EU Adopts 20th Sanctions Package on Russia

The Commission welcomes the adoption by EU Member States of the 20^th package of sanctions against Russia. The EU's commitment to a free and sovereign Ukraine is unwavering. This package puts further pressure on Russia to engage in negotiations and do so on terms acceptable for Ukraine. Every day of further Russian attacks on Ukrainian civilian infrastructure is another day of suffering for the Ukrainian people.

The new sanctions have a strong anti-circumvention angle and include robust energy measures, as well as the activation for the first time of the "anti-circumvention" tool. Today's package also targets financial services (including crypto), trade and media propaganda, and includes further measures for the protection of EU operators.

The 20^th package contains the following key elements:

ENERGY MEASURES

• Russian energy sector listings: 36 listings encompassing both the upstream and downstream segments of the Russian energy sector, including the exploration, extraction, refining, and transportation of oil.
• Shadow fleet ecosystem: Revenues from Russian oil exports are further reduced through the listing of additional shadow fleet entities, including those operating in third countries, as well as a significant maritime insurer and 46 additional vessel listings. With these additions, a total of 632 vessels in Russia's shadow fleet are now listed by the EU. They are subject to a port access ban and a ban on receiving services. Alongside these additional listings, the EU continues its outreach to flag states to ensure that their registers do not allow these vessels to sail under their flags. While 46 vessels are added to the sanctions list, 11 vessels are also delisted in this 20th package, showing that delisting is a possibility for vessels returning to compliance.
• Tanker Sales: Inserting safeguards on tanker sales from the EU to prevent Russian end-use. Dedicated due diligence by EU sellers, as well as a mandatory 'no Russia' clause to be passed on into sales contracts is to prevent usage deployment within the shadow fleet. A new shadow fleet scrapping clause will facilitate the decommissioning or 'recycling' of vessels and exit from the shadow fleet.
• Port infrastructure ban: Listing of two Russian ports (Murmansk and Tuapse) as well as, for the first time, a third country port (Karimun Oil Terminal, in Indonesia) for their connections with the shadow fleet and circumvention of the oil price cap.
• Future maritime services ban on Russian crude oil and petroleum products: the 20^th sanctions package includes the basis for a future prohibition to transport Russian oil and petroleum products, in full coordination and discussion with the G7 and the Price Cap Coalition (G7 members and other participating countries). The Council will decide when the Maritime Services Ban is to enter into force, considering an appropriate wind-down period. This would further reduce the total available capacity to transport Russian oil, hitting Russia's main source of revenue for its war machine.
• Maintenance: a new prohibition on maintenance services for Russian LNG tankers and icebreakers. This prohibits essential EU operators' support to Russian LNG exports and further constrains Russia's ability to maintain its seaborne assets.
• Ban on LNG terminal services: This will allow Union operators to terminate any long-term contracts with Russian operators.

FINANCIAL MEASURES

• Russian Banks: the new measures extend the ban on EU operators that do any business with twenty additional Russian banks, with narrow exceptions such as for humanitarian transactions. This brings the number of Russian banks excluded from access to the EU internal market to 70.
• Other third-country financial operators supporting Russia: the EU is extending the transaction ban to four banks in Kyrgyzstan, Laos, and Azerbaijan that assist the Russian war effort by significantly frustrating sanctions or connecting to the Russian System for Transfer of Financial Messages, the Russian banking messaging network.
• Russian crypto services and exchange: the 20th package includes a total sectorial ban on carrying out exchanges with any Russian crypto asset service provider as well as any decentralised platforms enabling crypto trading because of their use in circumvention.
• Cryptocurrencies and Central Bank Digital Currencies (CBCDs): the new measures prohibit the use of (and support to) the cryptocurrency RUBx, a rouble-backed stablecoin, as well the digital rouble, a digital currency under development by the Central Bank of Russia, which is being set up to enable sanctions circumvention.
• Payment services: the package prohibits transactions with agents in Russia and other third countries that offer to facilitate international transactions from Russia to bypass EU sanctions.
• Alongside the new financial measures, the Council today decided that 5 third-country financial entities are de-listed following the receipt of commitments that those entities will not engage in the activities for which they were listed.

TRADE MEASURES

The package introduces new export and imports restrictions and bans, to further disrupt and weaken Russia's military-industrial complex. These include:

• New export bans to Russia on goods – from rubber to tractors, worth over €365 million.
• New export restrictions on items and technologies used for Russia's military effort, such as explosives, laboratory glassware and high-performance lubricants and additives for lubricants.
• New restriction on provision of cybersecurity services to Russia.
• New import bans on metals, chemicals and minerals, not yet under sanctions, worth over €530 million.
• A quota on ammonia to cap existing imports.

RUSSIA'S MILITARY INDUSTRY

• Listings of producers and global suppliers: The 20^th package further constrains the Russian military-industrial complex by designating 58 companies and associated individuals involved in the development and manufacturing of military goods, such as drones. Additionally, listings cover third-country suppliers of critical high-tech items, such as entities based in China, the United Arab Emirates, Uzbekistan, Kazakhstan and Belarus which have provided dual-use goods or weapons systems to the Russian military-industrial complex.

ANTI-CIRCUMVENTION MEASURES

• Activating the "anti-circumvention tool" for the first time: The EU will not ignore cases of EU sanctions being systematically circumvented by exporters in third countries that re-export sanctioned EU goods to Russia. Today, the EU activated its anti-circumvention tool due to systematic and persistent failure by the Kyrgyz Republic to prevent the sale, supply, transfer, or export to Russia of certain machine tools and certain telecommunication equipment imported from the EU and used for the manufacturing of drones and missiles in Russia. These high-risk items allow Russia to pursue its illegal military aggression against Ukraine and sustain its ability to wage war.
• This package adds 60 entities to the list of those providing direct or indirect support to Russia's military industrial complex or engaged in sanctions circumvention. This includes 32 entities established in Russia and 28 in third countries (China, including Hong Kong, Türkiye, United Arab Emirates, and Thailand).

ADDITIONAL LISTINGS

• Today's package contains 120 additional listings, including 33 individuals and 83 entities, resulting in an asset freeze and the prohibition to make funds and economic resources available to them, and – in the case of individuals – also in travel bans. On top of the above-mentioned listings of Russian energy companies, Russian energy companies, Russian military companies and their supply chains in 3^rd countries, the EU is also imposing sanctions on oligarchs, persons involved in the abduction of children from Ukraine, propagandists and persons responsible for looting cultural heritage.

LEGAL PROTECTION OF EU OPERATORS

• Protection of EU Member States, operators, and citizens remains a key priority. The new package adds further legal protection for EU firms against retaliatory actions of the Russian Government, by allowing Member State courts to fine Russians that launch abusive lawsuits before Russian Courts. In addition, the package allows EU firms to claim damages in case of enforcement of abusive judgments in third countries other than Russia. Moreover, it enables the Council to impose a transaction ban on third country firms and individuals cooperating in the enforcement of such actions.
• The 20th package also introduces a transaction ban against Russian competitors taking advantage of de facto illegitimate expropriations of EU operators by the government of the Russian Federation.
• Additionally, the measures introduce a transaction ban against those Russians who steal and use intellectual property rights of EU operators in Russia against their consent.

OTHER MEASURES

• Fighting propaganda: New measures also tackle mirror outlets that circumvent the broadcasting ban by spreading the same content as listed propaganda media outlets (such as Russia Today, Sputnik etc.) online. The content of these mirror sites and domains will also be banned from distribution in the EU. This will facilitate the faster takedown or blocking of online sites that act as proxies or clones of official media outlets' channels.
• Protecting EU research: New measures prohibiting the acceptance of funding, including donations or grants, from the Russian government in the area of research and innovation. This applies to research institutes, higher education establishments and other bodies in the EU, as well as individuals associated with these entities.

BELARUS

The package also mirrors certain provisions of the Russian regime related to trade, finance, services and legal protection of EU operators in the Belarus sanctions regime.

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