Go Back

The US, UK and EU impose further sanctions on Russia

28 February 2022

On February 28th 2022 the US, UK, EU and other allied nations adopted additional sanctions and restrictive measures against Russia as it’s invasion of Ukraine continues. These coordinated actions put further stress on key Russian defense and financial sectors. 

On this date, under Executive Order (E.O.) 14024 the Office of Foreign Assets Control (OFAC) issued Directive 4, prohibiting the engagement in transactions of US persons with the Central Bank of Russia (CBR), Russian Ministry of Finance and National Wealth Fund of the RF. As a result of this directive, these institutions were added to OFAC’s Non-SDN Menu-Based Sanctions List (NS-MBS). These moves aim to undermine Russia’s ability to make use of it’s foreign currency reserves. Following the new restrictions, on this date, OFAC also issued a new General License (Number 8A) authorizing a number of energy-related transactions with the CBR. More information on this round of sanctions imposed by the US can be found here.

The UK also adopted additional sanctions and restrictive measures against Russia on February 28th. On this date, Russian VEB, Bank Otkritie and Sovcombank were added to the Consolidated List of Financial Sanctions Targets in the UK, therefore imposing full blocking sanctions on them. This measure ensured the asset freeze of these three major Russian financial institutions. The UK parliament also passed The Russia (Sanctions) (EU Exit) (Amendment) (No.2) Regulations 2022 (Amendment 2), expanding prohibitions on loans and credits as well as transferable securities and money market instruments. The new amendment added Regulation 17A that maps out the restrictions regarding the processing of sterling payments and corresponding banking relationships. Under this regulation (which will come into force on March 1st 2022), UK credit and/or financial institutions are prohibited from establishing or continuing correspondent banking relationships and from processing sterling payments to, from or via designated persons or with UK or non-UK credit or financial institutions owned or controlled by them. Currently, this regulation applies only to Russian Sberbank. The UK also imposed several new export controls and removed Russia as a permitted destination from several open general export licenses. More information on the measures implemented by the UK on February 28th can be found here.

The EU also adopted new restrictive measures targeting Russia on February 28th. The European Council imposed sanctions on an additional 26 Russian individuals and 1 Russian entity, including an asset freeze and a prohibition on making funds available to these new listed individuals and entity. In addition, the EU published an amendment regarding restrictions on transactions with the Russian Central Bank. More information on the measures implemented by the EU on February 28th can be found here.