Russia and Belarus Sanctions Update – March 17, 2022

Key Takeaways:

  • The United States, the United Kingdom and the European Union (EU) have imposed additional sanctions in response to Russia’s escalating conflict in Ukraine.
  • The United States has imposed sanctions on human rights abusers and senior Russian defense officials.
  • The United Kingdom has banned more than 370 Russians, including 51 oligarchs and their families.
  • The European Union imposes restrictions on investment and trade and imposes sanctions on Russian oligarchs, propagandists, state-owned entities and defense entities.

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On March 15, 2022, the United States, the United Kingdom, and the European Union announced new sanctions against various individuals and entities for Russia’s aggression in Ukraine. The United States has added some Russian human rights abusers and senior Russian defense officials to its list of specially designated citizens and detainees (“SDN”). The UK sanctions target Russian oligarchs and their family members, including President Vladimir Putin’s political allies and propagandists. The EU has imposed extensive restrictions on transactions with some state-owned entities and has imposed some trade sanctions and sanctions against Russian energy sector investors as well as oligarchs, pro-Kremlin propagandists and defense entities.

I. Additional U.S. Sanctions

    1. Magnitsky law labeled human rights violations

On March 15, 2022, the US Treasury Office of Foreign Assets Control (“OFAC”) re-nominated Belarusian President Alexander Ryhorovich Lukashenko, who was already an SDN and imposed sanctions under Executive Order 134500. And his wife, Halina Radjivonaona Lukashenka, for their involvement in public corruption in Belarus.

Furthermore, under the Sergei Magnitsky Rule of Law Accountability Act 2012 (“Magnitsky Act”), OFAC added four persons to its SDN list, in addition to one entity. New additions to the SDN list include those who were involved in gross human rights abuses against Russian human rights defender Yub Titiyev or who were involved in covering up the events surrounding the death of Sergei Magnitsky (named after him), including a Russian judge and investigating officer. As a result of the SDN listing, all U.S. assets held by these individuals have been frozen, and U.S. individuals have been barred from engaging in most transactions with nominees.

    1. Designation of Russian Defense Officers

On the same day, the US State Department also announced that it had added 11 senior Russian defense officials to the SDN list in accordance with Executive Order 14024 for working in the defense sector of the Russian Federation’s economy. These people include:

      • Alexei Kryvoruchko, Deputy Minister of Defense of the Russian Ministry of Defense;
      • Timur Ivanov, Deputy Minister of Defense of the Russian Ministry of Defense;
      • Yunus-Bek Ivkurov, Deputy Minister of Defense of the Russian Ministry of Defense;
      • Dmitry Bulgakov, a Russian defense minister and general in the army;
      • Yuri Sadovenko, Deputy Minister of Defense of the Russian Ministry of Defense;
      • Nikolai Pankov, Deputy Minister of Defense of the Russian Ministry of Defense;
      • Ruslan Tsalikov, Deputy Minister of Defense of the Russian Ministry of Defense;
      • Gennady Zhidko, Deputy Minister of Defense of the Russian Ministry of Defense;
      • Viktor Zolotov, a Russian general in the army and commander-in-chief of the Russian National Guard Troops;
      • Dmitry Shugayev, director of the Federal Service for Military Technical Cooperation at the Russian Ministry of Defense; And
      • Alexander Mikhev, director general of Rosoboronexport, a Russian state-regulated intermediary that conducts foreign trade in military products.

2. The United Kingdom has added 360 people to the sanctions list

The United Kingdom announced an additional clause in the new Economic Offenses (Transparency and Enforcement) Act 2022 on March 15, 2022. The UK has approved more than 370 people, including 51 oligarchs and their family members, as well as politicians. Authorized persons will have their assets frozen in the UK, meaning no UK citizen or company will be able to do business with them and they will be banned from traveling to or from the UK. The new titles include the following Russian oligarchs:

      • Mikhail Friedman, founder of Alpha Bank, Russia’s largest private bank, and co-founder of investment company LetterOne;
      • Petr Aven, who was president of Alpha Bank and co-founder of LetterOne;
      • Aven and Friedman are business partners in both German Khan, Alpha Bank and LetterOne;
      • Alexei Mordashev, (allegedly) a member of Russia’s richest family and a majority shareholder in the steel company Severstal;
      • Andrei Melnichenko, founder of Eurochem Group;
      • Victor Wexelberg, owner of the Renova Group;
      • Alexander Ponomarenko, chairman of the board of Sheremetyevo, Russia’s largest airport;
      • Dmitry Pompianski, owner and chairman of OAO TMK, which manufactures equipment for the oil and gas industry; And
      • Vadim Moshkovich, chairman of the board of directors of Rusagro Group, one of the largest agricultural companies in Russia.

III. Additional EU sanctions

Together with the United Kingdom and the United States, on March 15, 2022, the EU announced that it would impose a fourth round of personal and economic sanctions because of Russia’s continued military aggression against Ukraine. In this latest move, the European Union has imposed an almost complete ban on transactions with the following Russian state-owned entities:

      • Opk Oboronprom
      • PJSC United Aircraft Corporation
      • JSC Research and Production Corporation Uralbhaganjavod
      • PJSC Rosneft Oil Company
      • JSC Transneft
      • Gazprom Neft
      • JSC Concern VK also “Almaz-Ante”
      • Kamaj
      • Rostek (Russian Technologies State Corporation)
      • JSC Po Sebamash
      • Sovkamflot
      • JSC United Shipbuilding Corporation

This restriction extends to non-EU subsidiaries of entities that are directly or indirectly owned by these entities for 50% or more, as well as restrictions on transactions with these entities and the persons who act on their behalf. Limited Exceptions (a) Strictly necessary for the purchase, import or transportation of fossil fuels, especially coal, oil and natural gas, as well as titanium, aluminum, copper, nickel, palladium and iron ore or in the European Union through Russia; And (b) transactions involving energy projects outside of Russia where one of the authorized entities has only a minority shareholder.

The EU has banned some new investments in the Russian energy sector and barred any Russian person or entity from providing credit rating services, effective April 15, 2022. Moreover, the EU has imposed trade sanctions on iron ore. , Steel, and luxury goods. The EU has directly or indirectly banned the import of iron and steel products into the European Union, if they are either in Russia or exported from Russia. Similarly, the purchase of iron or steel products that originate in Russia or are exported from Russia is also prohibited. In the case of luxury goods, the EU prohibits the sale, supply, transfer or export of luxury goods (directly or indirectly) to “any person, entity or entity in Russia or for use in Russia”. This restriction only applies to luxury products that cost more than ইউ 300 per item.

Finally, the EU has added 9 entities and 15 individuals to the list of individuals, entities and entities under the restrictive provisions laid down in Annex to Decision 2014/145 / CFSP of 2014/145 / CFSP:

      • Roman Arkadievich Abramovich, an oligarch who is a member of Vladimir Putin’s inner circle;
      • German Borisovich Khan, an oligarch who is a member of Vladimir Putin’s inner circle;
      • Viktor Felipovich Rashnikov, an oligarch and leading Russian businessman;
      • Alexei Viktorovich Kuzmichev, an oligarch who is a member of Vladimir Putin’s inner circle;
      • Alexander Alexandrovich Mikhev, CEO of Rosoboronexport;
      • Alexander Nikolayevich Shokhin, President of the Russian Union of Industrialists and Entrepreneurs and a member of Vladimir Putin’s inner circle;
      • Andrei Valeryvich Rumin, executive director of the Rosetti PJSC, and a member of Vladimir Putin’s inner circle;
      • Armen Sumbatovich Gasparian, who runs the pro-Kremlin propaganda television program;
      • Artem / Artem Grigorievich Sheinin, a Russian preacher who supports the illegal occupation of Crimea and promotes ethnic hatred between Russians and Ukrainians;
      • Dmitry Yevgenyevich Kulikov, a Kremlin preacher;
      • Konstantin Lovovich Ernst, CEO of Channel One Russia;
      • Marina Vladimirovna Sechina, who was nominated to benefit from the Russian decision-makers responsible for Crimea’s annexation or instability in Ukraine;
      • Suleiman Abusaidovich Karimov, owner of the financial and industrial group Nafta Moscow and a member of Vladimir Putin’s inner circle;
      • Tigran Oganesovich Khudaverdian, executive director of Yandex, a company used to hide information about the war in Ukraine from the Russians; And
      • Vladimir Valeryvich Rashevsky / Vladimir Valeryvich Rashevsky, CEO and director of Eurochem Group AG and a member of Vladimir Putin’s inner circle.

The European Union has also seized the assets of the following Russian defense companies:

      • Rosneft Arrow
      • JSC Rosoboronexport
      • JSC NPO high precision system
      • JSC Kurganmashjavhod
      • JSC Russian Helicopter
      • PJSC United Aircraft Corporation
      • JSC United Shipbuilding Corporation
      • JSC Research and Production Corporation Uralbhaganjavod
      • JSC Zelenodolsk Shipyard

In the case of Ukraine, Foley Hog will continue to provide updates as the situation improves. Organizations that have questions about these activities or how to ensure compliance with U.S. sanctions and export control regulations should contact a member of the Foley Hog Trade Prohibition and Export Control Practice. For information on previous Russia-related activities, see our previous customer alerts issued March 15, March 11, March 7, March 1, February 28 and February 17.

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