The U.S. on March 24 announced another set of Russia blocking sanctions on more than 400 individuals and entities, including members of the Russian legislature, defense companies and their leadership, and additional Russian elites. The targets are "key enablers of the invasion" of Ukraine, the Treasury Department said, including Herman Gref, CEO of Sberbank and a close Putin associate. Other sanctions target additional bank executives and the entire Russian State Duma, including 328 members who support the war in Ukraine, the State Department said.
Ben Perkins
Ben Perkins, Assistant Editor, is a reporter with International Trade Today and its sister publications, Trade Law Daily and Export Compliance Daily, where he covers sanctions, court rulings, and other international trade issues. He previously worked as a trade analyst for a Washington D.C. advisory firm. Ben holds a B.A. in English from the University of New Hampshire and an M.A. in International Relations from American University. Ben joined the staff of Warren Communications News in 2022.
Even before new sanctions and export controls targeting Russia take full effect, many companies are deciding that compliance and due diligence costs are not worth the potential profits of continued business dealings in Russia and Belarus, former U.S. export control and sanctions officials said, speaking at a Washington International Trade Association panel on March 10.
President Joe Biden issued an executive order March 9 that will require several agencies to study how cryptocurrency can be used to evade sanctions. The order, part of a “priority effort” underway by the administration to counter illegal uses of virtual currencies, comes amid concerns from lawmakers that Russia could turn to cryptocurrency to evade U.S. and global financial restrictions (see 2203030047).
The Office of Foreign Assets Control issued more sanctions on Russian elites and their families who "provide direct and indirect support to the Government of the Russian Federation" by identifying certain property of these persons as blocked. The designees include Alisher Burhanovich Usmanov, Nikolay Burhanovich Tokarev, Yevgeniy Prigozhin, and their families. The sanctions were done "in close coordination with the European Union, United Kingdom, Canada, Japan, the ROK, and Australia," according to the OFAC annoucement.
Keeping pace with the multinational sanctions being imposed on Russia following the invasion of Ukraine has become a difficult but necessary task for lawyers and businesses, said sanctions and international trade lawyers at Crowell & Moring on a March 2 briefing hosted by the firm. The sanctions are already remarkably complex, totaling over 1,200 pages of new regulations, and more are expected. This marks the "fastest moving sanctions regime that we have seen," said Dj Wolff, a partner at the firm.
New U.S. sanctions and export controls against Russia could present significant additional compliance and due diligence requirements for companies operating in the region and more trade restrictions are likely on the way, law firms said.
The U.S. is imposing additional sanctions and new export controls following Russia's "further invasion of Ukraine," as promised by President Biden in his Feb. 22 speech (see 2202220003). The sanctions cover financial restrictions on Russian state-owned enterprises, banks, and individuals, while the export controls set restrictions on a variety of high-tech products. The new measures are part of an "unprecedented level of multilateral cooperation" according to the White House.
President Joe Biden announced in a speech Feb. 22 that the U.S. will impose a series of sanctions on Russia for its continued aggression against Ukraine. Biden promised sanctions "far beyond what was implemented in 2014," in response to Russian recognition of the Luhansk and Donetsk republics on Feb. 21, which he called a "flagrant violation of international law." According to a Feb. 21 press call, the White House anticipated the possibility and was prepared to respond immediately. A senior administration official noted the measures were in response to "Russia’s recognition gambit" and that they are distinct from "swift and severe economic measures" prepared should Russia "further invade Ukraine."
The Office of Foreign Assets Control is adding regulations to implement a pair of executive orders from November 2020 and June 2021 related to securities investments that finance Communist Chinese military companies. The regulations prohibit the purchase or sale of securities with any of the listed people or entities. In addition, the secretary of the treasury can designate further entities that have operated in the defense, surveillance, or related sectors of the Chinese economy.
The U.S. needs to more aggressively monitor transactions that aren't reported to the Committee on Foreign Investment in the U.S., said Nazak Nikakhtar, former acting head of the Bureau of Industry and Security. Nikakhtar, speaking during a Jan. 27 panel discussion hosted by China Tech Threat, said that the transfer of technologies to China, particularly semiconductor production equipment, has allowed it to outpace America in hypersonic missiles and has “placed the U.S. and the world in incredible jeopardy.”