Major Sanctions Developments
Switzerland Adopts EU Sanctions Against Russia. Switzerland’s Federal Council has adopted the European Union’s package of additional sanctions against Russia amid Moscow’s invasion of Ukraine. Bern will stop the exportation of goods and services in the oil sector and will halt transactions with the Russian Central Bank. According to the announcement, Switzerland will also stop the exportation of dual-use items to Russia, as well as the delivery of goods that could support military and technological enhancement for the Kremlin’s defense and security sector. Additionally, on 4 March, reports indicated that the Swiss government is prepared to seize Russian cryptocurrency assets located in Switzerland.
South Korea to Cease Transactions with Russian Central Bank. The South Korean government is planning to suspend transactions with Russia’s central bank, joining global sanctions targeting Moscow for its invasion of Ukraine. With the decision, South Korea will join multinational sanctions against Russia, including export controls and the removal of Moscow from the Society for Worldwide Interbank Financial Telecommunications (SWIFT) global payment system. The government in Seoul said it will announce further details after consulting with related government agencies.
Singapore Launches Sanctions Against Russia. Singapore has imposed its own sanctions and restrictions aimed at constraining Russia’s capacity to conduct war against Ukraine. In a statement, the Ministry of Foreign Affairs of Singapore announced that the city-state is imposing export controls on items that can be directly used as weapons to “inflict harm on or to subjugate the Ukrainians, as well as items that can contribute to offensive cyber operations.” Singapore has also imposed financial measures targeting Russian banks and other entities while preventing digital payment token service providers from facilitating transactions that could help Moscow circumvent international economic sanctions. According to the statement, Russia’s invasion of Ukraine contravenes the UN Charter and because “the UNSC resolution to condemn Russia’s aggression against Ukraine failed to pass due to Russia’s veto,” Singapore opted to implement its own sanctions.
Export Controls
U.S. Commerce Department Takes Further Actions Targeting Russia’s Oil Sector, Supporting Entities. The U.S. Bureau of Industry and Security (BIS) has announced new actions against Russia in response to Moscow’s military actions in Ukraine. The restrictive measures apply to Russia’s oil refining sector and impose new stringent export controls. The actions build on existing restrictions the BIS put in place on the Russian deep-water oil and gas exploration and extraction industries in 2014, and also add 91 entities in 10 countries to the Commerce Department’s Entity List for their supporting role in Russian military activities. These entities are located in Russia (81), United Kingdom (3), Estonia (3), Spain (2), Malta (2), Kazakhstan (1), Latvia (1), Belize (1), Singapore (1), and Slovakia (1).
South Korea Hits Belarus with Export Bans for Supporting Russia. South Korea’s Ministry of Foreign Affairs has implemented export controls against Belarus for its role in Russia’s invasion of Ukraine. In a statement, the foreign minister said the South Korean government opted to implement the controls based on the judgment that Belarus is “effectively supporting Russia’s military actions in Ukraine” and comes as the United States and other countries impose sweeping restrictions against Minsk. The measures, which take effect today, will prohibit the export of strategic materials to Belarus and add the Belarusian Defense Ministry to its export blacklist.
Sanctions Effects and Enforcement
Italian Authorities Seize Yachts, Villas Owned by Russian Oligarchs. According to reporting from The Guardian, Italian law enforcement have seized yachts and villas of four prominent Russian oligarchs who were recently designated by the European Union. The property belonged to:
- Alexei Mordashov, the chairman of Russian state-owned steel and mining giant Severstal;
- Gennady Timchenko, longtime Putin associate, alleged “custodian” for Putin’s personal wealth, and owner of private investment group Volga Group;
- Alisher Usmanov, former co-owner of Premier League clubs Arsenal and Everton (and former owner of a mega-yacht that was recently seized in Germany) who was also designated by the United States on March 3 and European Union on February 28; and
- Vladimir Soloviev, a Russian state television host.
Multinational Corporations Continue to Sever Ties with Russia.
- On 4 March, Microsoft announced that it has suspended product and service sales in Russia.
- On 5 March, Visa and Mastercard announced that they would suspend operations in Russia. The process of doing so will take several days, after which transactions by Visa cards issued in Russia will no longer work outside the country, and cards issued elsewhere in the world will not work within Russia. Mastercard has been less clear as to what the restrictions will entail.
- On 5 March, PayPal announced that it will suspend services in Russia, as did Samsung and clothing retailer Zara.
- On 6 March, Netflix and Tiktok both announced cuts to their services in Russia. PwC and KPMG severed ties with their Russian businesses on the same day, meaning their Russian operations will continue to operate as a standalone firm with no links to the global brand.
Sanctions Outlook
United States and Allies Consider Ban on Russian Oil Imports. U.S. Secretary of State Antony Blinken said he was discussing a ban on imports of Russian oil with allies and U.S. President Joe Biden. Prices of oil and wholesale natural gas surged on Monday as a result, the former reaching USD 139 a barrel, its highest level since the 2008 financial crisis, while gas futures jumped to a record high of EUR 335 a megawatt hour, up from a price of around EUR 193 on Friday and EUR 16 a year ago.
UK to Strengthen Measures Against Russian Elites in New Sanction Revisions. The United Kingdom has issued several amendments to the Economic Crime Transparency and Enforcement Bill, targeting corrupt elites associated with the Russian government and increasing pressure on President Vladimir Putin’s regime. The first amendments will allow the UK government to streamline tighter restrictions against oligarchs and businesses tied to the Kremlin. As Foreign Secretary Liz Truss noted, the amendments will allow the UK “to go faster and harder on those closest to Putin, including oligarchs, as we continue to ratchet pressure in the face of illegal and unprovoked Russian aggression.”
New Zealand Eyes New Sanctions Law Targeting Russia. New Zealand Prime Minister Jacinda Arden has unveiled plans to roll out a sanctions bill targeting Russia in response to its invasion of Ukraine. Arden said the legislation will target individuals and entities contributing to Russia’s economy and sectors that are strategically important to the Kremlin. The new sanctions will give the government authority to freeze Russian assets in New Zealand, prevent yachts, ships, or private jets of sanctioned Russian individuals from entering the country, and generally prevent New Zealand from becoming a haven for sanctioned Russian persons. The new bill also includes potential sanctions against Belarus for its complicity in the invasion. New Zealand has historically implemented sanctions approved by the United Nations Security Council, but, as Prime Minister Arden argued, “With Russia vetoing UN sanctions we must act ourselves to support Ukraine and our partners in opposition to this invasion.”
