Today, the EU adopted its 16th package of economic and individual restrictive measures against Russia, marking three years since the full-scale invasion of Ukraine. This latest round of sanctions introduces significant compliance challenges for financial institutions, service providers, and businesses operating within the EU and beyond. Below are the key highlights.
– Expanded Individual Listings: 83 additional individuals and entities have been sanctioned, including those supporting Russia’s military-industrial complex and those linked to its “shadow fleet.”
– Sanctions on the Shadow Fleet: The EU has targeted vessels circumventing the oil price cap or involved in transporting military equipment and stolen Ukrainian grain. This raises due diligence obligations for shipping, energy, and financial sectors.
– Financial and Banking Sector Restrictions: A landmark move sees the EU imposing a transaction ban on non-Russian financial institutions using the Central Bank of Russia’s SPFS system, a SWIFT alternative. Additionally, 13 regional Russian banks face new restrictions, reinforcing financial isolation.
– Stronger Trade Controls: 53 new entities, including those in China, India, Türkiye, and the UAE, are now subject to export restrictions due to their role in circumventing sanctions or supplying sensitive technology for military use.
– Broader AML and Compliance Implications:
- New Due Diligence Obligations: EU businesses must now implement stricter due diligence measures when selling sensitive goods to non-partner countries, reducing the risk of re-exports to Russia.
- Service Prohibitions: New restrictions target services such as accounting, legal advisory, IT consulting, and market research in Russian-controlled regions of Ukraine.
- Crypto and Financial Sector Risks: Belarus sanctions mirror those on Russia, extending compliance obligations for institutions handling cross-border financial transactions.
MK Compliance Limited can provide daily/weekly/monthly updates on sanctions, and AML regulatory developments. These updates ensure that you are kept informed about the latest regulatory changes, therefore ensuring comprehensive compliance.
In addition, we provide sanctions-related consulting services, including legal opinions, transaction reviews, screenings and background checks on your clients and related individuals/entities/counterparties, to ensure your business operations remain fully compliant with all applicable sanctions, mitigating the risk of breaches.
The content of this article is valid as at the date of its first publication. It is intended to provide a general guide to the subject matter and does not constitute legal advice. We recommend that you seek professional advice on your specific matter before acting on any information provided.
For further information or advice, please contact info@compliancemk.com.
