EU foreign ministers have reaffirmed their commitment to continuing sanctions against Russia until it complies with its obligations under the Minsk peace agreements. The G7 nations also took this position when they met in May last year (see previous blog).
Speaking today, the EU’s High Representative Federica Mogherini said that although she “cannot say where the US administration stands on this…I can say where the Europeans stand on this”. Setting out the UK’s position, UK Foreign Secretary Boris Johnson stated that “The UK will be insisting that there is no case for the relaxation of the sanctions, every case for keeping up the pressure on Russia”.
OFAC has issued a general licence authorising US companies to request and pay for licences from Russia’s Federal Security Service (FSB) for the export of certain IT products to Russia. A link to the new licence is here.
The FSB is responsible for authorising the import of electronic goods with encryption functions into Russia. A prohibition on transacting with the FSB, imposed in response to Russia’s alleged involvement in hacking related to the US election, was therefore having the unintended consequence of preventing US companies from exporting certain IT products to Russia. The exports themselves must still be licenced by the Bureau of Industry and Security, and payments to the FSB for licences must not exceed $5,000 per annum.
In October 2016, UK bank NatWest informed state-owned Russian news channel RT (formerly Russia Today) that it would no longer be providing it with banking services in the UK. NatWest is now reported to have changed its position, following discussions with RT.
President Trump is due to speak to President Putin today, in their first call since Trump took office. It is being reported that lifting US sanctions may be on the agenda. When asked whether the leaders would discuss lifting US sanctions on Russia, senior aide to Trump Kellyanne Conway said that “All of this is under consideration”. There have also been reports that a member of Mr Trump’s team has drafted an executive order to lift sanctions on Russia.
The General Court of the EU has dismissed the annulment application brought by Almaz-Antey, a Russian defence firm, which challenged its listing on the EU’s sanctions that target people and entities responsible for undermining the territorial integrity of Ukraine. Case T-255/15 Joint-Stock Company ‘Almaz-Antey’ Air and Space Defence Corp v Council . This is the 2nd judgment interpreting the EU’s targeted Russia sanctions (the 1st being Rotenberg – see previous blog).
The EU’s reasons given for including Almaz-Antey in July 2014 are that it is a state owned company that manufactures weapons for the Russian army, an army which provides heavy weaponry to Ukrainian separatists used for shooting down aircraft. The Court rejected the applicant’s challenge to the proportionality of the listing criterion, finding that the EU had legitimately amended the criteria to include people / entities “materially or financially supporting actions which undermine or threaten the territorial integrity, sovereignty and independence of Ukraine”. And the Court held that it was legitimate to include the applicant on the basis of that criterion even though the evidence showed that it had not supplied weapons to Ukraine or for use there; it was enough that it was a state-owned company suppying weapons to the Russian army which itself supplies weapons to the separatists in Eastern Ukraine.
As is often the case, the Court rejected the applicant’s other arguments based on vague reasons, rights of defence and prorportionality, and ordered the applicant to pay the EU Council’s costs. There are interesting comments at paras 147-8 of the judgment about the Council’s use of press articles as evidence.
At his last press conference as President, Barack Obama commented on US sanctions on Russia and their possible future under Donald Trump. Responding to Trump’s suggestion that he may lift sanctions on Russia in return for their cooperation on nuclear disarmament, President Obama noted that the sanctions had been imposed because of Russia’s actions in Ukraine and that it would not be in the US’s interests to link them to the separate issue of nuclear disarmament. He reiterated his position, which is also that of the other G7 nations (see previous blog), that they should be lifted only if Russia ends its actions in Ukraine. A link to the full press conference transcript is here.
The EU has published a notice addressed to 50 people and 7 entities listed on its targeted Russia sanctions, saying that it intends to maintain their sanctions listings with new statements of reasons. The sanctions target people and entities said to be responsible for undermining the territorial integrity of Ukraine. The notice is here. The people affected may submit a request to the Council to obtain the intended statements of reasons for their designation before 23 January 2017, and at any time a request to the Council that the decision to include and maintain them on the list should be reconsidered. The next review is 7 February 2017.
President Obama has extended all US sanctions on Russia that were imposed in response to the Ukraine crisis by 1 year, until March 2018 (see notice here). The sanctions were due to expire had the President not renewed the national emergency first declared in respect of Russia’s actions in Ukraine in March 2014.
The leaders of the G7 countries have consistently stated that sanctions on Russia should continue until Russia complies with its obligations under the Minsk peace agreement (see previous blog). However, over the weekend President Elect Donald Trump raised the prospect of lifting sanctions against Russia sooner, saying that while he would keep sanctions against Russia in place “at least for a period of time…if you get along and if Russia is really helping us, why would anybody have sanctions if somebody’s doing some really great things?”. In particular, he appeared to tie lifting sanctions to an agreement from Russia to reduce its stockpile of nuclear arms. In November last year, Russia suspended nuclear cooperation between Russia and the US in response to the sanctions (see previous blog).