Ukraine sanctions warning in Russian election process

Petro Poroshenko.jpgUkraine President Petro Poroshenko has said that Ukraine will not recognise the “fake presidential elections” in the Russian occupied areas of Ukraine, and that sanctions will be imposed against those involved in the organisation of the electoral process. He has called upon the EU to take similar action.

EU continues Russia “territorial integrity” sanctions

EU6.jpgThe EU has prolonged its sanctions on Russia for “actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine” for a further 6 months, until 15 September 2018. These measures consist of asset freezes and travels restrictions on 150 people and 38 entities. See Council Decision (CFSP) 2018/392 and Council Implementing Regulation (EU) 2018/388. EU press release here.

Last week, the EU extended until 6 March 2019 its asset freezes on 13 individuals “responsible for the misappropriation of Ukrainian state funds or for the abuse of office causing a loss to Ukrainian public funds” (see previous blog here).

EU & US extend Russia-Ukraine sanctions by 1 year

Ukraine-Russia.jpgToday, the EU extended until 6 March 2019 the asset freezes against 13 individuals “responsible for the misappropriation of Ukrainian state funds or for the abuse of office causing a loss to Ukrainian public funds”. Two people were also removed from the list: Olena Leonidivna Lukash and Serhii Petrovych Kliuiev. See Council Decision (CFSP) 2018/333 and Council Implementing Regulation (EU) 2018/326. EU press release here, and UK OFSI Notice here.

Last week, the US decided to extend its Russia-Ukraine sanctions for another year, namely, the measures adopted under Executive Orders 13660, 13661, 13662 and 13685. White House press release here.

Ukraine continues sanctions against 4 subsidiaries of Russian state-owned banks

Ukraine2.jpgUkrainian President Petro Poroshenko has signed Decree No 57/2018 into law, which continues sanctions for another year against 4 Ukrainian subsidiaries of Russian state-owned banks (Sberbank Public Joint Stock Company, Joint Stock Commercial Industrial-Investment Bank, PJSC VTB Bank and PJSC BM Bank). The sanctions – which were first imposed in March 2017 – prevent capital from being withdrawn from the 4 entities outside of Ukraine. Links here for the Ukrainian President press release and an announcement from the Press Secretary of the Ukrainian President.

Klyuyev’s 2017 EU re-listing annulled

CJEU1.pngThe EU General Court has annulled the 2017 listing of Sergiy Klyuyev on its Ukraine misappropriation sanctions. He is a member of the Ukrainian Parliament and brother of the former head of the Presidential Administration of Ukraine, Andriy Klyuyev. Judgment here: Sergiy Klyuyev v Council T-731/15 (21 February 2018). The Court declined to annul his 2015 – 2016 re-listings, although he won an earlier case annulling his original listing (see previous blog).

His 2017 re-listing was annulled because the Council had provided no evidence to support the designation of Andriy Klyuyev, with whom the applicant was identified as being ‘associated’, and had not taken into account the applicant’s evidence (including that he was no longer the subject of pre-trial investigation in Ukraine). The Council should have made further enquiries of the Ukrainian authorities, since the evidence gave rise to doubts about the reliability of the Council’s information. The judgment contains interesting comments about the purpose and interpretation of the EU’s Ukraine sanctions regime.

New US Russia designations

US Treasury BuildingOFAC has designated 21 people and 9 entities, and added 12 entities to its Russia / Ukraine Sectoral Sanctions Identification List.

These measures were taken to “maintain sanctions pressure on Russia until it fully implements its commitments under the Minsk agreements” and to underscore the “US government’s opposition to Russia’s occupation of Crimea”.

11 people were designated pursuant to EO 13660 for being “Ukrainian separatists… responsible for or complicit in, or having engaged in, directly or indirectly, actions or policies that threaten the peace, security, stability, sovereignty, or territorial integrity of Ukraine; or for asserting governmental authority over a part or region of Ukraine without the authorization of the Government of Ukraine”. Pursuant to the same EO, OFAC also designated 3 people and 4 entities “who have supported the illicit coal trade from [Ukraine]”.

4 people and 2 entities were designated pursuant to EO 13661, which authorises sanctions against (inter alia) officials of the Russian government and any individual or entity that has acted for or on behalf of, or supported, an individual or entity previously designated under this EO.

1 construction company and 2 associated people were designated pursuant to EO 13685, which authorises sanctions against (inter alia) any person determined to operate in the Crimea region of Ukraine. Under the same EO, OFAC also designated 1 person and 2 entities “related to Russia’s transfer of four turbines made by a Russian-German joint venture to Crimea”.

OFAC also identified 12 subsidiaries that are 50% or more owned by Surgutneftegaz, an entity which was added to the Sectoral Sanctions Identification List (SSI List) in September 2014 under Directive 4.  The subsidiaries are subject to the same restrictions as their parent.  See OFAC’s revised guidance on Entities Owned by Persons Whose Property and Interests in Property Are Blocked (50% Rule). Links here for OFAC Notice and US Treasury press release.

Siemens appeals against Russian ruling refusing injunction against Crimean turbines

SiemensThe Moscow Arbitration Court has refused to grant injunctive relief in an action by Siemens Gas Turbines Technologies LLC (SGTT) against Technopromexport LLC and Technopromexport VO OJSC (subsidiaries of Russian state conglomerate Rostec) in respect of power turbines illegally diverted to Russia-annexed Crimea in mid-2017 (in violation of EU sanctions). As part of its claim, SGTT sought an injunction preventing the turbines from being installed in Crimea. SGTT has now appealed against the ruling (papers filed at Moscow’s Ninth Arbitration Appeals Court).

In December 2017, the Moscow Arbitration Court had dismissed a similar action by Siemens AG (a parent company of SGTT) for the seizure of the power turbines (see previous blog here).


OFAC designates ‘Thieves-in-Law’ Eurasian criminal organisation and its supporters

Logo_of_the_U.S._Office_of_Foreign_Assets_Control_(OFAC)OFAC has designated ‘Thieves-in-Law’, a “Eurasian criminal entity”, along with 10 individuals and 2 entities allegedly linked to the organisation (asset freezes imposed). The designations were made pursuant to Executive Order 13581, which targets significant transnational criminal organisations and their supporters.

In addition, OFAC has deleted 26 entries from its SDN list. Links here for the OFAC Notice and the US Treasury press release.