US Actions on Russia and Russia-related Sanctions

The US has responded to the conflict in Ukraine with the following sanctions measures (listed by date, beginning with most recent). With relevant developments, we will update this post on a weekly basis.

The latest developments occurred on April 1 and April 6.

Additional jurisdictions we are tracking include: EU, Japan, Republic of Korea and UK.

April 21, 2022: President Biden issued a proclamation prohibiting Russian-affiliated vessels from entering US ports. Under the proclamation a “Russian-affiliated vessel” means:

1. Vessels under Russian registry, i.e. Russian flagged vessels;
2. Russian-owned vessels, i.e. the Russian government or a Russian company, citizen or permanent resident appears as the legal title owner on the vessel’s registration documents; or
3. Russian-operated vessels, i.e. a Russian company, citizen or permanent resident makes “the commercial decisions” regarding the employment of a ship, including how and where the vessel is employed.

There are two exceptions to the prohibition.

1. The prohibition does not apply to Russian-affiliated vessels “used in the transport of source material, special nuclear material, and nuclear byproduct material” for which and for as long as it is determined “no viable source of supply is available” without the use of such Russian-affiliated vessels.
2. Additionally, the prohibition does not apply to Russian-affiliated vessels seeking to enter a US port “due to force majeure, solely to allow seafarers of any nationality to disembark or embark for purposes of conducting crew changes, emergency medical care, or for other humanitarian need.”

The prohibition is effective April 28, 2022.

April 21: BIS issued a TDO, suspending the export privileges of Russian airline Aviastar for violating US export controls. The agency issued the 180-day TDO for the cargo aircraft carrier, which BIS noted, will limit the airline’s ability to deliver goods to Russia’s military, Under the TDO, Aviastar will be barred from participating in transactions with items subject to the Export Administration Regulations.

April 20, 2022: OFAC designated more than 40 people and entities, including Russian commercial bank Transkapitalbank, for involvement in attempts to evade sanctions.

OFAC stated Transkapitalbank has attempted to work with banks in the Middle East and Asia, including China, to evade international sanctions. Specifically, Transkapitalbank has offered it clients the ability to conduct transactions through its internet-based banking system, known as TKB Business, which OFAC characterized as operating as an alternative channel to the SWIFT network.

OFAC issued two new general licenses authorizing certain transactions with Transkapitalbank. One license covers wind down transactions, and the other general license covers for six months, certain transactions destined for or originating in Afghanistan in support of humanitarian efforts in the country.

OFAC also designated individuals and entities associated with a “sanctions evasion network” run by Russian oligarch Konstantin Malofeyev, who was charged earlier this month with violating US sanctions.

April 20: OFAC published guidance for holders of credit cards issued by sanctioned Russian financial institutions. OFAC confirmed U.S. operators of credit card systems are blocked from processing transactions involving certain sanctioned foreign financial institutions unless such transactions are exempted by OFAC. Foreign operators of credit card systems whose payment cards are issued by sanctioned banks also risk violating US sanctions if they allow those cards to be used in the US.

OFAC urged companies to take steps to ensure compliance, including requesting the Bank Identification Numbers of sanctioned banks, disabling those BINs from operation in the US, and requesting that non-US operators “prevent the use of payment cards issued by sanctioned foreign financial institutions in the United States at the network level.”

April 12, 2022: BIS published in the Federal Register a Final Rule amending the EAR to add four additional countries to the list of countries excluded from certain license requirements that were enacted to control the export, reexport, and transfer (in-country) of certain items destined for Russia. When BIS created the Russia/Belarus FDP rule and Russia/Belarus-Military End User FDP Rule, BIS created a list of countries for which those FDP rules did not apply, as those countries committed to implementing substantially similar export controls on Russia and Belarus.  This new Final Rule now adds Iceland, Liechtenstein, Norway, and Switzerland to Supp. No. 3 to part 746, as countries to which the Russia/Belarus FDP rule and Russia/Belarus-Military End User FDP rule do not apply.

April 12: BIS published a Final Rule that further expanded the licensing requirements for items destined to Russia or Belarus. In its initial rule from February 24, 2022, BIS imposed a license requirement on all items destined for Russia and classified under any ECCN in Categories 3 through 9 on the CCL.  This new Final Rule expanded the licensing requirement also to include items classified under any ECCN in Categories 0 through 2 on the CCL.  This Final Rule also revised the Russia/Belarus FDP rule to impose a license requirement on all items on the CCL.

The Final Rule revised paragraph (c) (License Exceptions) of § 746.8, to limit the availability of two paragraphs for certain Belarus-related aircraft under License Exception Aircraft, vessels and spacecraft (“AVS”).  As revised by this rule, paragraphs (a) and (b) of License Exception AVS are not available for aircraft registered in, owned, or controlled by, or under charter or lease by, Belarus or Russia, or by a Belarusian or Russian national.

April 9, 2022: BIS issued a final rule imposing “highly restrictive” license requirements on all Commerce Control List categories to Russia and Belarus. The move “expands U.S. scrutiny of transactions to almost any sensitive dual-use technology, software, or commodities that could be used to support Russia’s war effort.” BIS will apply a policy of denial to such license applications.

April 7, 2022:

• BIS issued three Temporary Denial Orders (TDOs) denying the export privileges of three Russian airlines: Aeroflot, Azur Air, and UTair. The TDOs were based on “ongoing export violations related to comprehensive export controls on Russia imposed by the Commerce Department.” The three TDOs function to terminate the right of the listed airlines “to participate in transactions subject to the Export Administration Regulations (EAR), including exports and reexports from the United States.” The TDOs are for a period of 180 days and may be renewed.
• Pursuant to EO 14024, OFAC designated Public Joint Stock Company Alrosa, the world’s largest diamond mining company. Additionally, the Department of State re-designated Joint Stock Company United Shipbuilding Corporation (USC), including 28 subsidiaries and eight board members.

April 6, 2022: President Biden issued Executive Order Prohibiting New Investment in and Certain Services to the Russian Federation in Response to Continued Russian Federation Aggression. The Executive Order prohibits the following:

• New investment in Russia by a US person, wherever located;
• The exportation, reexportation, sale, or supply, directly or indirectly, from the United States, or by a US person, wherever located, of any category of services as may be determined by the Secretary of the Treasury, in consultation with the Secretary of State, to any person located in Russia; and
• Any approval, financing, facilitation, or guarantee by a US person, wherever located, of a transaction by a foreign person where the transaction by that foreign person would be prohibited by this section if performed by a US person or within the United States.

The Executive Order did note, however, the prohibitions do not apply to “transactions for the conduct of the official business of the Federal Government or the United Nations.”

Also on April 6, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed full blocking sanctions on Sberbank and Alfa-Bank. Additionally, OFAC sanctioned family members of President Vladimir Putin, including his adult children, as well as family members of Foreign Minster Sergey Lavrov. Further, OFAC announced blocking sanctions on Russian Security Council members who are “complicit in the war against Ukraine.”

April 1, 2022: The US Department of Commerce’s Bureau of Industry and Security (BIS) added 120 entities under the destinations of Russia and Belarus to the Entity List. Ninety-five of the newly listed entities have received a Footnote 3 designation, which signifies that End-User Review Committee (ERC) has determined they are military end users in accordance with § 744.21 of the Export Administration Regulations (EAR) for “acquiring and attempting to acquire items subject to the EAR in support of Russia’s [or Belarus’s] military.”  The entities with a Footnote 3 designation are subject to the Russia/Belarus Military End User foreign direct product rule (the Russia/Belarus-MEU FDP rule) under § 734.9(g) of the EAR.

For purposes of this rule, a foreign-made item located outside the United States is subject to the EAR if (1) it is either the direct product of technology or software (regardless of origin) specified in any product group D or E Export Control Classification Number in any CCL category or the output of a plant or major component of a plant that itself is the direct product of such U.S.-origin technology or software; and (2) there is knowledge that (i) the item will be incorporated into or used in the production or development of any part, component, or equipment produced, purchased, or ordered by a Footnote 3 designated entity^[1] (i.e., a military end user on the Entity List under Russia), or (ii) a Footnote 3 designated entity is a party to any transaction^[2] involving the foreign-made item.^[3]  Foreign-made items subject to the EAR under the Russia/Belarus-MEU FDP rule are subject to the § 746.8(a)(3) license requirement without exception other than as specified in the particular Entity List entry for a Footnote 3 entity on the Entity List in Supplement No. 4 to part 744 of the EAR.

BIS added the other twenty-five newly listed entities to the Entity List solely on the basis § 744.11(b) of the EAR because the ERC determined that those entities are “for acquiring and attempting to acquire items subject to the EAR in support of Russia’s military modernization efforts.”

BIS will review all license applications for exports, reexports, or transfers (in-country) to these entities under a policy of denial, and no license exceptions are available.

[1] Id. § 734.9(g) n.3.

[2] A transaction party could be a purchaser, intermediate consignee, ultimate consignee, or end-user.  Id. § 734.9(g)(2)(ii).

[3] Id. § 734.9(g)(2).

March 31, 2022: The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed blocking sanctions on 21 entities and 13 individuals, pursuant to Executive Orders 14024 and 13694, as amended by Executive Order 13757. The table below includes the sanctioned individuals and entities and the basis for the designations.

Notably, OFAC sanctioned the largest Russian manufacturer and exporter of microelectronics (Joint Stock Company Mikron) and expanded its designation actions targeting Russia to include companies located in the UK, Spain, Singapore, Malta, France, and Finland.

In an important development that likely portends increased actions against entities outside Russia, OFAC also included explicit language in the press release announcing these actions regarding its derivative sanctions authority: “financial institutions and other persons that engage in certain transactions or activities with the sanctioned entities and individuals may expose themselves to sanctions.”

The Secretary of the Treasury also made a determination that makes operating in the aerospace, electronics, and marine sectors of the Russian economy sanctionable. Following that determination, OFAC may impose sanctions on any individual or entity it determines operates in the following sectors of the Russian economy:

• Technology
• Defenses and related material
• Financial services
• Aerospace
• Electronics
• Marine

March 24, 2022: The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued two amended general licenses and two new general licenses involving its Russia-related sanctions programs. OFAC also updated two Frequently Asked Questions to properly reference amended General License 17A in its guidance regarding the scope of that authorization.

• Russian Harmful Foreign Activities Sanctions Regulations General License 6A: General License 6 authorizes transactions related to the exportation or reexportation of agricultural commodities, medicine, medical devices to, from, or transiting Russia and certain COVID-19-related transactions. Amended General License 6A clarifies that the following transactions are not authorized:
  • Any debit to an account on the books of a US financial institution of the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation; or
  • Any transaction prohibited by Executive Orders 14066 or 14068 – the sanctions authorities that prohibit certain imports, exports, and new investment involving Russia.
• Russian Harmful Foreign Activities Sanctions Regulations General License 17A: General License 17 authorizes the importation into the United States of certain Russia-origin items otherwise prohibited by Executive Order 14068, pursuant to certain pre-existing written contracts, until March 25, 2022. Amended General License 17A extends the expiration date of the authorization with respect to Russian-origin fish, seafood, and preparations thereof, to June 23, 2022. It is important to note that the amended general license does not extend the authorization for importation of Russia-origin alcoholic beverages or non-industrial diamonds.
• Russian Harmful Foreign Activities Sanctions Regulations General License 20: Authorizes US persons to engage in transactions related to the official business of third-country diplomatic or consular missions in Russia that would otherwise be prohibited by Executive Order 14024 or section 1(a)(iv) of Executive Order 14068, which prohibits direct or indirectly supply of US dollar-denominated banknotes to the Government of Russia, or any person located in Russia.
• Executive Orders 13685 and 14065 General License 25: Authorizes transactions related to journalistic activities and establishment of news bureaus in the Crimea, the Donetsk People’s Republic, or Luhansk People’s Republic regions of Ukraine.
• Updates to Frequently Asked Questions 1,023 and 1,024: Clarifies the extended June 23 expiration date of General License 17A with respect to the importation of Russian-origin fish, seafood, and preparations thereof.

OFAC also announced its designation of “key enablers” of the Russian invasion of Ukraine. These designations include dozens of Russian defense companies, 328 members of the Russian State Duma, as well as the head of Sberbank, Russia’s largest financial institution. This action by OFAC brings US sanction more closely in line with measure taken by the European Union, United Kingdom, and Canada.

• Russian Defense Companies: As part of this sanctions package, OFAC designated 48 companies that are part of Russia’s “defense-industrial base.” These designations include Tactical Missiles Corporation JSC (translated abbreviation as KTRV) as well as KTRV’s General Director Boris Viktorovich Obnosov and 28 entities that are part of KTRV’s structure; JSC NPO High Precision Systems (High Precision Systems); NPK Tekhmash OAO (Tekhmash); Joint Stock Company Russian Helicopters (Russian Helicopters) and 15 subsidiary entities; and Joint Stock Company Kronshtadt (Kronshtadt).
• Russian Duma: Additionally, OFAC designated The State Duma of the Federal Assembly of the Russian Federation and 328 of its members for their support of President Putin’s invasion of Ukraine. OFAC noted such complicity included the ratification of treaties recognizing the so-called Donetsk People’s Republic and Luhansk People’s Republic. Today’s action supplements the March 11 designation of 12 members of the Russian State Duma who had advocated for Russia’s recognition of the breakaway Ukrainian regions.
• Sberbank: Today, OFAC also designated Herman Gref, the head of Sberbank and a known ally of Putin.

In addition to the above sanctions, OFAC also confirmed it issued new guidance in the form of Frequently Asked Questions to clarify that “any transaction involving gold related to the Central Bank of the Russian Federation is covered by existing sanctions.”

March 11, 2022: President Biden issued Executive Order (EO) 14068. The EO prohibited: (i) the importation into the US from Russia of  fish, seafood, and preparations thereof; alcoholic beverages; non-industrial diamonds; (ii) the exportation, reexportation, sale, or supply, directly or indirectly, from the US, or by a US person, wherever located, of certain luxury goods; (iii) new investment in any sector of the Russian economy as may be determined by the Secretary of the Treasury, in consultation with the Secretary of State, by a US person, wherever located; (iv) the exportation, reexportation, sale, or supply, directly or indirectly, from the US, or by a US person, wherever located, of US dollar-denominated banknotes to the Government of the Russian Federation or any person located in Russia; and (v) any approval, financing, facilitation, or guarantee by a US person, wherever located, of a transaction by a foreign person where the transaction by that foreign person would be prohibited by this section if performed by a US person or within the US.

On the same day, the US Department of Commerce’s Bureau of Industry and Security (BIS) imposed restrictions, implementing the EO, on the exports, reexports, and transfer (in-country) of luxury goods to all end users in Russia and Belarus and to certain Russian and Belarusian oligarchs.

March 8, 2022: President Biden issued EO 14066 banning the import of Russian crude oil and other petroleum, coal, and liquefied natural gas. The EO expands upon the scope of the national emergency declared in EO 14024 and extended in EO 14039. The order prohibits: (i) importation into the U.S. of Russian crude oil, petroleum, petroleum fuels, oils and products of their distillation, liquified gas; coal and coal products; (ii) new U.S. investment in Russia’s energy sector; (iii) Americans from financing or enabling foreign companies that are investing to produce energy in Russia; (iv) any transaction that evades or avoids the prohibitions set forth in the order; and (v) any conspiracy formed to violate the prohibitions set forth in the order.

March 6, 2022: In a Dear Colleague letter, House Speaker Pelosi confirmed that in addition to emergency funding to support Ukraine, the House is exploring legislation that would “ban the import of Russian oil and energy products into the US, repeal normal trade relations with Russia and Belarus, and take the first step to deny Russia access to the World Trade Organization.  [The House] would also empower the Executive branch to raise tariffs on Russian imports.”

March 4, 2022: The US Department of Commerce announced new actions related to Russia. The first added 91 new parties in 10 countries to the Entity List. The second expanded export controls on Russia’s oil refining sector.

OFAC published updated FAQs on Russia-related actions.

March 3, 2022: The White House announced the Office of Foreign Assets Control (OFAC) was coordinating with other US Government agencies to fully block the assets of 19 oligarchs and 47 family members. Additionally, the Department of the Treasury will share “financial intelligence and other evidence” with the Department of Justice to support criminal prosecutions and seizure of assets.

In the same announcement, the Biden Administration confirmed OFAC’s designation of seven Russian entities for disinformation, including SDN Strategic Culture Foundation and associated outlets Odna Rodyna, Rhythm of Eurasia, and Journal Kamerton; SouthFront; SDN InfoRos; New Eastern Outlook; Oriental Review; United World International; and Geopolitical. OFAC designated 26 Russia and Ukraine-based individuals with key roles in these organizations.

March 2, 2022: OFAC issued new guidance on its Russia sanctions. In part the issuance of the clarifications was in response to allegations the Russian government was using exporters as its agents in an effort to assist the country in propping up their currency and funding.

OFAC also issued frequently asked questions (FAQs) on several compliance issues, with a particular focus on prohibitions imposed under Directive 4 under Executive Order 14024, “Prohibitions Related to Transactions Involving the Central Bank of the Russian Federation, the National Wealth Fund of the Russian Federation, and the Ministry of Finance of the Russian Federation.”

BIS imposed on Belarus the export controls made effective on Russia on February 24, 2022. The action was in response to the Belarusian “substantial enabling” of Russia’s invasion of Ukraine. The rule imposes a policy of denial on sensitive items that support certain Belarusian industries, including defense, aerospace, and maritime. Additionally, the rule adds Belarus to the two new Foreign Direct Product rules (FDPR) placed on Russia, with a near total ban on exports of items to both Russian and Belarusian military end users. The rule further adds two entities, including the Ministry of Defence of the Republic of Belarus to the Entity List with a footnote 3 designation.

February 28, 2022: OFAC issued Russia-related Directive 4 under Executive Order 14024 and Russia-related General License 8A.

Additionally, OFAC added names to the Specially Designated Nationals list (SDN List) or updated names  on OFAC’s Non-SDN Menu Based Sanctions List pursuant to Executive Order 14024, Directive 4.

February 26, 2022: The European Commission, France, Germany, Italy, the UK, Canada, and the US issued a Joint Announcement on the imposition of further targeted sanctions against Russia, namely through removing Russian banks from the SWIFT banking system and imposing restrictive measures on the Russian Central Bank. Further coordination through a transatlantic task force has been agreed.

February 24, 2022: OFAC blocked four Russian financial institutions, VTB Bank, Otkritie, Novikom, and Sovcombank. OFAC issued general licenses concurrently with the sanctions on VTB Bank, Otkritie, and Sovcombank authorizing the following transactions and dealings otherwise prohibited by sanctions, including wind down transactions.

Additionally, OFAC imposed blocking sanctions pursuant to Executive Order 14024 on seven Russian “elites” and two real estate companies owned by a concurrently sanctioned VTB Bank executive.

OFAC also imposed correspondent account and payable-through account (CAPTA) sanctions and rejection sanctions on Sberbank, the largest Russian financial institution by assets. These sanctions do not block Sberbank, but prohibit U.S. financial institutions from maintaining or opening accounts, as well as processing transactions for the bank and its non-U.S. financial institution subsidiaries as of March 26, 2022.

OFAC also imposed new debt and new equity sanctions on a number of Russian entities, which similarly to existing restrictions under Directive 1 of Executive Order 13662, as amended, prohibit U.S. persons from dealings in new debt of longer than 14 days maturity or new equity of entities issued on or after March 26, 2022.

OFAC issued additional six general licenses authorizing the certain transactions otherwise prohibited by Executive Order 14024.

The G7 issued a statement affirming their response on severe and coordinated economic and financial sanctions.

The Department of Commerce Bureau of Industry and Security (BIS) implemented extensive new export control regulations on Russia and Russian-aligned regions of Ukraine. The measures include new Commerce Control List-based license requirements, new foreign direct product rules, an extended scope of Russia military end-use and end-user controls under Section 744.21, comprehensive export, reexport, and transfer (in-country) restrictions on DNR and LPR, and the addition of Russia to Country Group D:5.

Additionally, BIS transferred 45 Russian entities from the Military End-User List to the Entity List.

February 23, 2022: President Biden removed a national security waiver and imposed blocking sanctions on Nord Stream 2 AG and its CEO, Matthias Warnig. That action, in concert with the German declaration that it would cease certification, effectively prevents Nord Stream 2 from becoming operational. OFAC issued General License No. 4 authorizing certain “wind down” transactions involving Nord Stream 2 AG until March 2, 2022.

February 22, 2022: OFAC added VEB and PSB and 42 subsidiaries, five vessels, and three individuals to the SDN List.

OFAC also issued Russia-related Directive 1A under Executive Order 14024 to extend the prior primary market sovereign debt prohibitions to cover participation of U.S. financial institutions in the secondary market for bonds (ruble or non-ruble denominated) issued after March 1, 2022 by the Central Bank of the Russian Federation, the National

Wealth Fund of the Russian Federation, or the Ministry of Finance of the Russian Federation.

February 21, 2022: President Biden signed Executive Order 14065, which prohibits new investment in the DNR and LPR regions, importation into the US of goods, services, or technology from the DNR or LPR regions; exportation, reexportation, sale or supply from a U.S. person of goods, services, or technology to the DNR or LPR regions; and facilitation of the above transactions conducted by non-U.S. persons. The Department of the Treasury Office of Foreign Assets Control (OFAC) issued six General Licenses concurrently with the Executive Order authorizing certain transactions and dealing that would otherwise be prohibited.

Our related publications: 

Additional US, UK and EU Sanctions on Russia (March 2022)

The US, UK, and EU Impose a Series of New Targeted and Territorial Russia-Related Sanctions (February 2022)

Russia Sanctions Update: What Risk Management Steps Can Be Taken Now? (February 2022)

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