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Week ofMay 1, 2023
I. US SANCTIONS
- U.S. Announces Additional Security Assistance to
Ukraine: On May 3, the Biden administration announced that
it had authorizing the 37th drawdown of U.S. arms and
equipment for Ukraine, valued at $300 million. This security
assistance package includes additional ammunition for High Mobility
Artillery Rocket Systems, howitzers, artillery and tank ammunition,
anti-tank weapons, rockets, small arms and ammunition, trucks and
trailers to transport heavy equipment, and spare parts and other
field equipment.Read more>>andRead more>> - State Department Leads Joint Statement against IOC
Recommendations regarding Russian/Belarusian Athletes: On
May 4, the U.S. Department of State’s Assistant Secretary of
State for Educational and Cultural Affairs, together with the
ministers of sport or equivalent counterparts of Ukraine allies,
published a joint statement in response to the International
Olympic Committee (IOC)’s recommendations published on March
28, 2023, regarding the conditions for Russian/Belarusian athletes
and support personnel who are individually neutral to participate
in international sports competitions. The officials maintained that
Russia, which has broken the Olympic Truce twice, must not be
allowed to use sport to legitimize its invasion of Ukraine, and
highlighted outstanding concerns such as military connections of
athletes, state funding, definition of what constitutes teams, and
enforcement mechanisms.Read more>> - U.S. Presses for Release of Journalist in Russia on
World Press Freedom Day 2023: On May 3, on the occasion of
World Press Freedom Day 2023, the Biden administration, among other
things, once again called for the immediate release of Evan
Gershkovich, a Wall Street Journal reporter detained in
Russia for espionage charges. The Biden administration reiterated
that it is dedicated to protecting press freedom at home as well as
promoting it worldwide.Read more>>andRead more>> - Department of State Announces Reward Offers for Russian
Cybercriminal: On May 3, the Department of State announced
a reward offer of up to $10 million for information leading to the
arrest and/or conviction of Russian cybercriminal Denis
Gennadievich Kulkov, as well as a second reward offer of up to $1
million for information leading to the identification of key
leaders of the Try2Check transnational organized crime group.
Try2Check is a popular credit card checking services in the
cybercrime underworld which facilitated huge losses through credit
card fraud each year; and Kulkov, its founder, was charged with
access device fraud, computer intrusion and money laundering.Read more>>andRead more>> - Department of State Releases 2023 Annual Report on
International Parental Child Abduction: On May 2, the
Department of State submitted to Congress its 2023 Annual Report on
International Child Abduction, which cited 14 countries, including
Russia, as demonstrating a pattern of noncompliance to the Hague
Abduction Convention. The Department vows to continue to actively
work with all countries that are parties to the Convention to
encourage them to take more effective measures in resolving
international child abduction cases.Read more>>
II. EU SANCTIONS
- EU Commission Issues Guidance Note on Ensuring Food
Security through the Implementation of Firewalls: The EU
Commission published a guidance note detailing safeguards to
prevent designated persons from exercising control over the
non-designated EU entity so they can continue business operations
in the trade in agricultural and food product while keeping the
funds and economic resources owned by the designated person
frozen.Read more>> - EU Commission Presents Plan to Extend Its Sanctions
Regime to Target Foreign Nationals for Corruption
Offences: The EU High Representative supported by the EU
Commission presented a proposal, to establish a dedicated Common
Foreign and Security Policy (CFSP) sanctions regime to target
serious acts of corruption worldwide.Read more>> - EU Adopts a New Sanctions Framework to Target Actions
Aimed at Destabilising Moldova: The Council adopted a new
framework for targeted restrictive measures which provides the EU
with the possibility of imposing sanctions against persons
responsible for supporting or implementing actions which undermine
or threaten the sovereignty and independence of the Republic of
Moldova, as well as the country’s democracy, the rule of law,
stability, or security.Read more>> - EU Aims to Target Nations through Which Russia Evades
Sanctions: The European Union is discussing a new
sanctions mechanism to target third countries it believes
aren’t doing enough to prevent Russia from evading sanctions,
particularly those that can’t explain spikes in trade of key
goods or technologies.Read more>> - Bulgarian Government Investigated over Russia Sanctions
Implementation: The Bulgarian government is being
investigated for how it has implemented EU sanctions against
Russia.Read more>> - Czech Republic Imposes Sanctions on Patriarch Kirill
for Supporting Russian Invasion of Ukraine: The Czech
government has imposed sanctions on Patriarch Kirill, the head of
the Russian Orthodox Church, for his support of Russia’s
invasion of Ukraine. Kirill’s inclusion on the national
sanctions list means that any assets he has in Czechia will be
frozen, he is barred from entering the country, and cannot
undertake any financial transactions there.Read more>> - German ECJ Reference on Whether Notary Services
Infringe EU Russia Sanctions ‘Legal Services
Prohibition’: The Berlin Regional Court has made a
request in Case C-109/23 to the European Court of Justice for a
preliminary ruling on the EU’s restrictions on the provision of
legal services to entities established in Russia in Article 5n(2)
of Council Regulation (EU) No 833/2014.Read more>> - EU Justice Commissioner in Cyprus over
Sanctions: Didier Reynders, the EU Justice Commissioner
arrived in Nicosia on Thursday on a two-day visit to discuss with
the island’s officials the enforcement of European Union
sanctions on individuals and companies with ties to the Kremlin.Read more>> - Commission Adopts Exceptional and Temporary Preventive
Measures on Limited Imports from Ukraine: The European
Commission has today adopted exceptional and temporary preventive
measures on imports of a limited number of products from Ukraine
under the exceptional safeguard of the Autonomous Trade Measures
Regulation.Read more>> - Russian Spy Network Smuggles Sensitive EU Tech Despite
Sanctions: A Russian spy network has acquired sensitive
technology from EU companies to fuel Vladimir Putin’s war in
Ukraine even after a US-led crackdown on the covert smuggling ring
according to the Financial Times.Read more>> - Russian Tycoon Timchenko Tells Court Close Putin Ties
Don’t Mean He Supports Ukraine War: Russian
billionaire Gennady Timchenko, in a legal move to challenge EU
sanctions imposed on him over Russia’s aggression against
Ukraine, says his close ties with President Vladimir Putin do not
mean that he is allied with the Kremlin in its policy on Ukraine.Read more>> - Germany Raids Russian’s Superyacht in Sanctions
Probe: German authorities raided a luxury yacht belonging
to a wealthy Russian businessman as part of a probe into possible
breaches of Western sanctions imposed over Russia’s invasion of
Ukraine.Read more>> - Western Sanctions Harm Russian Aviation with Technical
Issues, Emergency Landings, and Pricey Tickets: There are
more technical problems and emergency landings due to an acute lack
of parts, maintenance and technical support. Passengers fly more
and more unsafely while ticket prices have increased between 15 and
30 percent.Read more>>
III. UK SANCTIONS
- Despite War, Sanctions, Russians in London Commercial
Courts Reach New Record: On May 4, 2023, the annual
Commercial Courts Report showed that a record number of Russians
have appeared in London’s Commercial Courts during 2022,
despite the war in Ukraine and global sanctions, while the number
of Ukrainian litigants sank to zero. The number of Russian
litigants in Commercial Court judgments jumped by 41% to 58 in the
year to March 2023, second only to 441 British litigants. The
report compiled data from 257 judgments, documenting amongst other
things 38 Russian individuals and 19 companies listed in the
judgments, including a case involving sanctioned Bank Otkritie and
the founder of the Museum of Russian Impressionism, Boris Mints.Read more>> - General Licence INT/2022/1710676 Amended: On
May 4, 2023, OFSI amended General Licence (GL) INT/2022/1710676
under regulation 64 of the Russia (Sanctions) (EU Exit) Regulations
2019 in relation to Evraz plc. The GL amended the definition of the
North American Subsidiaries, to clarify that Evraz North America
plc; Evraz Inc. NA; and Evraz Inc. NA – Canada, and their
subsidiary companies, are covered by the GL. Under the GL a Person
may continue business operations involving the North American
Subsidiaries including, but not limited to:
- Payments to or from the North American Subsidiaries under any
obligations or contracts; - Payments to or from any third party under any obligations or
contracts; and - Receipt of payments made by the North American Subsidiaries for
audit services.Read more>>
- Payments to or from the North American Subsidiaries under any
- UK General Licence for Russia & Belarus Legal Fees
Extended: On April 28. 2023, OFSI issued a new General
Licence (GL) INT/2023/2954852 under Regulation 64 of the Russia
(Sanctions) (EU Exit) Regulations 2019 and Regulation 32 of the
Republic of Belarus (Sanctions) (EU Exit) Regulations 2019.
Replacing expired GL INT/2022/2252300, the new GL INT/2023/2954852
authorises until 28 October 2023 the payment of legal fees by
people and entities designated under the Russia or Belarus
sanctions regimes to law firms and counsel. In summary the payment
for legal services is now authorised in relation to any matter,
except a claim for defamation or malicious falsehood. Like the
previous version of the licence, the GL distinguishes between legal
services commenced ‘pre-designation’ (Part A) and legal
services commenced ‘post-designation’ (Part B).- There is a £500,000 (inc. VAT) cap on the amount that can
be claimed for legal work carried out in satisfaction of a prior
obligation (e.g. where a law firm or barrister is engaged before
the designation of the person / entity), and a cap of 5% of the
legal fees (or £25,000) on expenses associated with the
provision of legal services. - There is a cap of £500,000 (inc. VAT) on overall fees for
legal work started post-designation and a cap of 5% of the legal
fees (or £25,000) on expenses associated with the provision
of legal services. The hourly rate charged by a ‘Legal
Advisor’ must not exceed those set out in the GL, and the
hourly rate for counsel must not exceed £1,500 (including
VAT).
- There is a £500,000 (inc. VAT) cap on the amount that can
The GL also permits the two legal
fees caps to be combined, subject to the terms of the licence being
met. Professional legal fees and expenses for cases involving
defamation or malicious falsehood are not permitted to be paid
under the GL.Read more>>andRead more>>
- OFSI Issues New General Licence
INT/2022/1679676: On April 27, 2023, OFSI issued a new
General Licence (GL) INT/2022/1679676 under Regulation 21 of the
Global Anti-Corruption Sanctions Regulations 2021 and Regulation 64
of the Russia (Sanctions) (EU Exit) Regulations 2019. Under the GL
an officer of a Non-Crown Relevant Organisation is permitted to
carry out their duties including through making use of powers
available to them under UK legislation or common law for Asset
Recovery Purposes. The GL also permits persons to carry out any
action necessary to comply with or otherwise give effect to any of
the following for asset recovery purposes: (i) a negotiated
settlement to which a Relevant Organisation is a party; or (ii) an
approved deferred prosecution agreement to which a Crown Relevant
Organisation is a party.Read more>>andRead more>>
IV. RUSSIA/UKRAINE SANCTIONS
- Ukraine’s Anti-Corruption Agency Designates
Hungary’s OTP Bank an “International Sponsor of
War”: The decision was made due to the bank’s
continued operations in Russia and adherence to a credit law
directly referring to the proxy regimes in Russian-occupied Donetsk
and Luhansk oblasts. OTP Bank is Hungary’s largest commercial
bank and one of the largest in Central and Eastern Europe.Read more>> - Russian Billionaires Line Up to Buy Yandex: On
May 4, 2023, it was reported several Russian billionaires are vying
to buy the majority stake in the domestic entity of splintered tech
giant Yandex. Russian sanctions have forced Yandex, once the crown
jewel of Russia’s tech sector, to split into two new companies:
one overseeing its operations in Russia and a second
Amsterdam-based firm that will focus on new technologies for the
international market.Read more>> - Russia Projected to Start Purchasing Chinese Yuan for
Its Foreign Reserves: On May 4, 2023, it was reported that
Russia will start to purchase Chinese yuan for its international
reserves. Analysts project that the purchases will be small and
symbolic in the beginning and will demonstrate a turnaround in the
Russian economy. The purchase of these funds in Chinese yuan will
help the country to keep piling up its reserves, which had been cut
by the seizures of more than $300 billion in assets as a result of
Western sanctions.Read more>> - Zelensky Criticizes Idea of ‘Hybrid’ Tribunal
During Speech at the Hague: Zelensky said the world
“should not refer to the shortcomings of the current
international law but make bold decisions” that would
correct them in order to receive “full” justice,
citing the Nuremberg trials as a precedent. “This is
exactly what the creators of Nuremberg did, and this is what we
should do now. It would be a weakness for Europe and for us and for
all nations to leave justice to history” Zelensky
added.Read more>> - Zelensky: ‘We Didn’t Attack Putin or
Moscow’: President Volodymyr Zelensky denied
Russia’s claims that the Kremlin residence of Russian President
Vladimir Putin was targeted by two Ukrainian drones overnight on
May 3. “We do not attack Putin or Moscow. We are fighting
on our territory, defending our villages and cities“
Zelensky said during the press conference in Finland.Read more>> - Ukraine Seeks to Join Trans-Pacific Trade
Pact: President Volodymyr Zelensky has approved the
delegation that will participate in negotiations on Ukraine’s
accession to the Comprehensive and Progressive Agreement for
Trans-Pacific Partnership (CPTPP). Economy Minister Yulia
Svyrydenko was appointed as head of the delegation. The Ministry of
Economy expects to join the Trans-Pacific Partnership Agreement in
early 2024. At the same time, there is a prospect of joining the
agreement this year. Currently, the members of the agreement
include Australia, Brunei, Canada, Chile, Malaysia, Mexico, Japan,
New Zealand, Peru, Singapore, and Vietnam.Read more>> - Zelensky Calls for Removal of EU Restrictions on
Ukrainian Food Exports: President Volodymyr Zelensky
called for the removal of what he termed the
“destructive” impact of bans of Ukrainian food
products by five EU members during a phone call with European
Council President Charles Michel. EU member states Poland,
Slovakia, Hungary, Romania and Bulgaria also on April 28 agreed to
restrictions of Ukrainian grain products as part of a deal with the
EU that replaced unilateral bans on imports each country had put in
place in response to plummeting domestic prices.Read more>> - Russian Gold Changes Its Destination: The main
destinations for Russian gold after Western sanctions were the UAE,
Hong Kong and Türkiye. After the restrictions of the G7
countries and the European Union regarding Russian gold, dozens of
little-known companies took up its sale. Sanctions prevent Russia
from sending gold to the vaults of leading banks such as JPMorgan
Chase & Co. and HSBC, as well as use the services of
Brink’s and Loomis, which occupy a dominant role in the
transportation of precious metals.Read more>> - Zelensky Announces Sanctions against Russian Companies
Working for the Military Industry: Ukraine is preparing a
new package of sanctions against individuals and legal entities
working for the Russian military industry. President Volodymyr
Zelensky stated this in his daily address to citizens.Read more>> - Moscow to Support Businesses & Employees Impacted
by Western Sanctions: On May 4, 2023, it was reported that
the Moscow government presented measures to support citizens and
businesses in the face of Western sanctions. The priority plan is
reported to include the preservation of jobs, ensuring the smooth
functioning of enterprises, import substitution and social support
for citizens, with other Russian regions soon expected to follow
suit. The Russian government and the Central Bank are developing
programs to subsidize interest rates on loans to refinance previous
obligations, replenish working capital and pay salaries for
enterprises that have pledged to keep jobs.Read more>> - Sberbank’s Tech Push Shows Russia’s Growing
Reliance on Its Top Bank: On May 4, 2023, it was reported
that Russian state-owned Sberbank has become one of the
country’s leading technology players by taking on an
increasingly important role as sanctions and exiting rivals create
gaps in the market. Sberbank’s image has been transformed under
CEO German Gref, who has overseen investments into artificial
intelligence, cloud services, big data and smart devices. Cementing
its banking credentials is Sberbank’s $530 billion in assets
and 107 million retail clients.Read more>> - Staging Partial Recovery, Russia’s April Car Sales
Leap: On May 4, 2023, analytical agency Autostat reported
that car sales in Russia leapt by 170.4% year-on-year in April.
Sales of new cars plunged by 59% in 2022 and Russia’s auto
industry had been heavily reliant on investment, equipment, and
parts from overseas and was hit hard by the fallout from Western
sanctions and the carmaker exodus. Autostat reported that 75,622
vehicles were sold in April 2023 compared to 27,965 in April 2022,
which was still down on the 150,000 units sold in April 2021.Read more>> - Wall Street Journal Profiles Tanker Companies Still
Willing to Sell Russian Oil: The Wall Street
Journal published a profile of George Economou, a Greek
shipping and transit magnate whose company, TMS, is one of the
leading companies still willing to move Russian oil to buyers
worldwide. The company has moved tens of millions of barrels since
the invasion of Ukraine, second only to Sovcomflot.Read more>> - Russian-US JV Scraps Plan to Build Large Gas Turbines
in Russia: On May 3, 2023, it was reported that a
Russian-U.S. joint venture between GE and Russian state energy
holding InterRAO has said it has abandoned plans to build
large-capacity gas turbines in Russia under license from General
Electric Co. The joint venture planned to produce its own medium
and large capacity gas turbines for power plants by 2025-26, making
90% of the components in Russia. The annual financial report from
the joint venture, Russian Gas Turbines, said “external
developments” had caused “significant changes to the
format and extent of General Electric’s involvement in joint
projects to localise gas turbine production, with unfavourable
consequences for the company”.Read more>>
V. OTHER NOTABLE DEVELOPMENTS
- Ukraine Allies Looking to Tackle Russia Sanctions
Loopholes and Tighten Net on Putin: On May 3,
Bloomberg reported that the U.S., Europe, and other key
allies of Ukraine are preparing fresh penalties against Russia to
try and tighten the net on President Putin’s economy, according
to people familiar with the matter. The plans, which will be
unveiled around a G7 leaders meeting in Japan later this month,
would be individually implemented but coordinated, aiming to close
loopholes in existing penalties and tackle overall sanctions
circumvention.Read more>> - Canada Sanctions Iranian Regime for Supporting Russian
Invasion of Ukraine: On May 3, Canada announced that it is
imposing additional sanctions on one entity and nine individuals
for their role in systematic human rights violations in Iran and
abroad. Specifically, the individuals listed included the senior
leadership of Paravar Pars, a key Iranian drone producer that is
supporting Russia’s invasion of Ukraine by supplying drones to
Moscow.Read more>> - New Zealand Increases Support to Ukraine, Further
Sanctions War Facilitators: On May 3, New Zealand
announced that it is significantly extending its defence
commitments as well as humanitarian, legal and economic support for
Ukraine. The package of measures included extending the deployment
of defence personnel to train and support the Ukrainian armed
forces; additional personnel to conduct space training programmes
for the Ukrainian armed forces; additional funding for the
provision of healthcare, food assistance, clean water, shelter,
humanitarian support to Ukrainian refugees, and ensuring legal
accountability and justice for victims in Ukraine. In addition, it
is also imposing sanctions on 18 entities and 9 individuals that
support Russia’s war against Ukraine, including the Russian
Federal Security Service (FSB) and its senior leaders, Russian
individuals and entities that facilitate Russia’s ability to
wage war, and Iranian individuals and entities that provide direct
military support to Moscow.Read more>> - Light Heavyweight Champion Not Eligible for Belt Due to
Russia Sanctions: On May 2, the World Boxing Council (WBC)
announced that Russian light heavyweight champion Dmitry Bivol is
not eligible to fight for the WBC title due to ongoing sanctions
for Russian and Belarusian fighters. Following Russia’s
invasion of Ukraine, the WBC, like other sanctioning bodies in the
sport, has chosen not to recognize champions or rank fighters from
Russia and Belarus.Read more>> - South Africa Allows Landing of Sanctioned Russian Plane
at Air Force Base: On May 4, The New York Times
reported that South African officials had allowed a cargo plane
sanctioned by U.S. for shipping weapons for Russia’s defense
forces to land at an air force base near the country’s capital
Pretoria last week, a move that could further increase tensions
with the U.S. South Africa’s Department of Defense said in a
statement that the plane had been delivering diplomatic mail for
the Russian embassy, but refused to say precisely what was loaded
on to and taken off the plane.Read more>> - South Africa Warns Putin Could Face Arrest While
Attending BRICS Summit: The South African authorities have
been attempting to dissuade Russian President Vladimir Putin from
attending the BRICS summit it is hosting in Gauteng in August over
fears that it would be compelled to arrest him following a warrant
for his arrest issued by the International Criminal Court in The
Hague in March. As South Africa has ratified the Rome Statute, the
main document governing the ICC, it is obliged to obey its
decisions, including arrest warrants for suspected war criminals.Read more>>
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