Sanctions - Four Years On: Navigating The Evolving Landscape

1. Overview
   1. Today marks the fourth anniversary of Russia's invasion of Ukraine and the widespread enforcement of sanctions by the EU, the US, the UK and other jurisdictions. Four years on, compliance obligations continue to intensify as the legal landscape evolves.
   2. EU Member States are currently working to agree on the 20th package of sanctions which is expected to be adopted shortly.
   3. Sanctions enforcement has escalated dramatically since February 2022.
   4. In the EU, Directive 2024/1226 which was adopted on 24 April 2024, and had a transposition deadline of 20 May 2025, has mandated criminal penalties across Member States for sanctions' violations. Greece transposed Directive 2024/1226 via Law 5232/2025.
2. Greece Criminalizes Sanctions Violations for Individuals and Legal Entities
   1. Law 5232/2025 criminalizes conduct that undermines the effective application of EU sanctions and introduces criminal liability for both individuals and legal entities. Such conduct includes:
   a. the release or the failure to freeze funds or economic resources belonging to sanctioned persons;
   b. facilitating the entry of sanctioned persons into EU territory;
   c. executing or continuing transactions with sanctioned entities;
   d. engaging in prohibited trade;
   e. providing financial services in breach of EU sanctions;
   f. circumventing sanctions, which includes among other things: concealing funds or providing false or misleading information and failing to comply with reporting requirements; and
   g. violating the conditions of licenses granted by authorities for activities that would otherwise be prohibited.
   2. Greek authorities are taking an increasingly active role in monitoring, investigating, and enforcing sanctions compliance. While only a small portion of these investigations is publicly known, it is clear that Greek authorities are following the lead of other EU Member States by focusing on investigating and prosecuting potential breaches and cooperating with foreign authorities such as the US Office of Foreign Assets Control (OFAC).
3. Russia Sanctions: A Refresher
   1. We set out below the key Russia-related sanctions measures most relevant to companies operating in the Greek market. This is not an exhaustive list and businesses with exposure to sanctions should obtain up to date legal advice before taking steps that may have legal consequences. The main instruments through which the EU imposes sanctions on Russia are Council Regulation (EU) No 269/2014 (as amended) (Regulation 269/2014) and Council Regulation (EU) No 833/2014 (as amended) (Regulation 833/2014).
   2. EU sanctions apply to EU persons (which include nationals of EU Member States and entities incorporated under those States' laws) wherever in the world they may be. They also apply within the territory of the EU and to any business done in whole or in part in the EU.
   3. Greece does not maintain an independent sanctions regime; it applies EU sanctions directly and has enacted national legislation to enforce EU sanctions.
   4. Dealings with Sanctioned Persons: It is prohibited to deal with funds or economic resources belonging to, or to make available funds or economic resources to sanctioned persons (both individuals and entities), including entities 50% or more owned or controlled by sanctioned persons. Sanctions are primarily targeted at individuals and entities based on their specific conduct rather than their nationality. Compliance in this area presents significant challenges, as corporate ownership structures are often opaque and can span multiple jurisdictions. Identifying the ultimate beneficial owners of a counterparty, and whether those owners are subject to sanctions, requires thorough due diligence, which may not always yield complete or reliable information. Determining whether a sanctioned person ultimately controls an entity, even without any actual shareholding in it, is an even more complex, fact-based exercise.
   5. Due diligence: EU operators must perform appropriate due diligence calibrated to the specificities of their business and their risk exposure. As the EU FAQs clarify, 'it is for each operator to develop, implement and routinely update an EU sanctions compliance programme that reflects their individual business models, geographic areas of operations and specificities and related risk-assessment regarding customers and staff'. Having robust compliance policies in place can serve as a mitigating factor in the event of a breach.
   6. Knowledge: Unlike the UK which operates a strict liability regime with respect to certain sanctions offences, the EU regime retains a 'reasonable cause to suspect' defense. However, the EU has clarified that the protection cannot be invoked where the operator has failed to conduct appropriate due diligence. Failing to conduct due diligence would not absolve an EU operator from liability for a sanctions breach arising from a transaction with a sanctioned person.
   7. Circumvention: The EU prohibits persons subject to EU sanctions to knowingly and intentionally participate in activities with the object or effect of circumventing sanctions. The offence of circumvention includes, among other things, participation in an activity without deliberately seeking to circumvent sanctions but being aware that such participation may have that object or effect and accepting that possibility. The EU has, and continues to, sanction individuals and entities for facilitating circumvention.
   8. Best Efforts: Natural and legal persons must use their best efforts to ensure that any entity they own or control established outside the EU does not participate in activities that undermine EU sanctions. Consequently, a Greek entity could be held liable for breaching EU sanctions if its non-EU subsidiary participates in prohibited conduct.
   9. Management and Trust Services: Alternative Investment Funds, can, depending on their structure, be caught by the EU's prohibitions relating to the provision of management and trust services. Where such entities are deemed to be providing 'management services' to a trust or 'similar legal arrangement' which has as a trustor or beneficiary:
   a. a Russian national (irrespective of whether that person resides in Russia);
   b. natural persons residing in Russia;
   c. legal entities established in Russia; or
   d. any entities owned, controlled or acting on behalf of any of the foregoing,
   the provision of such services may be prohibited.
   10. Professional Services: The EU's prohibition on the provision of professional services - including legal advisory, IT consultancy, accounting, auditing, advertising, tax consulting, business and management consulting, public relations services, construction, architectural, and engineering services - remains less restrictive than the UK's prohibitions. While the UK's prohibition extends to services provided to a 'person connected with Russia' which captures both individuals and legal entities, the EU prohibitions apply only where services are provided to legal persons, entities or bodies established in Russia (not individuals), or the Government of Russia.
   11. Reporting Requirements Relating to Flow of Funds: Legal persons, bodies and entities established in the EU whose proprietary rights are directly or indirectly owned more than 40% by:
   a. an entity established in Russia;
   b. a Russian national (including a dual citizen); or
   c. a natural person residing in Russia,
   must, as of 1 May 2024, report to the competent authority of the Member State where they are established within two weeks of the end of each quarter, any direct or indirect transfer of funds exceeding €100k out of the EU made during that quarter. Indirect transfers include those routed from an EU entity through one or more intermediaries within the EU before reaching a recipient outside the EU.
   12. Exports and Software: It is prohibited to sell, supply, transfer, or export, directly or indirectly, a broad range of goods and technology to any natural or legal person, entity, or body in Russia or for use in Russia. Notably, this prohibition encompasses an extensive range of software. For example, a Greek entity with an employee working remotely from Russia who can access and use from Russia the company's internal systems and software in the course of their work, may be engaging in a prohibited export of software. Similarly, it is prohibited to sell, supply, transfer, export or provide, directly or indirectly software for the management of enterprises and software with certain uses in the banking and financial sector to legal persons, entities or bodies established in Russia. As clarified by the EU, this covers software in intangible form including downloads from the cloud or transfers by email. The provision of technical and financial assistance and brokering services or other services related to the prohibited software is also prohibited.
   13. Crypto: It is prohibited to provide crypto-asset wallet, account, custody and other related services to Russian nationals, residents, or Russia-established entities. Since January 2024 it is also prohibited to allow such persons to own, control, or hold governing positions in EU-based crypto service providers. Additionally, transactions with specified non-EU crypto-asset service providers known to facilitate the export of restricted goods to Russia are banned.
   14. LNG: While EU restrictions with respect to LNG have existed for several years, the latest development is that, as of 25 April 2026, it will be prohibited to purchase, import or transfer, directly or indirectly LNG falling under CN code 2711 11 00 if it originates in Russia or is exported from Russia. For specific contracts concluded before 17 June 2025, the prohibition takes effect on 1 January 2027.
   15. Oil and Petroleum Products / Price Cap: The prohibitions relating to oil and petroleum products are extensive. Subject to certain exemptions, the EU has prohibited the import of seaborne crude oil and refined petroleum products from Russia. Further, the oil price cap imposed prohibits EU (and other) operators from providing certain services, including insurance, for the maritime transport of Russian-origin crude oil and petroleum products unless the oil is purchased at or below a specified price ceiling. The cap for seaborne crude oil is currently set at US$44.10 per barrel but is expected to decrease further, while a mechanism has been designed to ensure the cap remains 15% below the average market price over the previous six months. The EU is actively negotiating a proposal to replace the price cap with a full ban on maritime services such as insurance and transportation.
4. Reassessing Your Sanctions Exposure
   1. Member States' competent authorities can authorize otherwise prohibited activity by issuing authorizations or licenses specifying the exact terms under which a prohibited activity can be pursued by a specific party. Parties seeking to engage in such activity must apply to the relevant authority for approval.
   2. Further, while sanctions against Russia have dominated attention since 2022, sanctions regimes are much broader. Although the EU does not maintain comprehensive country-wide sanctions or economic embargoes like the US, it does maintain extensive targeted and list-based sanctions. Beyond Russia, the most significant regimes apply to: Iran, North Korea, Belarus (largely mirroring Russia sanctions in many respects), Syria, Crimea, and the oblasts of Donetsk, Kherson, Luhansk, and Zaporizhzhia.
5. Next Steps
   1. We actively monitor sanctions developments globally and provide strategic advice on their legal and operational impact. We have extensive experience in EU and international sanctions and can assist with any sanctions-related matters, including internal investigations, applications to sanctions authorities and the design and implementation of robust compliance systems and policies.

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.