1. The new EU prohibition on dealing with specific state-owned entities

As of 16 March 2022, Council Regulation (EU) 2022/428 introduced Article 5aa, which provides that it "shall be prohibited to directly or indirectly engage in any transaction" with Russian state-owned entities (SOEs) listed in Annex XIX of Council Regulation (EU) No 833/2014 (as amended by Council Regulation 2022/428). The full list of SOEs and ownership requirements can be accessed here. Article 5aa(2) confirms that this prohibition "shall not apply to the execution until 15 May 2022 of contracts concluded before 16 March 2022".

  1. The impact of updated EU Regulations on the energy sector

Council Regulation (EU) 2022/428 forms part of the latest round of EU sanctions in relation to Russia. Article 3a has specific effect on the energy sector. With immediate effect from 15 March 2022, it is now prohibited in terms of Article 3a(1)(a) "to acquire any new, or extension of any existing, participation in any entity incorporated under the law or Russia and operating in the energy sector in Russia". The creation of new Joint Ventures with Russian entities is also prohibited. In addition, specific financial functions, such as the granting of loans or credit lines of the provision of investment services, are prohibited.

  1. Latest EU Regulations adding new listed individuals and entities

Council Implementing Regulation (EU) 2022/427 is a further part of the latest round of EU sanctions in relation to Russia. It added 15 individuals and 9 entities, operating in the aviation, military and dual use, shipbuilding and machine building sectors, to the EU Consolidated Financial Sanctions List as of 15 March 2022. These individuals and entities are now subject to a freeze on "all funds and economic resources belonging to, owned, held or controlled by" them in terms of Article 2(1) of Council Regulation (EU) No 269/2014. In addition, Article 2(2) states that "no funds or economic resources shall be made available, directly or indirectly, to or for the benefit of" listed individuals. Full details of the newly listed individuals and entities can be accessed here.

  1. Ongoing additions to the UK Sanctions List

The UK has recently strengthened its ability to make additions to the UK Sanctions List via the enactment of the Economic Crime (Transparency and Enforcement) Act 2022 on 15 March 2022. We discuss the Act in more detail here. Importantly, it has created a new expedited procedure for designating individuals and entities as subject to UK sanctions.

  1. 350 new designated persons added to the UK Sanctions List on 15 March 2022

On 15 March 2022, 350 individuals were designated in terms of the UK sanctions regime in relation to Russia. The majority of the additions are Members of the Federation Council of the Russian Federation and their family members. Other oligarchs and prominent individuals were also designated.

These additions to the UK Sanctions List followed the addition of 7 further oligarchs on 10 March 2022. That update can be accessed here.

Contributors

Ramsay Hall

Legal Director