EU adopts its 21st sanctions package against Russia

Below, we highlight some of the key additions in the EU's 21st sanctions package against Russia relevant to EU operators. Notably, these new sanctions primarily build on the existing sanctions framework from previous packages.

Banks and crypto operators

The EU has targeted the Russian financial sector with particular intensity: Over a hundred banks and major financial institutions have been targeted in the new sanctions package. 14 crypto-related service platforms (based in e.g. Georgia, Panama, the UAE, the Marshall Islands, Kyrgyzstan, and Belarus) have also been designated. In addition, the EU has introduced the possibility of a full third-country ban for crypto-asset services (not yet utilized) to deter hosting platforms from circumventing sanctions.

All of the above ultimately sends a strong signal to EU operators that outbound financial transactions should continue to be subject to thorough and risk-based due diligence and screenings.

Trade measures

New export bans have been introduced, targeting items used by Russia's military industry, including nickel powders and alloys used in jet engines, beryllium powders used in propellants, self-adhesive films and tapes for the aerospace and defence sectors, and aviation items specific to unmanned aerial vehicles (UAVs).

On the import side, bans have been introduced on goods generating significant revenue for Russia, including copper ores, nickel ores, lead ores, precious-metal ores, unwrought zinc, alkaline-earth metals, zinc oxides, chromium oxides, glassware, imitation pearls and car parts.

Oil price cap mechanism

The EU has introduced a pause on the automatic adjustment of the oil price cap mechanism. The principle of an oil price cap was introduced in the 18th sanctions package (not to be confused with the US oil price cap). With the 21st sanctions package, the automatic adjustment is suspended so that the current cap level remains in force until 15 July 2027. 

Although the oil price cap is now stabilised, the EU Commission has emphasized that it may be reviewed earlier in case of exceptional market developments.

Other energy- and transport-related measures

On top of the oil price cap amendments, other energy- and transport-related measures have also been imposed, e.g.:

• A notification obligation for the sale of LNG tankers, together with the possibility to introduce new restrictions on such sales to Russian citizens and companies;
• Bunkering and other services to the shadow fleet (41 more vessels added on top of the 632 already sanctioned, bringing the total to 673). Five bunkering vessels that have regularly refuelled already-designated tankers are also designated for the first time;
• Prohibition against providing LNG terminal services to any natural or legal person in Russia, or to any entity which is more than 50% owned, or controlled directly or indirectly, by a Russian citizen or by a legal person in Russia;
• Additional shadow fleet-related sanctions, including in relation to services and ship-to-ship transfers; and
• Refinery-specific sanctions in Russia, Belarus and Georgia (noting that the transaction ban on a Georgian refinery enters into force in six months).

Military industrial complex

The EU has furthermore targeted the Russian military industrial complex in a broad sense. Some of the most significant new measures include:

• 51 new entities are subject to tighter export controls pertaining to dual-use goods and technologies, including 24 in Russia and 27 in third countries: 14 in China (including 4 in Hong Kong), 4 in Türkiye, 3 in Kyrgyzstan, 2 in India, 2 in Kazakhstan, and 2 in the United Arab Emirates.
• 56 individual listings of individuals and specific companies suspected by the EU to be involved in the Russian military industrial complex, 37 of which linked to long-range drones such as their production or involvement in the supply chain.
• From an infrastructure perspective, a number of Russian ports and airports are also designated under the transaction ban.

Legal protection of EU operators

New measures strengthen legal protection for EU operators against abusive lawsuits used as retaliation for EU sanctions. These include the possibility for EU firms to sue their non-Russian contractual parties in the EU to recover damages, and a requirement for Member States not to recognise or enforce Russian court decisions linked to sanctions.

Belarus

As in previous packages, a number of measures imposed on Russia have been mirrored in the Belarus sanctions regime. 

Need more information?

Read the official press release of the EU Commission

The Danish Business Authority monitors sanctions developments. Read their newsletter on the 21st sanctions package (in Danish).

This newsletter is prepared for general information purposes only and does not constitute legal advice. Should you wish to discuss any of the topics covered or have questions specific to your business, please do not hesitate to contact one of our specialists.