The situation in Ukraine has been changing rapidly in the past days including in relation to the sanctions imposed against Russia. In addition to the sanctions already announced, new sanctions are expected in the near future and expected to have a severe impact on the Russian economy and financial institutions. They will also affect transport and access to Russian ports. We briefly summarize the latest sanctions as follows:
On 21 February, President Biden signed an Executive Order targeting the Donetsk People’s Republic and the Luhansk People’s Republic in Ukraine which prohibits:
a. new investment in these regions;
b. the import of good, services, technology from these regions to the US; and
c. export of goods, services or technologies from the US or by a US person to these regions.
On 22 February, the US introduced sanctions against the Russian financial services sector including targeted sanctions against two Russian state-owned financial institutions, with the Foreign Economic Affairs Vnesheconombank (“VEB”) and Promsvyazbank Public Joint Stock Company (“PSB”) and their subsidiaries listed on the SDN list.
The UK sanctions are limited in scope but add 5 Russian banks (IS Bank; Rossiya Bank; PJSC Promsvyazbank; JSC Genbank; and JSC Black Sea Bank Development and Reconstruction) as well as 3 private individuals to the UK sanctions lists. The UK government has also announced that sanctions already imposed in relation to Crimea will be extended to non-government controlled territory in the breakaway republics of Donetsk and Luhansk.
On 22 February, EU Member States agreed to a new package of sanctions against Russia, which will now be formally implemented. The sanctions target individuals, companies and banks. Trade is to be banned between the two breakaway regions and the EU. The Russian government is also cut off from the European financial markets.
In light of the ongoing developments, this is a preliminary summary only and more measures have already been announced. We will continue to monitor the situation closely and will publish further updates. We recommend that members to carry out sanctions checks before all voyages to Russia, avoid the territorial waters of Ukraine and Russia in the Black Sea for the time being and to contact the NNPC at email@example.com should there be any questions.
Finally, we recommend Members to include the BIMCO Sanctions Clause for Time CharterParties 2020 or the BIMCO Sanctions Clause for Voyage CharterParties 2020, as appropriate, in their charter parties.