Sanctions against Russia: implementation in practice

The first step is to check whether there are any bans on the direct or indirect provision of economic and/or financial resources to your business partner. The various sanctions packages include comprehensive bans of this nature against individuals, legal entities, and organizations.

Companies with a Compliance Screening solution from AEB can automatically check whether their business partners are sanctioned. EU bans on the direct provision of economic and/or financial resources are updated each day in the Consolidated Financial Sanctions Parties List (CFSP list). Besides the CFSP list, businesses can also select other lists relevant to their operations from AEB’s extensive library of restricted party lists.

Business dealings with the Russian state-owned enterprises listed in Annex XIX of Embargo Regulation 833/2014 are prohibited, for example. These enterprises appear alongside other Russian financial institutions on the “Restrictions on Access to the Capital Market” list issued by the Council of the European Union. The legal implications of a match, and thus the question of further business relations with the enterprise concerned, depend on the list where the match is found and the legal consequences associated with the listing.

When doing business with a sanctioned country, you must prioritize the terms of the embargo in your screening process. For Russia, the situation is as follows: Sanctions were imposed under EU Embargo Regulation No. 833/2014 back in July 2014 after Russia annexed Crimea and occupied Donetsk and Luhansk.

The EU continuously adapts these sanctions from 2014 with new packages – most recently on October 6.
The embargo regulation against Russia has various annexes covering a broad spectrum of goods ranging from high-tech to luxury goods such as wines and spirits. The goods in question are often identified in the annexes by commodity code. Companies need to check whether they are affected by the listings.

Unlike the EU Dual-Use Regulation 2021/821, the embargo regulations cover not only the export and transfer of such goods but also their sale and delivery. This has far-reaching consequences in practice, as the following two examples illustrate:

Answering this question checks the licensing requirements for the export of listed goods. The question of license requirements, however, is not relevant for business transactions with Russia, as listed goods are subject to a comprehensive ban.

The last question checks designated use. This check must be applied to all goods not subject to restrictions from the previous steps. A license is required for these goods if there is knowledge of one of the end-uses described in Art. 4 (1) and Art. 5 of the EU Dual-Use Regulation.