The Situation In Ukraine: New US And EU Sanctions

Author:Mr Michael Zolandz, Randy Bregman, Edward Borovikov, Nadiya Nychay and Peter G. Feldman
Profession:Dentons
 
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As the events in Ukraine and Russia continue to unfold, the reaction by the US and the EU, including imposing sanctions, will impact individuals, businesses, and entire sectors. The recent events in Ukraine lead clients in every corner of the globe to seek our strategic guidance as the situation develops.

As a polycentric firm, with no headquarters, no dominant culture and no flag, and with partners throughout the world, including Russia, Ukraine and Central and Eastern Europe, Dentons is particularly well positioned to explain the nuances that surround every facet of these complicated developments to our clients.

We understand that in diplomatic disputes there is often much posturing, but not every threat leads to action. We also understand that headlines and news reports rarely capture the complexities that are vitally important to clients. Most importantly, in situations involving so many nationalities, much can be lost in translation. Fortunately, Dentons has partners who literally speak the language of every nation involved and we invite clients to take advantage of our offices in the region.

This client update contains an analysis of the policy issues arising from the current situation in Ukraine prepared by our Public Policy and Regulation team. We try to present the facts as they are known, and the potential ramifications of what might happen, without expressing any political view. We believe this is the best way to serve our clients.

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The US and the EU have each imposed a range of sanctions targeting individuals and one entity which are associated with the developments in Crimea and with political disruption in Ukraine.

The US has established a wide-ranging set of Ukraine-related sanctions. Via three Executive Orders, the US established a legal framework for sanctions on a broad array of individuals and entities determined to be contributing to the situation in Ukraine. To date, the US has imposed sanctions, including asset freezes and US visa bans, on senior officials of the former Yanukovych administration in Ukraine, several senior Russian government officials and one Russian bank. The US has not imposed broad sanctions on Russia as a country. The US sanctions authorized by the three Executive Orders do not establish or authorize a commercial embargo of Russia, nor do they restrict ordinary trade or investment - unless a prohibited party is involved. The European Union imposed targeted sanctions on 33 individuals in connection with the situation in Ukraine. The Council of the European Union, giving force to its Decision 2014/145/CFSP authorizing travel restrictions and the freezing of funds and economic resources of certain individuals believed to have been responsible for actions "which undermine or threaten the territorial integrity, sovereignty and independence of Ukraine" ("designated individuals"), adopted Council Regulation (EU) No 269/2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine. While Council Regulation (EU) No 269/2014 imposed sanctions on 21 individuals, Council Regulation (EU) No 284/2014 expanded the list of persons by 12, for a total of 33. The EU list of designated individuals does not include sanctions on legal entities or Russia as a country. The list of the designated individuals has been annexed to the Council Regulation 269/2014, as amended by Council Regulation 284/2014. This list is an open list, which means that it can be expanded in the future. Given the pace of ongoing political, diplomatic, military and commercial events on the ground, and continuing negotiations between and among the EU, Russia, Ukraine, and the US, active monitoring of the sanctions landscape is particularly critical. Additional or enhanced sanctions can be imposed by the US or EU, without any further advance notification under the authorities currently in use.

US SANCTIONS

The US has established a new legal framework for the imposition of economic sanctions, including asset freezes and US visa restrictions. The underpinnings of this legal framework are three executive orders1 issued by...

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