Ukraine update: EU, JP, CH, SG, UK, US sanctions against Russia
Global response

Ukraine update: EU, JP, CH, SG, UK, US sanctions against Russia

The shocking events in Ukraine continue. Sanctions in response to Russia’s actions are far-reaching. An overview of measures in key markets for AEB readers.

General information on measures against Russia

Many companies have stopped business activities with Russia or put business on hold for the time being. Anyone still seeking to do business with Russia, Belarus, or annexed regions in Ukraine needs to continuously verify if involved business partners are covered by latest sanctions, if payments can be received, and if shipments are actually possible at all.

The scope of sanctions that were imposed in response to the situation in Ukraine are extensive and reflect an extraordinary level of alignment and coordination among countries around the globe. In the next section of this article, we’re giving a short overview of measures with useful government links in key markets for AEB readers. But first, to best understand the scope of current restrictive measures, it helps to break them down into three main areas: 

  1. Financial sanctions: These include comprehensive bans on the provision of funds to listed individuals, entities, and companies.
  2. Goods-related sanctions: These include restrictions on trade with certain defined goods as well as services and financial resources that relate to such goods.
  3. Capital market restrictions: These include access restrictions to various capital markets for certain Russian financial institutions, organizations, the government, and the central bank.

Important note

The scope of current sanctions continues to change frequently in line with ongoing developments in Ukraine. It is therefore crucial for businesses to monitor relevant government updates to ensure compliance with latest restrictive measures.

In detail: Current EU, JP, CH, SG, UK, US sanctions

EU sanctions against Russia

EU restrictive measures in view of Russia’s actions destabilizing the situation in Ukraine are included in four Council Regulations:

  1. Council Regulation (EU) No 269/2014 of March 17, 2014
  2. Council Regulation (EU) No 692/2014 of June 23, 2014 (Crimea embargo)
  3. Council Regulation (EU) No 833/2014 of July 31, 2014. The consolidated text includes amendments in line with the following Council Regulations in 2014, 2015, 2017, 2019 and latest measures in 2022 from February 23, 2022, until (to date) March 15, 2022: EU consolidated text: Council Regulation (EU) No 833/2014
  4. Council Regulation (EU) No 2022/263 of February 23, 2022 (Donetsk, Luhansk)

EU restrictive measures in view of the situation in Belarus and the involvement of Belarus in the Russian aggression against Ukraine are included in Council Regulation (EC) No 765/2006 of May 18, 2006. The consolidated text includes amendments in line with listed Council Regulations from 2016 to March 9, 2022:

The EU has published useful infographics including links to further information and background details on current sanctions:

Also helpful for businesses: The Frequently Asked Questions on miscellaneous restrictions issued by the EU Commission concerning restrictive measures in view of Russia's actions destabilizing the situation in Ukraine:

Japan sanctions against Russia

Comprehensive restrictive measures against Russia, Belarus, and the regions of Luhansk and Donetsk have been implemented by Japan since February 24, 2022. These include financial measures, trade and other measures, and visa measures. 

The government of Japan maintains updated details on their website and the following links offer useful overviews:

Singapore sanctions against Russia

The Foreign Minister of Singapore announced intended sanctions on Russia on February 28, 2022, and details on the scope of measures in response to Russia’s invasion of Ukraine were released on March 5, 2022:

  • Export control measures include rejection of all permit applications for items on the list of military goods under the Strategic Goods Control Order (SGCO) 2021 as well as for items under categories 3 (electronics), 4 (computers), and 5 (telecommunications and “information security”) on the dual-use goods list under the SGCO.
  • Financial measures target designated Russian banks, entities, and activities in Russia, and fund-raising activities benefiting the Russian government. They also include prohibitions to facilitate transactions that could aid the circumvention of the financial measures for digital payment token service providers. All financial measures apply to all financial institutions in Singapore, including banks, finance companies, insurers, capital markets intermediaries, securities exchanges, and payment service providers.

More details are available in the official announcement of March 5, 2022, including fact sheet annex:

Switzerland sanctions against Russia

Aligning with EU measures and moving away from its usual policy of neutrality, Switzerland announced its first set of sanctions against Russia in response to the invasion of Ukraine on February 28, 2022. All following EU measures were adopted thereafter, except for the transport bans, as these are not deemed necessary for Switzerland due to its geographic location.

Amendments to the corresponding ordinances are underway. The Federal Department of Economic Affairs, Education and Research (EAER) has also imposed financial sanctions and travel restrictions on a further 200 individuals. With these measures, Switzerland’s sanctions are to date fully in line with those of the EU.

UK sanctions against Russia

EU regulations no longer apply in the United Kingdom and the new UK sanctions framework came into effect after Brexit. This included the “Russia (Sanctions) (EU Exit) Regulations 2019” and the “Republic of Belarus (Sanctions) (EU Exit) Regulations 2019 “, which came fully into force on December 31, 2020.

New restrictions have been added to these regulations since then, with several additions in 2022 based on this year’s events. The UK government has made guidance available on their website with useful overviews for traders. You can find key information in the following links:

US sanctions against Russia

On February 21, 2022, US President Joe Biden issued the Executive Order (EO) “Blocking Property of Certain Persons and Prohibiting Certain Transactions with Respect to Continued Russian Efforts to Undermine the Sovereignty and Territorial Integrity of Ukraine”. This measure expanded the scope of existing restrictive measures under various EOs of 2014 and 2018.

In addition to the new financial sanctions and capital market restrictions, item-related restrictions in line with §746.8(a)(1) of the Export Administrative Regulations (EAR) have also been tightened. Companies outside the US may be affected and should pay special heed to changes of “de minimis” calculations (§734.4; §746.8 (5) EAR). There are also two new Foreign-Direct Product Rules that must be considered (§734.9 (f) and (g); §746.8 (2-4) EAR) and all export license applications are subject to a license review policy of “presumption of denial”, which means that in most cases, the application will be denied.

A useful overview of US export controls imposed on Russia and Belarus has been prepared by the Bureau of Industry and Security (BIS) of the US Department of Commerce in form of an online country guidance for Russia-Belarus, which includes press releases, fact sheets & presentations, compliance and due diligence guidance and information, BIS contacts, enforcement resources, and regulations & legal resources. This page is regularly updated and should be consulted for latest updates on US measures in view of the situation in Ukraine:

Constant vigilance: Red flags in trade transactions

Unfortunately, even the strictest sanctions do not eradicate all criminal activities and workaround efforts. Export control experts therefore strongly recommend always keeping a watchful eye on red flags during trade transactions with business partners including suppliers, partners, customers, and prospects. It’s important to note that all departments of a company contribute to trade compliance – it’s a team effort that includes business units from purchasing and legal to sales, account management, and shipping.

Examples for red flags include but are not limited to:

  • Introducing new or alternative payment procedures
  • Ordering party differs from party making payment
  • Payment acceptance takes place via third party
  • Business sector seems unusual for requested items or services
  • Prospect has little-to-no online presence and is not listed in directories
  • Declining usual on-site assembly, installation, maintenance, and training
  • Quantity and performance capability is not proportionate to typical need
  • Requesting unusual packaging or payment terms
  • Special constructional demands that point to military end-use or ABC weapons

How software supports your trade compliance

Denied party screening forms an integral part of compliance with trade restrictions. Examples for sanctions lists include the US SDN list, the EU CFSP list, the UK sanctions list, the Switzerland SECO list, the Singapore MAS list, and the Japan MEU list – but there are many, many more on international and national level. Compliance Screening from AEB manages this demanding task for you securely and efficiently – and offers a wide range of lists in line with your individual requirements.

In addition, AEB's Export Controls and License Management applications help you comply with country embargoes, perform goods-related checks, and manage licenses. This ensures security and supports your trade compliance for all business processes from offer to delivery. With Risk Assessment, you can establish transparency, keep potential risks on screen, and enable informed decisions – while empowering all your business units to contribute and report suspicious transaction details.

Assistance for AEB customers

Are you already working with AEB trade compliance software? Our experts have summarized everything you need to know and the steps you need to take in the AEB Help Center.