The potential impact of the recently issued economic sanctions against Russia, Belarus and the Crimea, Donetsk and Luhansk regions, are highly client specific. Discussing this topic requires a general understanding of the scope, applicability and mechanics of the various economic sanctions issued by the EU (and also the UK and US) and their relevance to the client's specific business. This, in combination with the fast pace at which new sanctions are being issued, not only asks for a meticulous approach by our clients, but also by ourselves.
For any questions we kindly request everyone to reach out to Marnix Somsen, Marlies Heemskerk-de Waard and Angelique Groen-Boon.
The pace at which the EU have been issuing the recent economic sanctions against Russia, Belarus and the Crimea, Donetsk and Luhansk regions, has been unprecedented. As a result, companies have to navigate a complex web of rules and regulations to ensure compliance in a pace and of a magnitude we have not yet seen before.
This may leave the understandable impression that Russia should now be considered a comprehensively embargoed country making it practically impossible to engage in any ongoing or future transactions with a Russian nexus. However, at this moment and purely from an economic sanctions perspective this is not the case. Moreover, for various sectors, such as, for example, the food industry, there may even be compelling arguments to continue Russian operations. That being said, EU companies operating internationally will now more than ever have to closely review and may have to adjust their Russia-related operations to be in compliance with all fast-evolving applicable sanctions. In this regard, the recent call for enhanced supervision of compliance by Dutch companies with EU sanctions should also be taken into account.
In addition, companies continuing their operations in Russia should closely watch the developments regarding the introduction of criminal liability for complying with foreign sanctions. Earlier on, the Russian government has held off on this. However, the relevant bill may well be re-introduced and enacted. If and when that happens, EU companies may find themselves between a rock and a hard place and obligated to call back from Russia their EU employees in order to avoid putting them at risk of criminal prosecution.