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US Issues Hundreds of New Russia-Related Sanctions, Adds to Entity List

The U.S. this week announced a spate of new Russia-related sanctions and export controls, targeting people and companies supplying Russia’s military, aiding its defense industrial complex or operating in various Russian financial, metals, government and procurement sectors. The measures include additions to the Commerce Department’s Entity List and more than 200 combined sanctions by the Treasury and State departments targeting businesses in China, the United Arab Emirates and elsewhere for sending export-controlled components to Russia.

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The designations target producers, distributors, exporters and importers of nearly all the goods in the list of common high-priority items maintained by Commerce and recognized by other U.S. allies (see 2310020023 and 2309200031). Other measures target Russian energy and mining sectors, additional Russian government officials and more.

Many of the sanctions are meant to target people and companies in third countries who are helping Russia evade trade restrictions on electronic components and other technology. “Today’s actions demonstrate our further resolve in continuing to disrupt every link of [the] Russian military supply chain, and target outside actors who would seek to support Russia’s war effort,” Treasury Secretary Janet Yellen said.

The Bureau of Industry and Security added 12 entities in Russia and one in Uzbekistan to the Entity List for helping Russia procure or develop unmanned aerial vehicles. BIS said the entities “pose significant risk” of having ties to activities that support Russia’s war against Ukraine and designated each company as a Russian or Belarusian military end-user.

All 13 will be subject to restrictions under the BIS Russia/Belarus-Military End User Foreign Direct Product rule, which places license requirements on certain foreign goods made with certain U.S.-origin software or technology. The additions “highlight that no U.S. technology can be used to further our adversaries’ objectives,” BIS Undersecretary Alan Estevez said.

The new entities, added to the list in a final rule effective Nov. 2, are subject to license requirements for all items subject to the Export Administration Regulations, and most licenses will be reviewed under a policy of denial. Licenses for certain food and medicine listed as EAR99 will be reviewed case by case. All exports that now require a license as a result of this rule but were aboard a carrier to a port as of Nov. 2 may proceed to their destinations under the previous eligibility as long as the items have been exported before Dec. 4, BIS said.

Treasury’s sanctions target people and companies in China, Turkey, the UAE, Switzerland, Cyprus, Russia and elsewhere for helping the Russian government evade export controls and sanctions. The agency also sanctioned a range of Russian industrial manufacturing firms; one of the country’s largest publicly traded diversified holding companies and three of its subsidiaries; and various firms in Russia’s financial services sector.

Among those designated were China-based Beijing Jiahehengde Technology Company Ltd. and Beijing Shangyixianda Technology Company Ltd., which Treasury’s Office of Foreign Assets Controls said sent hundreds of shipments of electro-optical equipment, cameras, telecommunications equipment and other electronic components to Russia-based LLC Laser Components, an entity sanctioned this week by the State Department. OFAC also sanctioned China Taly Aviation Technologies Corp., which has shipped radar components to a Russian state-owned missile manufacturer for use in advanced antiaircraft missile systems.

Other designations target various Turkey-based companies, including Azint Elektronik Makina Gida Urunleri Tekstil Nakliyat Ithalat Ihracat Sanayi Ticaret Limited, which supplies “high-quality foreign-made microelectronics,” and Kuzey Logistics Tasimacilik Ithalat Ihracat Ve Dis Ticaret Limited Sirketi, a logistics company that offers Russian customs clearance and truck transportation services. Several of the sanctioned Turkish companies are owned by Turkish national Berk Turken, which OFAC said helps Russian intelligence services import technology for sanctioned Russian companies.

The agency also sanctioned a host of companies in the UAE, which U.S. officials have frequently said is a transshipment point for export-controlled goods to Russia (see 2303030018). Among those designated were 365 Days Freight Services FZCO, which ships computer components; Dubai Sea Breeze, which ships U.S.-origin aircraft parts and equipment to Russia; and Oman-based Tadawul Financial Services SAOC, a boutique investment firm used to house Russian assets, as well as the company’s founding partner and Irish national Liam Eoin Fraher and CEO and Latvian national Donats Skutelis.

OFAC also sanctioned Sistema Public Joint Stock Financial Corporation, a major Russian publicly traded holding company with ties to the country’s defense, financial and technology industries. Its three subsidiaries were also sanctioned: Luxembourg-based East West United Bank SA, Singapore-based Sistema Asia PTE LTD and Russia-based Sistema Smarttekh.

The agency also designated Public Joint Stock Company Saint Petersburg Exchange, a Russian brokerage that gives investors access to international stock markets, including the Russian stock market.

The State Department sanctioned nearly 100 companies and people, including Limited Liability Company Arctic LNG 2, the operator of Russian liquefied natural gas plan Arctic LNG 2 Project, and Joint Stock Company Russian Titanium Resources, a Russian metals company that the agency said is working on a project in Russia to develop the largest titanium ore deposit in the world.

The agency targeted various Russian procurement networks, including a group of companies supplying dual-use microelectronics and other technology. Those companies include Russia-based Baltelektron Limited Liability Company and Makro Tim Limited Liability Company, Mongolia-based Dafeng Asia Co LLC, Hong Kong-based Neway Technologies Limited, and Russian-registered companies Limited Liability Company Advanta Electro and Limited Liability Company Comfort Max.

The State Department said Maxim Marchenko -- the Russian citizen and Hong Kong resident whom the U.S. indicted in September for allegedly helping send controlled U.S. dual-use microelectronics to Russian end users -- was involved in this procurement network (see 2309190063).

The agency also sanctioned and named specific companies for illegally sending or receiving items listed on the BIS list of common high-priority items, including Russia-based limited liability company Mdikam Ek, which procured “multiple shipments” of the highest priority Tier 1 goods, including electronic integrated circuits. UAE-based Bliksem Computers & Requisites Trading Company LLC and Dream Lite Trading LLC have each sent multiple shipments of those high priority items to Russia, the agency added.

Along with the new sanctions, Treasury issued three new general licenses and one updated license to authorize certain transactions with sanctioned entities:

  • New General License No. 74 authorizes certain activities necessary to the wind down of transactions involving East-West United Bank and any entity it owns by 50% or more. The license also authorizes U.S. parties to reject, rather than block, and “return to the originator or originating financial institution or their successor-in-interest” certain transactions necessary to the processing of funds involving the bank. Those activities are authorized through 12:01 a.m. EST Jan. 31.
  • New General License No. 75 authorizes certain activities necessary to the divestment or transfer of debt and equity of Sistema, East-West United Bank, Limited Liability Company Arctic LNG 2 and any entity they own by 50% or more. Those transitions are authorized through 12:01 a.m. EST Jan. 31.
  • New General License No. 76 authorizes certain activities necessary to the wind down of transactions involving Sistema, the Saint Petersburg Stock Exchange, Limited Liability Company Arctic LNG 2 and any entity they own by 50% or more. Those transitions are authorized through 12:01 a.m. EST Jan. 31.
  • Updated General License No. 13G, which replaced 13F, authorizes certain transactions involving the Russian Federation's Central Bank, Wealth Fund and Ministry of Finance. Those transactions are also authorized through 12:01 a.m. EST Jan. 31. The license was set to expire Nov. 8.