond this period; the underlying Council Decisions would otherwise have expired before the Minsk Agreements are expected to be fully implemented.
This briefing provides a summary of the new EU legislation and the revised expiry dates of the various measures. There have been no substantive changes to the restrictive measures and EU persons should therefore continue to comply with all applicable measures.
Sanctions relating to Crimea and Sevastopol
Council Decision (CFSP) 2015/959 amended the date of expiration for the EU sanctions relating to Crimea and Sevastopol with effect from 21 June. Council Decision 2014/386/CFSP (which originally introduced these sanctions) was previously stated to be in force until 23 June 2015. The measures will now apply until 23 June 2016.
The Crimea/Sevastopol sanctions include prohibitions on:
- the import into the EU of goods originating in Crimea or Sevastopol;
- the acquisition of real estate or ownership of an entity in the region;
- the granting of any credit to an entity or the creation of a joint venture in the region;
- the sale or supply of listed goods used in certain key sectors; and
- the provision of services related to tourism.
Sectoral sanctions affecting Russia
Council Decision (CFSP) 2015/971 extends the validity of the EU’s sectoral sanctions against Russia introduced by Council Decision 2014/512/CFSP (as amended). By way of reminder, these measures include restrictions on:
- dealing with certain “transferable securities and money market instruments” issued by listed Russian entities;
- lending to listed Russian entities;
- the sale or supply of certain equipment used in the oil and gas industry, where that equipment is destined for particular projects;
- the provision of “associated services” to certain oil exploration projects; and
- the sale or supply of military/dual use goods; and
- restrictions associated with the supply of certain services relating to the types of equipment and goods referred to above.
These measures were originally due to expire on 31 July 2015. The new Decision became effective on 23 June and extends the period of application of these sanctions to 31 January 2016. The EU has released a statement on this extension.
The remaining EU measures introduced in response to the situation in Ukraine comprise an asset freeze against two sets of individual/entities: (i) those said to be responsible for the misappropriation of Ukrainian state funds and human rights violations in Ukraine (imposed by Council Decision 2014/119/CFSP (as amended)); and (ii) those said to be responsible for actions which undermine or threaten the territorial integrity, sovereignty and independence of Ukraine (imposed by Council Decision 2014/145/CFSP (as amended)). In relation to (i), the Council Decision provides for the asset freeze to remain in place until 6 March 2016 (and 6 October 2015 in respect of one person). The measures in relation to (ii) currently apply until 15 September 2015.
For further information, please contact Susannah Cogman, Partner, Daniel Hudson, Partner, Elizabeth Head, Senior Associate or your usual Herbert Smith Freehills contact.