Sanctions on Russia | Roundup - Financial Services - 4 April - 8 April

2022
This week has seen a significant amount of activity within the EU and UK due to the atrocities taking
place in Ukraine. Over 200 Russian diplomats have been expelled, NATO has agreed to supply
additional weapons to Ukraine, with the Czech Republic being the first EU country to supply tanks,
and several additional sanctions have been adopted.

This note sets out the sanctions adopted by the EU and UK during the week starting on 4 April 2022,
including a brief overview of the main points of discussion relating to the sanctions.

EU Sanctions
On 5 April the European Commission announced its fifth sanction package targeting Russia and
Belarus. Following prolonged discussions of the Permanent Representatives Committee II (COREPER
II) the sanction package was approved in the evening of 7 April, and subsequently formally adopted
by the European Council on 8 April and then published in the Official Journal of the EU (OJEU).

Based on the press release, the fifth sanction package contains the following measures.
• a prohibition to purchase, import or transfer coal and other solid fossil fuels into the EU if
they originate in Russia or are exported from Russia, as from August 2022
• prohibition to provide access to EU ports to vessels registered under the flag of Russia.
Derogations are granted for agricultural and food products, humanitarian aid, and energy.
• a ban on any Russian and Belarusian road transport
• export bans, targeting jet fuel and other goods such as quantum computers and advanced
semiconductors, high-end electronics, software, sensitive machinery and transportation
equipment
• import bans on products such as: wood, cement, fertilizers, seafood and liquor
• EU ban on participation of Russian companies in public procurement in member state.
• the exclusion of all financial support to Russian public bodies
• an extended prohibition on deposits to crypto-wallets, and on the sale of banknotes and
transferrable securities denominated in any official currencies of the EU member states to
Russia and Belarus, or to any natural or legal person, entity or body in Russia and Belarus
o It shall be prohibited to provide crypto-asset wallet, account, or custody services to
Russian nationals if the total value of crypto-assets of the natural or legal person,
entity or body per wallet, account or custody provider exceeds EUR 10 000.
• sanctions against individuals
• a transaction ban on 4 Russian banks already subject to a SWIFT ban, being an asset freeze.

You can find the press release here

The discussion on the fifth sanction package revolved around a number of issues. The first was on the
possible inclusion of oil, gas and coal sanctions in the fifth sanction package. Where sanctions targeting
gas were excluded relatively early on, a stronger push was seen regarding sanctions on oil. The initial
proposal of the European Commission from 5 April only contained a ban on Russian oil imports, explicit
reference was made to possible future oil related sanctions. EU High Representative for Foreign Affairs
Josep Borrell stated that the EU foreign ministers would discuss sanctions on oil would be discussed
coming Monday (11 April) during the Foreign Affairs Council.
The second was on the implementation period of the import ban for coal, with the initial proposal
calling for a 3-month grace period, and the final package containing a 4 month period. Importantly,
the sanction package does not contain any sanctions relating to oil and gas.

Third, a number of countries with an active shipping industry requested clarification on the scope of
the sanctions regarding shipping.

Amendments to existing sanctions

In addition, the EU has amended sanctions regulations published on 16 March (Sanctions Regulation
2022/428). The specific sanctions see to the provision of luxury goods to Russia, the amendment
introduces an exemption to allow the transfer of works of art between museums. This issue was raised
due to the Finnish customs authority seizing works of art returning from museums in Japan and Italy
to Russia.

You can find the press release here

UK Sanctions
On 8 April the UK, coordination with the US, has announced new sanctions that will target the
daughters of President Putin and his Foreign Minister Sergei Lavrov. Katerina Vladimirovna Tikhonova
and Maria Vladimirovna Vorontsova, the daughters of President Putin, and Yekaterina Sergeyevna
Vinokurova, daughter of Foreign Minister Sergey Lavrov, will be subject to travel bans and asset
freezes. This follows the UK’s sanctioning of Polina Kovaleva, Sergey Lavrov’s stepdaughter on 25
March.

Foreign Secretary Liz Truss said: “Our unprecedented package of sanctions is hitting the elite and their
families, while degrading the Russian economy on a scale Russia hasn’t seen since the fall of the Soviet
Union. But we need to do more. Through the G7, we are working with partners to end the use of
Russian energy and further hit Putin’s ability to fund his illegal and unjustified invasion of Ukraine.
Together, we are tightening the ratchet on Russia’s war machine, cutting off Putin’s sources of cash”.

On 6 April the Foreign Secretary has announced a new wave of UK sanctions on Russia following the
attacks on civilians in Ukraine. Sanctions include:
• Asset freezes against Sberbank and Credit Bank of Moscow. Sberbank is Russia’s largest bank
and this freeze is being taken in co-ordination with the US.
• An outright ban on all new outward investment to Russia.
• Ending UK dependency on Russian coal and oil by the end of 2022, and ending imports of gas
as soon as possible thereafter. From next week, the export of key oil refining equipment and
catalysts will also be banned
• Action against key Russian strategic industries and state owned enterprises. This includes a
ban on imports of iron and steel products.
• New restrictions on Russia’s ability to acquire the UK’s quantum and advanced material
technologies.
• And targeting a further eight oligarchs in key Russian strategic industries and state owned
enterprises. They include:
o Viatcheslav (Moshe) Kantor, the largest shareholder of fertilizer company Acron with
vital strategic significance for the Russian government
o Andrey Guryev - known close associate of Vladimir Putin and founder of PhosAgro - a
vital strategic company that produces fertilizers.
o Sergey Kogogin, director of Kamaz – manufacturer of trucks and buses, including for
the Russian military.
o Sergey Sergeyevich Ivanov, President of the world’s largest diamond producer Alrosa,
which the UK also sanctioned.
o Leonid Mikhelson, the founder, and CEO of leading Russian natural gas producer
Novatek, with a net worth of £18bn.
o Andrey Akimov, the CEO of Russia’s third largest bank Gazprombank.
o Aleksander Dyukov, the CEO of Russia’s third largest and majority state-owned oil
producer GazpromNeft.
o Boris Borisovich Rotenberg, son of the co-owner of Russia’s largest gas pipeline
producer SGM. The Rotenberg family are known for their close connections to Putin
and a number of them have already been sanctioned.