The Week in Review delivers the impact and analysis for the public, private, and non-profit sectors from our regular reporting of the evolving global sanctions campaign against Russia.

This week, we reviewed the recent developments since our last update on 6 May as the United States (U.S.), the European Union (EU), and the United Kingdom (UK) continue to lead a global coalition in this sanctions campaign. In light of the unprecedented depth, breadth, and complexity of multilateral sanctions already issued against Russia, countries are now focusing more on implementation rather than imposing new sanctions. Nevertheless, K2 Integrity will continue to monitor sanctions updates and provide insight into the meaning and potential outcomes of sanctions actions.

DOLFIN users can visit the updated Russia Sanctions page on DOLFIN to find additional resources and information on sanctions against Russia, including sanctions evasion typologies, case studies, and analysis on other sanctions programs implicating Russian actors, such the Global Magnitsky Sanctions Program Targeting Human Rights Violations and Corruption.

Recent Developments Related to Sanctions Against Russia

Since the last update, numerous authorities have undertaken sanctions-related actions against Russia.

U.S. actions include:

  • On 10 May, the Wall Street Journal reported that the United States is considering additional sanctions and export controls against Russia, according to Matthew Axelrod, a senior official at the U.S. Department of Commerce's Bureau of Industry and Security (BIS). Axelrod explained U.S. agencies are contemplating adding more restrictions on doing business with Russia, rather than just concentrating on enforcing the sanctions and controls that are already in place. He said sanctions have an immediate “bite,” while export controls cause shortages that compound over time. He added that allied countries are coordinating on the scope of export controls to impose and are also sharing information for enforcement.1 Speaking separately on 9 May, Deputy Secretary of the Treasury Wally Adeyemo stated that U.S. export controls have left two of Russia's major military tank production plants idle due to lack of foreign components.2
  • On 8 May, in an unusual sanctions designation announced on a Sunday, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed blocking sanctions on a number of individuals and entities supporting Russia's war efforts. OFAC blocked Moscow Industrial Bank and 10 of its subsidiaries; Promtekhnologiya, a state-supported weapons manufacturer; and three of Russia’s state-controlled television stations, including the most prominent propaganda channel, Channel One. OFAC also issued a determination pursuant to Executive Order (E.O.) 14071 prohibiting the export or supply by any U.S. person, wherever located, of accounting, trust and corporate formation, and management consulting services to any person located in Russia, with a small number of exceptions. The prohibition becomes effective on 7 June 2022. In parallel with the E.O., OFAC identified these same services as sectors targeted under E.O. 14024, meaning that OFAC can impose sanctions on any individual or entity determined to operate or have operated in any of those sectors.3

EU actions include:

  • On 8 May, Reuters reported that while a final deal is still in the works, the EU is moving towards a new, sixth round of sanctions that could include a ban on purchasing Russian oil.4 According to reporting, supplying landlocked member states Hungary, the Czech Republic, and Slovakia – all of which rely heavily on Russian oil – with alternative sources of energy has been a critical issue in the negotiations. Additionally, Bulgarian Deputy Prime Minister Assen Vassilev announced that his government would not support a new round of EU sanctions targeting Russian oil unless Bulgaria received an exemption.5 The Hungarian foreign minister also stated that Hungary would not support the EU oil embargo "as long as [the EU] does not provide a solution for Hungary's concerns."As part of this sixth package of sanctions the EU is also considering a prohibition on providing certain consulting and corporate formation services to persons in Russia, although the exact scope is yet to be defined.
  • On 6 May, the Italian Guardia di Finanza — Italy’s financial police — issued a press release announcing the freezing of a superyacht, the Scheherazade, linked to Russian President Vladimir Putin.The yacht was the subject of an investigation conducted by Russian opposition leader Alexei Navalny’s Anti-Corruption Foundation. While the Guardia di Finanza’s press release did not name Putin as the ultimate beneficial owner of the yacht, the Anti-Corruption Foundation’s head of investigations, Maria Pevchikh, believes there is “solid enough proof that Scheherazade belongs to Putin himself.”8

UK actions include:

  • On 9 May, the UK government announced planned trade sanctions that will target approximately GBP 1.7 billion (USD 2.1 billion) worth of trade. International Trade Secretary Anne-Marie Trevelyan and Chancellor of the Exchequer Rishi Sunak said the latest move includes additional tariffs on Russia's platinum and palladium exports, for which the UK is a major market, as well as outright bans on the export to Russia of certain materials such as chemicals, plastics, rubber, and machinery.9

Key Implications (Public, Private, and Non-Profit Sectors)

  • On 8 May, OFAC issued General Licenses (GLs) 33, 34, and 35.10 Among other things, GL 33 authorizes the winding down of operations or existing contracts involving the three blocked Russian TV stations, Channel One Russia, NTV Broadcasting Company, and TV Station Russia-1, or any entity in which they own a 50 percent or greater interest. GL 33 expires on 7 June 2022.11 GL 34 authorizes the winding down of accounting, trust and corporate formation, and management consulting services to any person in the Russian Federation that would otherwise be prohibited by E.O. 14071 and expires on 7 July 2022.12 GL 35 authorizes transactions involving credit rating and auditing services and expires on 20 August 2022.13 Although there is no explicit reference to credit rating and auditing services in the determination issued under E.O. 14071 or accompanying OFAQ FAQs, GL 35 suggests that they fall within the prohibited services.
  • The determination under E.O. 14071 that prohibits the export of the above-mentioned services to persons located in Russia excludes services provided to entities in Russia that are owned or controlled by U.S. persons or services in connection with the winding down or divestiture of an entity located in Russia that is not owned or controlled, directly or indirectly, by a Russian person.14 Nevertheless, there is now an increased risk that persons may be designated for operating in the aforementioned sectors, although OFAC clarified in FAQ 1037 that such designation is not automatic.15
  • OFAC’s prohibition of a wide variety of services and the accompanying discussions of implementing similar prohibitions on services provided by EU or UK persons will make it challenging for any person wishing to continue to operate in Russia, as they will have no access to these traditional types of services necessary to run businesses. This may trigger a new exodus of companies from Russia and place additional pressure on an orderly divestiture by Western companies of their holdings in Russia by accelerating the divestment timeline.
  • Persons that provide accounting, trust and corporate formation, and management consulting services — all of which OFAC defined very broadly — will need to carefully assess their customer base and existing contracts to understand what exposure, if any, they have to persons in Russia. Persons providing the aforementioned services should also update sanctions-related policies and procedures to account for new risks presented by the services prohibitions.
  • Going forward, OFAC will likely continue to make sectoral determinations under E.O. 14024 that permit it to designate individuals and entities operating in or having operated in to-be defined sectors of the Russian economy. In addition, OFAC will likely continue to make service determinations under E.O. 14071 that prohibit U.S. persons from providing a growing list of services. Such a dynamic makes it very challenging to engage in any business activities in Russia.


1 Expect More Russia Sanctions, Export Controls, Top U.S. Official Says (10 May 2022) https://www.wsj.com/articles/expect-more-russia-sanctions-export-controls-top-u-s-official-says-11652213094

2 Russia 'can't make more' tanks because of this key sanction, Biden official says (9 May 2022) https://finance.yahoo.com/news/russia-cant-make-more-tanks-because-of-this-key-sanction-biden-official-says-204705566.html

3 U.S. Treasury Takes Sweeping Action Against Russia’s War Efforts (8 May 2022) https://home.treasury.gov/news/press-releases/jy0771

4 EU edges towards oil sanctions on Russia, no deal yet (8 May 2022) https://www.reuters.com/business/energy/eu-edges-towards-oil-sanctions-russia-no-deal-yet-2022-05-08/

5 Bulgaria says will veto EU oil sanctions on Russia if it does not get derogation (8 May 2022) https://www.reuters.com/world/europe/bulgaria-says-will-veto-eu-oil-sanctions-russia-if-it-does-not-get-derogation-2022-05-08/

9 UK punishes Putin with new round of sanctions on £1.7 billion of goods (9 May 2022) https://www.gov.uk/government/news/uk-punishes-putin-with-new-round-of-sanctions-on-17-billion-of-goods

10 Russia-related Designations and Designations Updates; Issuance of Russia-related General Licenses, Publication of Russia-related Frequently Asked Questions (8 May 2022) https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20220508

11 GENERAL LICENSE NO. 33 (8 May 2022) https://home.treasury.gov/system/files/126/russia_gl33.pdf.

12 GENERAL LICENSE NO. 34 (8 May 2022) https://home.treasury.gov/system/files/126/russia_gl34.pdf.

13 GENERAL LICENSE NO. 35 (8 May 2022) https://home.treasury.gov/system/files/126/russia_gl35.pdf.

14 DETERMINATION PURSUANT TO SECTION 1(a)(ii) OF EXECUTIVE ORDER 14071 (8 May 2022) https://home.treasury.gov/system/files/126/determination_05082022_eo14071.pdf