Sanctions and other useful information in response to crisis in Ukraine

Page last updated 27 April 2022

Introduction

As a result of the recent Russian invasion of Ukraine, focus has intensified on the area of sanctions which are being introduced at an unprecedented pace. This webpage seeks to centralise information and resources for members to help them comply with their obligations. The situation on sanctions is fast moving so please check back on the page for periodic updates.

In Ireland, financial sanctions emanate from the EU and the UN, and are contained in sanctions lists. All natural and legal persons are required to comply with financial sanctions. This requires monitoring the EU and UN lists and taking appropriate action, more details of which are given below.

It is a criminal offence not to comply with sanctions and firms which do not comply also risk reputational damage.

CCAB and CCAB-I Guidance

On 2 March 2022, CCAB issued a joint statement to the profession following recent and ongoing development in Ukraine.  This guidance concentrates on our UK based members’ obligations in relation to sanctions, ethical considerations and obligations under AML legislation.

On 4 March 2022, Chartered Accountants Ireland, together with the other members of CCAB Ireland, issued a joint statement to the profession following recent and ongoing developments in Ukraine. This guidance considers Irish members’ obligations in relation to sanctions, ethical considerations and obligations under AML legislation.

CCAB-I recently issued its updated Anti Money laundering guidance for accountants. While the main focus is general anti money laundering guidance for members and others, there are some paragraphs included in relation to sanctions at 5.2.28. Readers are also reminded that one of the geographical risk factors for potentially higher risk of money laundering or terrorist financing listed in the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 is countries subject to sanctions, embargos or similar measures issued by organisations such as, for example, the European Union or the United Nations.

Professional Indemnity Insurance Considerations

Members are reminded that the imposition of sanctions may impact on the operation of exclusion clauses (if any) in their Professional Indemnity arrangements and should ensure that they check the current position with their providers.

Ireland

Links to the following websites provide further detail on information that is relevant in Ireland and which members may find useful. 

Irish Central Bank

Financial sanctions emanate from the EU and the UN and are contained in sanctions lists - see EU and UN headings below. There are now five packages of sanctions which have been adopted by the EU. The Central Bank webpages contain an up to date Financial Sanctions Update 2022 where you can see details of EU and UN Security Council updates. Please also visit the Central Bank's page on changes to the Russia/Ukraine Regulations  which contains some useful information . Members must check whether they hold any funds or economic resources for the persons set out in the current sanctions lists. Please see the page also for where on 20 April 2022 the Central Bank  provided information on how credit institutions should report information regarding deposits by certain persons linked to Russia/Belarus that exceed EUR 100,000.

In relation to Fund Service Providers, the Central Bank issued an industry communication to them on 7 March 2022 on effectively managing risks due to the Russian invasion into Ukraine. The letter sets out Central Bank expectations that Fund Service Providers will take timely action, with heightened precautions, to ensure no breaches of the sanctions occur.

The Central Bank website states that once a person or entity has been sanctioned under EU Financial Sanctions, there is a legal obligation not to transfer funds or make funds or economic resources available, directly or indirectly, to that person or entity.

For general information on sanctions, you can click here to access the Central Bank webpage "Introduction to Financial Sanctions”.  The  Central Bank also has a Financial Sanctions FAQs Booklet (2015) and while it is published for credit and financial institutions, it may answer some of your general queries in relation to sanctions.

Irish Revenue Commissioners

The Revenue Commissioners have  published and updated a manual on EU Sanctions in response to the situation in Ukraine. Please click here to access the manual. The manual may be of somewhat limited value as some paragraphs are redacted/not published under FOI legislation.  However, the manual states that the relevant unit to contact is the Prohibitions and Restrictions Unit and the contact email is rcpr@revenue.ie. 

Revenue has also dedicated a website for Ukrainian Nationals which sets out advice for starting a job
https://www.revenue.ie/en/life-events-and-personal-circumstances/moving-to-or-from-ireland/advice-ukrainian-nationals-starting-job-ireland.aspx

Department of Enterprise Trade and Employment (DETE)

Workplace Relations Commission 

Members should be aware of and adhere to the current trade prohibitions issued by the DETE - see  EU Trade Sanctions in Response to Situation in Ukraine - DETE (enterprise.gov.ie). These include those that apply to military-related goods and technology, or financial or technical assistance; and dual use goods and technology.

The Department of Enterprise Trade and Employment has published a Guidance Note: EU Trade Sanctions in response to Russia’s aggression against Ukraine .The latest version of it is dated 9 April 2022 and you can click here to access it.

The Department of Enterprise, Trade and Employment is the competent authority responsible for enforcing trade-related sanctions. Queries regarding trade sanctions should be directed to the Trade Licensing and Control Unit. They can be contacted by email at exportcontrol@enterprise.gov.ie. or by telephone on +353 1 631 2328.

Please also refer to the website of the Workplace Relations Commission which contains information for Ukrainian Nationals on employment rights in Ireland .There is information on the website on employment law in the Ukrainian language and the Russian language.

Department of Finance – Ireland

Please click here for policy information from the Department of Finance on Anti-Money Laundering and Countering the Financing of Terrorism. Paragraph 10 contains information relating to sanctions. Members are reminded that all legal and natural persons are bound by the obligations in the sanctions.

Please click here for the Institute’s  recent news updates on communications from the Irish Department of Finance and see also information under "Europe" heading below.

EU and UN sanctions are implemented in Ireland through EU council decisions and regulations. The regulations are directly applicable in Irish law. In addition, statutory instruments (SIs) are frequently made in order to provide for a domestic offence for breach of the sanctions and for related penalties. A comprehensive list of SIs may be found in the searchable Irish Statute Book, and a number of new regulations in relation to Ukraine and Belarus have been made by the Minister for Finance recently.

The Dept of Finance published the booklet Economic and Financial Impacts of War in Ukraine. It was last updated in April 2022.You can access the booklet here.

Department of Foreign Affairs

The Department of Foreign Affairs has information about sanctions here in respect of the situation in Ukraine. See here also for general information about sanctions on the DFA website (See information on domestic guidance at the bottom of the page).

Department of the Taoiseach

The Department of the Taoiseach has established a webpage where there is information for people on arriving in Ireland, accommodation ,social welfare supports, employment, childcare and education healthcare and how people and community groups can help .

The page also has information for businesses on sanctions ,offers of employment and support and sectoral schemes . 

Europe

Following below are further details on the sanctions imposed by the European Union.

The EU has been imposing sanctions and restrictive measures against Russia since 2014 following their invasion of Crimea. This European Council infographic provides an excellent summary of the types of sanctions imposed.

The most recent measures agreed at EU Council level on the current crisis can be accessed  here .Five packages of sanctions have now been adopted. The European Commission has now set up a dedicated webpage, entitled Sanctions adopted following Russia’s military aggression against Ukraine, which contains information on the various sanctions adopted, including Frequently Asked Questions. The page is regularly updated at the moment. 

The EU list of sanctions is available on the Irish Central Bank’s website Financial Sanctions Updates 2022. The situation is very fast moving and members are reminded to check these on a frequent basis. 

On 21 April 2022 the EU adopted restrictive measures against two further individuals within the existing sanctions framework .EU restrictive measures regarding the undermining of territorial integrity of Ukraine now apply to a total of 1093 persons and 80 entities.

On 8 April 2022 the EU adopted a fifth package of restrictive measures against Russia. The package contains the following six elements (summarised from the information available on the European Commission website and information made available to us from the Dept. of Finance):

 1. A coal ban. An import ban on all forms of Russian coal from 10 August 2022.

 2. Financial measures

• A full transaction ban and asset freeze on four Russian banks These four banks will now be fully excluded from the EU market. The banks affected are Otkritie, Novikombank, Sovkombank and VTB.
• A prohibition on providing high-value crypto-asset services to Russia.
• A prohibition on providing advice on trusts to wealthy Russians.

 3. Transport

• A full ban on Russian and Belarusian freight road operators working in the EU. Certain exemptions will cover essentials, such as agricultural and food products, humanitarian aid as well as energy.
• An entry ban on Russian-flagged vessels to EU ports.This includes yachts and recreational craft. Exemptions apply for medical, food, energy, and humanitarian purposes, amongst others.

4. Targeted export bans. Worth €10 billion in areas in which Russia is vulnerable due to its high dependency on EU supplies including for example sensitive machinery, transportation and chemicals. Jet fuel and fuel additives which may be used by the Russian army, are added to the existing export ban.

5. Extending import bans

• Additional import bans – worth €5.5 billion - including cement, rubber products, wood, spirits (including vodka), liquor, high-end seafood (including caviar), and an anti-circumvention measure against potash imports from Belarus.

6.Excluding Russia from public contracts and European money; legal clarifications and enforcement.

• Full prohibition on the participation of Russian nationals and entities in procurement contracts in the EU. Limited exceptions may be granted by the competent authorities where there is no viable alternative.
• Restriction on financial and non-financial support to Russian publicly owned or controlled entities under EU, Euratom and Member State programmes.
• Addressing various overlaps between export restrictions on dual-use items and advanced technologies and other provisions.
• Extending to all official EU currencies the prohibitions on the export of banknotes and on the sale of transferrable securities.

An additional 217 individuals who are Russian, members of 'the People’s Council' of the Donetsk and Luhansk breakaway republics and 18 entities have been sanctioned.

On 15 March 2022 the EU published a further set of measures in relation to Russia. The measures that came into force on 15 March include adding another 15 individuals and 9 entities to the list of those subject to asset freezes and travel bans.

The measures that came into force on 16 March include:

• a ban on credit ratings agencies from providing ratings on Russian Federation debt.
• further trade restrictions concerning iron and steel, as well as luxury goods;
• expanding the list of persons connected to Russia’s defense and industrial base, to apply tighter export restrictions on dual-use goods and technology. A total of 81 persons and entities have been added;
• prohibitions on new investments in the Russian energy sector and export restrictions on related equipment, technology and services, with the exception of nuclear industry and energy transport;
• a ban on all transactions with certain State-owned enterprises which are already subject to refinancing restrictions. A total of 13 companies are listed;
• a ban on the provision of insurance and reinsurance to any legal person, entity or body operating in the energy sector in Russia;
• Derogations have been provided for activities necessary for ensuring critical energy supply within the EU, as well as the transport of fossil fuels, in particular coal, oil and natural gas, from or through Russia into the EU; and where humanitarian considerations arise.

On 9 March 2022, the European Council issued a press release announcing the EU's agreement to new sectoral measures targeting Belarus and Russia, this one targeting the Belarusian financial sector and a further press release later the same day concerning its decision to impose restrictive measures on 160 individuals as a consequence of Russia’s military aggression against Ukraine.

Details of measures introduced on 9 March 2022 include:

Introduction of further restrictions on the export of maritime navigation goods and technology;

• Expansion of the list of legal persons, entities and bodies subject to the prohibitions related to investment services, transferable securities, money market instruments, and loans;

• Further clarification (in respect of previous restrictive measures) that “transferable securities” includes crypto-assets.
• Limiting the financial inflows from Belarus to the Union, by prohibiting the acceptance, from Belarusian nationals or residents, of deposits exceeding certain values; the holding of accounts of Belarusian clients by the Union central securities depositories; and the selling of euro-denominated securities to Belarusian clients;

• Exemptions under the sanctions measures, for Swiss, EU and EEA nationals in Belarus, in that deposits exceeding €100,000 can be accepted from them.

• Introduction of clarifications on the exception for the provision of financing for small and medium-sized enterprises, as well as certain provisions in the Annexes, relating to prohibited goods and technology;

• Adding 146 members of the Russian Federation Council to the sanctions list, as those individuals ratified the government decisions of the ‘Treaty of Friendship, Cooperation and Mutual Assistance’ between Russia and the two break-away regions in Donetsk and Luhansk;

• Adding 14 persons to the sanctions list, as they supported and benefited from the Government of the Russian Federation and/or provided substantial revenue to it; or are associated with listed persons or entities.

• Prohibition on the listing and provision of services, on Union trading venues, in relation to shares of Belarus State-owned entities;

• Prohibition on transactions with the Central Bank of Belarus;

• Restrictions on the provision of specialised financial messaging services (SWIFT) to certain Belarusian credit institutions and their Belarusian subsidiaries. These are:

-  Belagroprombank

-  Bank Dabrabyt

-  Development Bank of the Republic of Belarus'

• Additional obligations on the Network Manager for air traffic management network functions of the single European Sky, particularly that the Manager rejects all flight plans that violate the Regulations;

• Further clarification (in respect of previous restrictive measures) that “transferable securities” includes crypto-assets.

Please see here a Q &A from the European Commission website on the fourth package of restrictive measures against Russia.

There is a consolidated list of persons, groups and entities subject to EU financial sanctions, which reflects the officially adopted texts published in the Official Journal of the EU. You need to create an account to log in. This is a simple process. EU Login (europa.eu).

A PDF version of the consolidated list of financial sanctions can also be downloaded, but members should be aware that this list is constantly being amended and updated.

A useful list which contains summaries of all EU sanctions is available on the EU Sanctions Map.

 An overview of EU sanctions is provided here by the European External Action Service. See also the European Commission page containing general FAQs and answers on restrictive measures -sanctions e.g. types of sanctions and who is bound by them (Click here for the pdf version).

The European Commission has issued Guidance to the Member States concerning foreign direct investment from Russia and Belarus in view of the military aggression against Ukraine and the restrictive measures laid down in recent Council Regulations on sanctions. Download the guidance by following this link

The European Banking Authority (EBA) recently published a statement addressed to both financial institutions and supervisors to ensure they make every effort to provide access for Ukrainian refugees to at least basic financial products and services. They also set out how AML/CFT guidelines should apply. You can read details of the statement here.

Accountancy Europe have issued a useful publication ‘War in Ukraine – what European accountants need to know’ which highlights the main points that members need to consider in relation to AML, cybersecurity, and the implications for accounting, reporting and audit.

The European Competition Network (ECN), a network of 27 competition authorities within the European Union and the DG Competition of the European Commission recently issued a joint statement on the application of competition law in the context of the war in Ukraine. They noted that  the different EU/EEA competition instruments have mechanisms to take into account, where appropriate and necessary, market and economic developments and that this extraordinary war situation may trigger the need for companies to address severe disruptions caused by the impact of the war and/or of sanctions in the Internal Market. The joint statement can be viewed on the Irish Competition and Consumer Protection Commission website.

On 9 March 2022 the European Intellectual Property office (EUIPO) in support of Ukraine has adopted a number of measures in coordination with the EU institutions in the field of intellectual property. They have halted all cooperation actions with Rospatent, the Russian Federal Service for Intellectual Property, and the Eurasian Patent Organisation (EAPO). They  have also  taken measures to provide their  fullest support to Ukrainian customers and to safeguard their IP rights while this situation prevents normal communication. More details of their statement and position can be found on their website.

European Union whistleblower tool

The European Union sanctions whistleblower tool is accessible via the Commission’s website at https://eusanctions.integrityline.com/. It facilitates the anonymous reporting of possible violations of EU sanctions. It can be used to report past, ongoing or planned sanctions violations, as well as attempts to circumvent EU sanctions.

More details about the tool are available at https://ec.europa.eu/info/business-economy-euro/banking-and-finance/international-relations/restrictive-measures-sanctions_en#whistleblower

The EU has created a specific Directive – the Temporary Protection Directive – to coordinate member states granting Ukrainian citizens a residence and work permit, known as a Temporary Protection Permit. This temporary protection will be valid for one year and can be extended for up to three additional years. The Directive may directly impact employers as it will afford the right to work in Ireland to those coming from Ukraine. You can read more details about it here.

United Kingdom

Members will find the most pertinent information in the CCAB guidance above.  

Please also click here for some further information on the Institute’s website .

Other useful information relevant to the UK includes:

This page which provides a guide  to the current consolidated list of asset freeze targets, and a list of persons named in relation to financial and investment restrictions .It identifies people, entities and ships which are designated or specified under regulations made under the Sanctions and Anti-Money Laundering Act 2018 and the reasons why.

The Statement on Ukraine crisis and its implications for charities - GOV.UK (www.gov.uk) provides a timely reminder to charities on knowing their donors and key questions that they need to ask before accepting donations.

Likewise, the Charity Commission for Northern Ireland has also issued advice for people to give safely and for charities wishing to help in the crisis.

UK Parliament has recently passed the Economic Crime (Transparency and Enforcement) Act 2022. Its long title describes it as a Bill to set up a register of overseas entities and their beneficial owners and require overseas entities who own land to register in certain circumstances; to make provision about unexplained wealth orders; and to make provision about sanctions. You can access the details of the legislation here.

The Office of Financial Sanctions Implementation (OFSI), part of HM Treasury, issued Russia Guidance for the financial and investment restrictions in Russia (Sanctions) (EU Exit) Regulations 2019 .Some of the guidance has been updated for the 2022 sanctions (apparent from the guidance).You can read further about it here.

UK financial regulatory authorities issued a joint statement on sanctions and the cryptoasset sector on 11 March 2022 reiterating that all UK financial services firms, including the cryptoasset sector, are expected to play their part in ensuring that sanctions are complied with. You can read details of the joint statement on the Financial Conduct Authority (FCA) website.

In February the FCA also issued guidance, available on its webpages ,on challenges in terms of disposing of Russian assets. See also the FCA sanctions page here.

The UK exchanges tax information with Russia under the Convention on Mutual Administrative Assistance in Tax Matters and Russia and Belarus under bilateral Double Tax Agreements. This tax information is exchanged as part of global collaboration to address tax compliance risks. As of March 17 the UK has suspended all exchange of tax information with Russia and Belarus under the UK’s exchange of information agreements. You will find the link to the announcement here https://www.gov.uk/government/news/uk-suspends-tax-co-operation-with-russia

The UK Government has recently provided some useful information on Ukraine tax relief and guidance:

Homes for Ukraine:

Homes for Ukraine scheme: frequently asked questions. This UK Government page details Questions and answers on how the Homes for Ukraine scheme will work.

No tax to pay on £350 ‘thank you’ payments

Legislation will be introduced to exempt the £350 ‘thank you’ payments made by Local Authorities to sponsors under the ‘Homes for Ukraine’ scheme from income tax and corporation tax. In the meantime the government has confirmed that it will not collect any tax on these payments. Recipients should also disregard such payments when calculating income for the purposes of tax credits.

Tax relief for companies making properties available

The government has confirmed that companies making dwellings available to support the ‘Homes for Ukraine’ scheme will be relieved from the Annual Tax on Enveloped Dwellings (ATED) and the 15% rate of Stamp Duty Land Tax (SDLT).

Arrivals from Ukraine: Guidance for claiming Child Benefit

Anyone coming to the UK under the ‘Ukraine Family Support’ or ‘Homes for Ukraine’ scheme is entitled to claim Child Benefit immediately – rather than having to wait for the usual three-month qualifying period. People should complete a CH2 Child Benefit claim form and submit this by post to the Child Benefit office, the address of which can be found on the form.

Claimants should provide an original birth certificate and the passport or travel document used to enter the UK. Where this documentation is not immediately available, people are advised to include a note in their claim and someone from HMRC will be in touch to discuss further. You can find more information on Child Benefit on GOV.UK or call 0300 200 3100 (from inside the UK).

The following information is provided from a circular from the UK's Department for Business, Energy and Industrial Strategy (BEIS):

Businesses can now sign up to offer work to people who have come to the UK from Ukraine. Further information on the process here.  

Customs easement to help Ukraine aid exports. A customs easement is now in place making it easier to move aid and donations to help the people of Ukraine. 

Russia sanctions: guidance. Guidance on the Russia (Sanctions) (EU Exit) Regulations. 

If you have a question about trading with Ukraine or Russia use the dedicated online service or call 0300 303 8955. Read the latest information about sanctions on trading with Russia. 

For further information on sanctions contact the FCDO at sanctions@fcdo.gov.uk 

A recent webinar: representatives including from the UK Foreign, Commonwealth and Development Office (FCDO), HM Treasury (HMT), Department for International Trade (DIT), Department for Transport (DfT), Business Enterprise Industry and Skills (BEIS) and other UK government departments spoke recently (17 March 2022) at a webinar entitled : UK Sanctions relating to Russia: Briefing by UK Government. The webinar was held to help attendees understand recent changes to UK sanctions relating to Russia and for their organisations to be updated and understand how to comply with recent changes. The webinar covered the following topics: sanctions legislation overview, new sanctions measures: financial, trade and transport, individual and entity designations and humanitarian issues. A recording of the webinar can be accessed here.

Insolvency Practitioners: please click here to read a publication from the Insolvency Service in the UK  on what Insolvency Practitioners need to consider in order to ensure that requirements are not breached in the cases they administer. It also deals with payment of dividends to sanctioned parties.

International

The UN publishes a consolidated list of all individuals and entities subject to sanctions measures imposed by the UN Security Council.

In the news

The following articles relating to the Ukraine situation may be of interest to members. 

The Ukraine crisis: Ethical considerations for accountants written by the Chartered Accountants Ireland Head of Ethics and Governance, Niall Fitzgerald.

EU agrees to exclude key Russian banks from SWIFT

EU and UK Sanctions against Russia: a focus on the Financial Sector

Ukraine invasion has made a fast, decisive union out of slow, bureaucratic EU - Originally posted on Business Post 06 March 2022.Dr Brian Keegan Director of Public Policy at Chartered Accountants Ireland

Financial Reporting implications of the war in Ukraine under FRS 102 is an article prepared by Chartered Accountants Ireland outlining some of the key financial reporting issues that preparers may face relating to the war.

On March 24 the EU Commissioner for Financial Services spoke to Ukrainian Finance Minister on sanctions and  EU support for Ukrainian war effort. Click here for the press release.

“Shaping Europe’s financial future” Mairead McGuinness, EU Commissioner for Financial Services, Financial Stability and Capital Markets Union, talks to Elaine O’Regan in Accountancy Ireland April 2022 including about her role in implementing sanctions to stop the “Kremlin war machine”

Some tips to support your staff during a crisis

Press statement dated 27 April 2022 by President von der Leyen following the announcement by Gazprom on the disruption of gas deliveries to certain EU Member States.

These pages are provided as resources and information only and nothing in these pages purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the pages. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of these pages, we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained in these pages.

Chartered Accountants Ireland can accept no responsibility for the content on any site that is linked to/from the Institute website. Links are provided in good faith for the potential support of members and students.