Twelfth sanctions package
The EU adopted a twelfth package of sanctions on 18 December 2023.Please see attached press release providing details .
Some of the measures include a new obligation to contractually prohibit re-exportation of sensitive goods to Russia. Exporters will be required to contractually prohibit the re-exportation to Russia and re-exportation for use in Russia when selling, supplying, transferring or exporting to a third country (with certain exceptions) goods or technology such as aviation and space items, jet fuel and additives and firearms and other arms and ammunition .
Other measures include financial restrictions such as a ban on Russian nationals owning, controlling or holding any posts on the governing bodies of those providing crypto-asset wallet, account or custody services to Russian persons and residents. The existing prohibition on the provision of services will be extended to include a ban on the provision of software for the management of enterprises and software for industrial design and manufacture.
A new measure is introduced that will require the notification of certain transfers of funds out of the EU from EU entities directly or indirectly owned by more than 40% by Russians or entities established in Russia.
Member States must designate by October 31, 2024, a national authority to identify and trace funds and economic resources belonging to, or owned, held, or controlled by designated individuals and entities located in their jurisdiction, to prevent and detect attempts or instances of sanctions violations or circumvention.
Click here for Q&A from the European Commission on the twelfth package and here to see the consolidated FAQs from the European Commission.
OFSI Annual review
On 14 December 2023, the Office of Financial Sanctions Implementation (OFSI) published its Annual Review for the financial year 2022 to 2023. It states that in the medium term the outlook indicates continued intensity for financial sanctions. The report contains reporting on assets frozen under UK financial sanctions regulations. The review discloses that £22.7 billion of assets have been frozen in relation to Russia and OFSI staffing has increased significantly. However, there has been no fines for a post-Feb 2022 sanctions breach in relation to the UK's Russia sanctions regime.
Penalties for the violation of Union restrictive measures
Currently member states have different definitions of what constitutes a violation of restrictive measures and what penalties should be applied in the event of such a violation. On 12 December 2023 the EU Council and Parliament reach political agreement to criminalise violation of EU sanctions .Please click here for the proposal made by the EU council in May 2023 in relation to the definition of criminal offences and penalties for the violation of Union restrictive measures , the press release of June 2023 and the press release on December 2023 .
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