Financial Crime World

US Exporters Face Complex Sanctions Landscape in Russia Following Invasion of Ukraine

In the wake of Russia’s invasion of Ukraine on February 24, 2022, the US has significantly expanded its sanctions and export controls on Russia, creating a complex landscape for US exporters to navigate.

The Current Sanctions Environment

The sanctions, which have been coordinated with European and Asian allies, include restrictions on payments, transportation, and logistics in/out of Russia. These actions have greatly complicated payments, while transportation and logistics have also become more complicated due to restrictions on air and maritime links.

Key Aspects of the Sanctions

  • Restrictions on payments: US exporters are advised to conduct transactional due diligence on all business involving Russia and Russian entities or individuals, given the substantial sanctions levied against the Russian banking and financial sector.
  • Transportation and logistics: The sanctions have complicated transportation and logistics, including restrictions on air and maritime links.
  • Export controls: In addition to OFAC sanctions, the Bureau of Industry and Security (BIS) imposes export controls on Russia, restricting the export, re-export, or transfer of items to Russia.

The US has imposed a range of sanctions, including those related to the Russian government’s harmful foreign activities, energy export pipelines, imports, exports, and new investment. The Department of the Treasury’s Office of Foreign Assets Control (OFAC) administers these sanctions, which include restrictions on certain transactions with Russian entities or individuals.

EO 14024: Blocking Property with Respect to Harmful Foreign Activities of the Russian Government

  • Date: April 15, 2021
  • Description: This Executive Order blocks property and interests in property of persons determined to be responsible for or complicit in actions undermining democratic processes or institutions in Ukraine.

EO 14039: Blocking Property with Respect to Russian Energy Export Pipelines

  • Date: August 20, 2021
  • Description: This Executive Order prohibits transactions involving the property and interests in property of persons operating in the energy sector of the Russian Federation.

Information on Economic Sanctions

The Department of the Treasury’s Office of Foreign Assets Control (OFAC) administers these sanctions, which include restrictions on certain transactions with Russian entities or individuals. The US has imposed a range of sanctions, including those related to the Russian government’s harmful foreign activities, energy export pipelines, imports, exports, and new investment.

Key Resources for US Exporters

  • Consolidated Screening List: A list of parties for which the US Government maintains restrictions on certain exports, reexports, or transfers of items.
  • OFAC sanctions search tool
  • FAQs
  • Recent Actions (not limited to Russia)
  • Reference Documents:
    • General License 6D of June 12, 2024 (exempting agricultural commodities and equipment/medicine/medical devices)
    • General License 13J of July 10, 2024 (authorizing certain administrative transactions such as taxes, licenses, fees, etc.)
    • July 2022 Fact Sheet on Preserving Agricultural Trade and Communication
    • Advisory for the Maritime Oil Industry and Related Sectors (October 12, 2023)
    • Guidance on Implementation of the Price Cap Policy for Crude Oil of Russian Federation Origin (Updated December 20, 2023)

Information on Export Controls

The Bureau of Industry and Security (BIS), part of the US Department of Commerce, also imposes export controls on Russia. These controls restrict the export, re-export, or transfer of items to Russia, including those related to national security, crime control, and foreign policy.

Key Resources for US Exporters

  • BIS Russia & Belarus - home page
  • Russian Industry Sector Sanction Lists
  • Request a BIS Advisory Opinion
  • BIS Lists of Parties of Concern: Denied Persons List, Entity List, Unverified List, Military End User List
  • Commerce/Treasury/Justice Tri-Seal Compliance Note
  • BIS Guidance to Prevent Evasion of Prioritized Harmonized System Codes to Russia (May 2023)
  • BIS Best Practice: Certification to Prevent Diversion to Russia of Highest Priority Items (September 2023)

State Department Resources

The US Government maintains restrictions on certain exports, reexports, or transfers of items. The list is a consolidation of multiple export screening lists from the Departments of Commerce, State, and the Treasury.

  • The Department of the Treasury expands the risk of secondary sanctions for foreign financial institutions by broadening the definition of Russia’s military-industrial base to include all persons blocked pursuant to E.O. 14024 (June 12, 2004)