Vedder Price

On February 23, the EU adopted its first wave of measures in response to “Russia's unprecedented and unprovoked military aggression of Ukraine.”[1]  The various sanctions were introduced under the following instruments: 

• Council Regulation (EU) 2022/259:[2]  amends Article 6b to introduce a derogation to allow for the release of funds for the termination of contracts by  August 24, 2022.
• Council Implementing Regulation (EU) 2022/260:[3]  adds 22 people and four entities to the asset freeze list.
• Council Implementing Regulation (EU) 2022/261:[4]  adds the 336 members of the Russian State Duma to the asset freeze list.
• Council Regulation (EU) 2022/262:[5]  prohibits dealing with transferable securities and money-market instruments issued after March 9, 2022 by the Russian government or the Central Bank of Russia (or any entity acting on their behalf) or making loans or credit available to such entities.
• Council Regulation (EU) 2022/263[6]  relating to the non-government controlled areas of the Donetsk and Luhansk oblasts of Ukraine: imposes an import ban on all goods from the regions into the EU and a prohibition on financing; restricts certain investments in the regions; restricts trade and investment; prohibits the supply of tourism services; bans exports on specified goods and technologies; and prohibits certain services in the transport, telecommunications, energy or oil, gas and mineral sectors.

The EU responded to the February 24 invasion with all 27 member states voting to impose “sanctions against President Putin and Foreign Minister Lavrov and adopt wide ranging individual and economic sanctions.”[7]  The following measures were imposed:

• Council Regulation (EU) 2022/328:[8]  extends financial restrictions by prohibiting the listing of Russian state-owned entities in the EU and limiting the value of deposits made by Russian nationals in the EU; introduces an export ban on goods and technologies in the oil refining, aviation and space sectors; prohibits insurance, financial and technical services relating to goods and services in the aviation and space sectors; and imposes a restriction on exports of dual-use items and technology. 
• The Regulations provide that: “It shall be prohibited to sell, supply, transfer or export, directly or indirectly, goods and technology suited for use in aviation or the space industry, as listed in Annex XI, whether or not originating in the Union, to any natural or legal person, entity or body in Russia or for use in Russia.”  Annex XI comprises “Aircraft, spacecraft, and parts thereof.”  There is a grace period until March 28 to unwind such arrangements.
• The new measures also ban the export of items going far beyond the Dual-Use List.  A new Annex VII has been inserted into the existing Regulations which is extremely extensive and restricts a wide variety of goods relating to electronics, computers, telecommunications, information security, sensors and lasers, navigation and avionics, marine, and aerospace and propulsion.[9]  
• Council Regulation (EU) 2022/330:[10]  broadens the asset freeze listing criteria.
• Council Regulation Implementing (EU) 2022/332:[11]  designates 98 individuals and entities, including the Russian President and Minister of Foreign Affairs, members of the National Security Council and the remaining members of the Russian State Duma.

The EU also amended its sanctions on Belarus on February 18[12]  and February 24[13]  which extended the existing sanctions package until February 28, 2023.  It is thought that the EU will impose further sanctions on Belarus in relation to their assistance to Russia. 

On February 26, the leaders of the UK, the EU, France, Germany, Italy, Canada and the United States released a joint statement[14]  committing to the introduction of additional restrictive measures including (a) removing certain Russian banks from the SWIFT messaging system, (b) imposing restrictive measures on the Russian Central Bank to prevent it from undermining sanctions, (c) placing restrictions on wealthy Russians gaining access to the financial systems of the allies, and (d) launching a transatlantic task force to ensure that sanctions are effectively implemented and enforced. 

As at the time of writing, further details, including identification of the banks that will be banned from SWIFT, have not yet been released. 

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[1] See Press Statement of President Charles Michel of the European Council and President Ursula von der Leyen of the European Commission: Press statement of President Charles Michel of the European Council and President Ursula von der Leyen of the European Commission on Russia's unprecedented and unprovoked military aggression of Ukraine - Consilium (europa.eu)

[2] February 23, 2022 amending Regulation (EU) No 269/2014: EUR-Lex - 32022R0259 - EN - EUR-Lex (europa.eu)

[3] February 23, 2022 implementing Regulation (EU) No 269/2014: EUR-Lex - 32022R0260 - EN - EUR-Lex (europa.eu)

[4] February 23, 2022 implementing Regulation (EU) No 269/2014: EUR-Lex - 32022R0261 - EN - EUR-Lex (europa.eu)

[5] February 23, 2022 amending Regulation (EU) No 833/2014: EUR-Lex - 32022R0262 - EN - EUR-Lex (europa.eu)

[6] February 23, 2022 in response to the recognition of the non-government controlled areas of the Donetsk and Luhansk oblasts of Ukraine: EUR-Lex - 32022R0263 - EN - EUR-Lex (europa.eu)

[7] Council of the EU Press Release: Russia’s military aggression against Ukraine: EU imposes sanctions against President Putin and Foreign Minister Lavrov and adopts wide ranging individual and economic sanctions - Consilium (europa.eu)

[8] February 25, 2022 amending Regulation (EU) No 833/2014: EUR-Lex - 32022R0328 - EN - EUR-Lex (europa.eu)

[9] See Regulation (EU) No 833/2014 (as amended) Article 2a, Article 2b and Annex VII. 

[10]  February 25, 2022 amending Regulation (EU) No 269/2014: EUR-Lex - 32022R0330 - EN - EUR-Lex (europa.eu)

[11] February 25, 2022 implementing Regulation (EU) No 269/2014: EUR-Lex - 32022R0332 - EN - EUR-Lex (europa.eu)

[12] Council Regulation (EU) 2022/212: EUR-Lex - 32022R0212 - EN - EUR-Lex (europa.eu)

[13] Council Implementing Regulation (EU) 2022/300: EUR-Lex - 32022R0300 - EN - EUR-Lex (europa.eu)

[14] UK: Joint Statement on Further Restrictive Economic Measures: 26 February 2022 - GOV.UK (www.gov.uk),

European Commission: Joint Statement on further restrictive economic measures (europa.eu),

United States: Joint Statement on Further Restrictive Economic Measures | The White House