The Congressional Research Service recently issued two new reports detailing the U.S.’s and its allies’ response to Russia’s invasion of Ukraine and an overview of recent sanctions and export controls. The CRS said Western economies, including companies, are “likely” to be affected by the new trade measures and “many transactions will likely be disrupted,” especially in the energy sector.
Congress should make sure the Treasury Department has enough funding to fully target Russian oligarchs and sanctioned Russian companies Sen. Ron Wyden, D-Ore., said March 1. Wyden, chair of the Senate Finance Committee, applauded Treasury’s Russia sanctions work so far but said Congress may need to provide the agency with more resources.
The Office of Foreign Assets Control added Russian sanctions regulations to implement a sweeping April 2021 executive order that authorized new designations against people and companies operating in Russia’s defense and technology sectors, involved in attempts to influence foreign elections and more (see 2104150019). The added regulations, which took effect March 1, are in an “abbreviated form” so OFAC can provide “immediate guidance to the public.” The agency intends to add more regulations, which could include guidance on various definitions and general licenses.
SWIFT, the global financial messaging system for banks, said March 1 it’s still waiting to hear from the U.S., the EU and other countries about which Russian banks to exclude from its services. A White House official said this week the U.S. and allies were compiling a list of banks, which will likely include any Russian financial institutions subject to multilateral sanctions (see 2202280043). “Diplomatic decisions have brought SWIFT into efforts to bring this crisis to an end, and we will always comply with applicable sanctions laws,” SWIFT said in a statement. “We are engaging with these authorities to understand which entities will be subject to these new measures and will disconnect them once we receive legal instruction to do so.”
The EU released a fact sheet laying out restrictions against Russia that now amount to sanctions on 654 individuals and 52 entities, along with sectoral sanctions that cover Russia's financial, energy, transport and dual-use goods industries. The EU Feb. 25 suspended its visa facilitation process for Russian diplomats, officials and businesspeople, which typically grants them privileged access to the EU.
The United Kingdom maintained its barrage of restrictions imposed against Russia following its invasion of Ukraine. So far, the government has sweeping sanctions on a host of Russian individuals and entities, including the Russian Central Bank and President Vladimir Putin himself (see 2202280024). This deluge continued on Feb. 28 and March 1 with greater action to isolate Russia and freeze it out of the global economy.
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The White House today announced a series of additional sanctions and export controls targeting Russia and Belarus for the invasion of Ukraine, including new restrictions on technology and software exports to Belarus, export controls on shipments of oil and gas extraction equipment to Russia, blocking sanctions on 22 Russian defense entities and a prohibition on Russian cargo planes flying to and from the U.S. Commerce will also add more entities to its Entity List that support Russian and Belarusian security services and defense efforts.
New U.S. sanctions and export controls against Russia could present significant additional compliance and due diligence requirements for companies operating in the region and more trade restrictions are likely on the way, law firms said.
Global shipper Maersk says it is "monitoring and preparing to comply with the ever-evolving sanctions and restrictions imposed against Russia while we safeguard our operations and our people in consideration of the constant developing situation." The company said Feb. 28 it may suspend bookings, both on ocean and inland, to and from Russia. "For cargo already on the water we will do our utmost to deliver it to its intended destination," it said. "We have a sharp focus on safeguarding reefer containers and keeping cold chain operations as stable as possible, as the commodities include important goods such as groceries and pharmaceuticals. We are doing everything possible to prevent risk to the above cargo and in turn risk to the end-users in need of these commodities. It’s also worth noting that air space is also gradually being restricted and our air services will be impacted," the company said.