Sanctions against Ukraine *Update*

The US Department of the Treasury’s Office of Foreign Assets Control (OFAC), in coordination with the European Union, has confirmed that as a result of Russia’s continued involvement in actions against Ukraine and a failure to meet its Geneva commitments, additional sanctions will be imposed on a number of individuals in the Russian leadership’s inner circle and 17 entities closely linked to previously sanctioned individuals.

It remains the case that the measures adopted in response to the crisis in the Ukraine target commercial dealings with designated entities and individuals. In contrast to the sanctions adopted against Syria and Iran, the measures adopted by the USA and EU against Russia do not currently seek to criminalise specific trades or the insurance and / or financing of such trades. Nonetheless Members will break  sanctions if they engage in commercial activity with any designated entity and P&I and FD&D cover will not respond to claims arising out of or connected with such activities. Members are therefore strongly advised to exercise due diligence to ensure that they do not enter into a commercial relationship with any designated entity.

Details of these recent changes to the Specially Designated Nationals and Blocked persons List can be found here.

26 March 2014 

In response to the continuing situation in the Ukraine and Crimea, the President of the United States has issued Executive Orders 13661 and 13662 – blocking property of additional persons contributing to the situation in Ukraine.

E.O.13661 expands on the scope of E.O.13660 by authorising sanctions on, among others, officials of the Russian government and any individual or entity that is owned or controlled by, has acted for or on behalf of, or has provided material or other support to, a senior Russian government official.

E.O.13662 further expands the scope of the previous E.O’s by authorising sanctions on individuals and entities that operate in key sectors of Russia’s economy. This includes the financial services, energy, materials, mining, engineering and defence and related material sectors and any individual or entity that is owned by or controlled by, has acted for or on behalf of, or has provided material or other support to sanctioned parties.  

The Executive Orders put in place the legal authority for the U.S. government through the Treasury Department’s Office of Foreign Assets Control (OFAC) to identify additional Specially Designated Nationals (SDNs). Currently OFAC has designated around 30 individuals and entities as SDNs, these include Russian and Ukrainian officials, members of President Putin’s inner circle and a Russian bank.

As some of the individuals targeted by these sanctions may own or control a number of companies, there is therefore a danger that these companies may then be considered a sanctioned entity. Therefore, Members are advised to conduct their own thorough due diligence checks to ensure that they have no dealings with designated entities or individuals.

Regular checks should be made on the U.S. Department of the Treasurywebsite for any additional sanctions and for the latest SDN lists.

14 March 2013 

The European Union, in response to the current situation in the Ukraine, has published EU Council Regulation 208/2014 imposing asset freezing sanctions against 18 named individuals connected with the former Yanukovich government. The named individuals have been identified as responsible for the misappropriation of state funds and those responsible for human rights violations.

A copy of the EU Council Regulation can be read here.

The United States Department of the Treasury, under Executive Order 13660, have also imposed sanctions blocking the property of certain persons contributing to the situation in Ukraine.

A copy of US E.O. 13660 can be read here.

Members are advised to contact the Club should they have any questions or concerns.