Inaugural Edition | May 2024

Inaugural Edition | May 2024


Welcome to This Month in EU Sanctions!

New EU Sanctions

Russia

  • New sanctions program: On 27 May 2024, the Council of the European Union adopted of a new legal framework allowing sanctions for serious human rights violations or abuses, repression of civil society and democratic opposition, and undermining democracy and the rule of law in Russia. The program also introduces trade controls on exporting equipment that might be used for internal repression, as well as on equipment, technology or software intended primarily for use in information security and the monitoring or interception of telecommunication. Read more.
  • Use of windfall profits generated by frozen Russian sovereign assets: On 21 May 2024, the Council adopted a set of legal acts ensuring that the net profits stemming from unexpected and extraordinary revenues accruing to central securities depositories (CSDs) in the EU, as a result of the implementation of EU sanctions, will be used for further military support to Ukraine, as well as its defense industry capacities and reconstruction. Read more.
  • Disinformation and interference: On 17 May 2024, the Council decided to suspend the broadcasting activities in the EU of four additional media outlets, which spread and support the Russian propaganda and war of aggression against Ukraine. Read more. On 27 May 2024, the Council sanctioned two individuals and one entity responsible for conducting propaganda actions targeted at civil society in the EU and its neighboring countries, gravely distorting and manipulating facts in order to justify and support Russia's war of aggression against Ukraine. Read more.

Other Sanctions Programs

  • Iran: On 31 May 2024, the Council sanctioned six individuals and three entities for their role in the transfer of unmanned aerial vehicles (UAVs) to Russia in support of its war of aggression against Ukraine; the transfer of UAVs or missiles to armed groups and entities undermining peace and security in the Middle East and the Red Sea region; or for being involved in Iran’s UAV program. Read more.
  • North Korea: On 31 May 2024, the Council sanctioned six individuals and three entities in view of sanctions evasion activities carried out by the Democratic People’s Republic of Korea’s (DPRK) that could generate funds for its illegal nuclear and ballistic missile programs, in violation of and with flagrant disregard for the relevant UN Security Council resolutions, and in view of the military support given by the DPRK to Russia’s war of aggression against Ukraine. Read more.
  • Syria: On 28 May 2024, the Council extended EU sanctions. against the Syrian regime for an additional year, until 1 June 2025, removed six listings, and prolonged the application of the existing humanitarian exemption. Read more.
  • Iran: On 14 May 2024, the Council broadened the scope of the EU sanctions program s in view of Iran’s military support of Russia’s war of aggression against Ukraine. The EU is now able to impose sanctions for supplying, selling or otherwise being involved in transferring Iran’s missiles and UAVs: (i) in support of Russia’s war of aggression against Ukraine; (ii) used by armed groups and entities to undermine peace and security in the Middle-East and the Red Sea region, or (iii) in breach of United Nations Security Council Resolution 2216 (2015). Read more.

G7 Update

G7 Finance Ministers and Central Bank Governors met on 23-25 May 2024 in Stresa, Italy and issued a joint communiqué which noted, concerning sanctions, in relevant parts (emphasis added):

We will respond robustly to price cap violations, including by sanctioning those engaged in deceptive practices while transporting Russian oil and taking action against the networks Russia has developed to extract additional revenues from evasion. We are also committed to further financial and economic sanctions to reduce Russia’s sources of revenue and capacity to wage war against Ukraine, including continuing to target Russia’s energy revenue and future extractive capabilities. We will counter attempts to evade or circumvent sanctions, including through facilitation of Russia’s defence industry procurement efforts by financial institutions. Financial institutions and other entities that facilitate Russia’s acquisition of items or equipment for its defence industrial base are supporting actions that undermine the territorial integrity, sovereignty, and independence of Ukraine. Where appropriate, we stand ready to impose sanctions on individuals and entities that help Russia acquire advanced materials, technology, and equipment for its military industrial base. We are also re-doubling our domestic efforts to make sure that companies and financial institutions in G7 countries are not party to Russia’s circumvention schemes. We strongly condemn the increasing military cooperation between North Korea and Russia, in direct violation of relevant UNSCRs. We call upon Iran to stop assisting the Russian military and its war on Ukraine. We express our concern about transfers to Russia from firms around the world, including those in China, of dual-use materials and components for weapons and equipment for military production.

Relatedly, the European Central Bank reportedly pressured banks to speed up Russia to exist on fear of U.S action (17 May 2024). See also: G7 to target banks helping Russia evade Ukraine war sanctions (31 May 2024).


Compliance & Enforcement

New FAQs Released

On 17 May 2024, the European Commission published an EU Compliance Alert on the "Russian Oil Price Cap". It released updated FAQs on Media on 14 May 2024. The latest version of the Consolidated FAQs is dated 14 May 2024.

NCA Guidance

The national competent authorities of Italy and Germany respectively released guidance on Article 5n of Council Regulation (EU) No?833/2014 and the potential liability of parent companies for the actions of their non-EU subsidiaries.

Poland and Finland Join the Baltic Customs Initiative

On 26 January 2024, the Heads of customs authorities of Lithuania, Latvia and Estonia approved the Baltic region’s agreement on uniform sanctions control measures in Estonia, Latvia and Lithuania. on 9 May 2024, this regional agreement was further expanded. Read more.

French Anti-circumvention Action

On 30 May 2024, French customs announced that following a 10-months investigations, it had taken a series of actions against a company operating a Russia sanctions circumvention scheme.


Meanwhile before EU Courts

In May 2024, the General Court of the Court of Justice of the European Union rendered six judgments in the area of EU sanctions in relation to the Russia, Belarus and Syria sanctions programs.

On 22 May 2024, Global 8 Airlines brought an action against the European Commission seeking to annul the Commission's decision to include two aircraft in the list subject to grounding ban under Council Regulation (EU) No?833/2014. See Case T-277/23.


Export Controls & Other Economic Security News

  • On 30 May 2024, the Council adopted Conclusions on the White Paper on Export Controls. The feedback period on the White Paper on Export Controls closed on 30 April 2024. The Commission received 23 contributions.
  • On 8 May 2024, the European Investment Bank (EIB) approved an updated definition of dual-use goods and infrastructure eligible for EIB Group financing and agreed to facilitate financing for small and medium-sized enterprises (SMEs) in the security and defense industry, by opening up dedicated intermediated financing. Read more.
  • On 7 May 2024, the Expert Group on Outbound Investment met with the fifth time. The group was created in July 2023 to advise the Commission in examining security risks from the outbound investments. The group seeks to identify the types of transactions, sensitive emerging technologies, dual-use items, and destinations of concern that operate civil-military fusion strategies, including by sharing and analyzing transaction-specific information. Read more.
  • On 23 May 2024, the Council adopted a recommendation on enhancing research security. The main objective of the recommendation is to support the Commission and member states to address research security risks deriving from international cooperation. The recommendation identifies risks relating mainly to the areas of undesirable transfer of knowledge, foreign interference, and ethical or integrity violation. Read more.


Looking Ahead

The Road to the 14th Package

The EU is preparing a 14th package of sanctions against Russia.? Here is a selection of articles covering the discussions.

New Sanctions Programs?

Other sanctions actions are also reportedly under consideration. Here is a selection of press reports on these discussions:

Agenda

  • 13-14 June 2024: G7 Summit
  • 24 June 2024: Foreign Affairs Council
  • 27-28 June 2024: European Council

Ana Caprile

European Parliament Research Service

5 个月

Thank you Jan Dunin-Wasowicz for this useful recap. Extremely useful for the work we do in the European Parliamentary Research Service

Mikhail Bychikhin, FCIArb

Sanctions and International Disputes (Arbitration & Litigation) Counsel at Curtis, Mallet-Prevost, Colt & Mosle LLP

5 个月

Thanks for sharing Jan Dunin-Wasowicz, really helpful!

Ma?gorzata Lewandowska

Commercial lawyer I Business advisor I 15+ years of practice in advising clients on doing business in Poland I Corpo/Commercial I M&A I HR I Data privacy I Partner at LEGALIO | Pietrzak Markowicz Lewandowska Luba? sp.j.

5 个月

Jan Dunin-Wasowicz, many thanks for sharing and valuable insight!

回复
Daniel Schick

Exportkontrollbeauftragter bei PVA TePla AG / Export Control Officer

6 个月

Great work and thanks for sharing!

回复
Michael Huneke

Co-Chair of the Sanctions, Export Controls, and AML Practice Group; Partner at Hughes Hubbard & Reed LLP

6 个月

Great work!

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