Pillsbury Winthrop Shaw Pittman

Ukraine/Russia sanctions escalate

By Christopher R Wall, Stephan E Becker, Nancy A Fischer, Aaron R Hutman and Stephanie Rohrer

Sanctions have escalated at a rapid pace as western powers responded to the crisis in Ukraine and Russian’s annexation of Crimea. The US, European Union (EU), Canada and Australia have implemented sanctions. The approaches and specific sanctions lists of these four jurisdictions overlap but have certain key differences. Following are the current contours of these sanctions (through 23 March 2014).

US — has named 32 specially designated nationals (SDNs) under three new executive orders, including 31 individuals and one bank. Transactions with these SDNs are prohibited and their property is blocked, with no exception made for agreements or joint ventures established prior to the sanctions. The US also has instituted travel and visa bans for certain Russian and Ukrainian officials. Executive orders 13660 (6 March 2014), 13661 (16 March 2014) and 13662 (20 March 2014) have set up a framework to sanction persons disrupting democracy in Ukraine, Russian government officials, entities operating in the arms and related materiel sector in Russia and persons operating in particular economic sectors within Russia to be identified based on executive order 13662 (which may include the financial services, energy, metals and mining, engineering and defence industries).

EU — has frozen the assets of and banned travel for several Russian and Ukrainian officials under Council Regulations 208/2014 (5 March 2014) and 269/2014 (17 March 2014) and Implementing Regulation 284/2014 (21 March 2014). Unlike the US, the EU makes exceptions under certain conditions for payments due under contracts/obligations and certain arbitral decisions arising prior to the designation of the individual, for certain judicial/legal awards and for funds determined to be for basic needs, legal fees or service charges for frozen accounts…

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