On 27 June 2019, the Council of the European Union (EU) adopted Council Decision (CFSP) 2019/1108, extending the economic sanctions on Russia in response to Russia's actions destabilising the situation in Ukraine until 31 January 2020.
According to the Council's press release, the decision to prolong the sanctions followed the European Council meetings of 20 and 21 June 2019 during which Chancellor Merkel and President Macron provided an update on the state of the implementation of the Minsk agreements, i.e. the agreements between Ukraine and Russia to resolve the conflict in eastern Ukraine.
Since the implementation of the Minsk Agreements, which was foreseen to take place by 31 December 2015, has not yet happened, the European Council called to resume the negotiations in view of implementing the Minsk Agreements and adopting measures to rebuild the confidence among the parties. Against this backdrop, it decided to maintain the economic sanctions on Russia.
The measures, which are already in force since 31 July 2014 and have continuously been extended ever since, mainly target Russia's financial, energy and defence sectors and the area of dual-use goods. They include:
- Limited access to EU primary and secondary capital markets for five major Russian majority state-owned financial institutions and their majority-owned subsidiaries established outside of the EU, as well as three major Russian energy and three defence companies;
- An export and import ban on trade in arms;
- An export ban for dual-use goods for military use or military end users in Russia; and
- Restrictions on the supply of sensitive technologies and services that can be used for oil production and exploration.
In addition to said measures, the EU has imposed several other economic sanctions on Russia in response to the crisis in Ukraine, including:
- Individual restrictive measures such as asset freezes and visa bans on 170 individuals and 44 entities, which are in force until 15 September 2019; and
- Substantial restrictions on economic exchanges with the territory of Crimea and Sevastopol, in response to the illegal annexation of Crimea and Sevastopol, which are in force until 23 June 2020.
In light of the extensive prohibitions and restrictions that remain in place, EU and international companies doing business with Russian and Ukrainian partners should continue to exercise caution and undertake enhanced due diligence to ensure compliance with any applicable sanctions regulations.
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