Sanctions and Export Controls News Digest – February 2024

SYSTEMIC CHANGES

US, UK and EU participate in Sanctions Coordinators Forum

On 14 February 2024, the US Departments of State, Commerce, and Treasury participated in a “Sanctions Coordinators Forum” alongside senior EU and member state government officials, as well as representatives from the UK and Ukraine. The forum signalled the US, UK and EU’s commitment to strengthening their coordination and cooperation on sanctions implementation, in order to maximise their effect.

US announces new policy authorising imposition of sanctions with respect to misuse of spyware

On 5 February 2024, the US State Department announced a new policy which will allow the imposition of visa restrictions on individuals involved in the misuse of commercial spyware. This is part of the US’ broader approach to countering the misuse of commercial spyware, following the announcement of Executive Order 14093 in March 2023 which prohibits the use of commercial spyware that poses risks to US national security.

US announces new Executive Order authorising imposition of sanctions in response to actions undermining peace, security, and stability in the West Bank

On 1 February 2024, President Biden announced Executive Order 14115 – a new targeted sanctions program “Imposing Certain Sanctions on Persons Undermining Peace, Security, and Stability in the West Bank” – following the “high levels of extremist settler violence, forced displacement of people and villages, and property destruction” which the US considers to pose an unusual and extraordinary threat to its national security and foreign policy. Under this program, the US can designate individuals and entities determined to have been involved in such actions. Persons designated under this framework will be subject to both financial sanctions and a visa ban.

UK publishes its strategy regarding its use of sanctions for the years ahead 

In March 2024, the UK Government published a strategy entitled “Deter, Disrupt and Demonstrate – UK sanctions in a contested world” which sets out the priorities and principles that will shape its use of sanctions against Russia going forward. The strategy intends to undermine Russia’s ability to fund and wage its war against Ukraine by focusing on 1) addressing sanctions circumvention, 2) building international coalitions and taking more co-ordinated action with allies and partners, and 3) reinforcing sanctions implementation and enforcement by helping UK businesses to understand and comply with sanctions, and by taking action on non-compliance.

DESIGNATIONS AND DESIGNATION CHALLENGES

US, UK and EU announce new rounds of designations on anniversary of Russia’s full-scale invasion of Ukraine

On 23 February 2024, on the second anniversary of Russia’s full-scale invasion of Ukraine, the US, UK and EU each announced new rounds of designations against Russia:

●      The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated almost 300 additional individuals and entities; the US Department of State designated three Russian officials involved in the death of Navalny; and the US Department of State together with the Treasury designated over 500 targets in order to maximise financial pressure on Russia for its repression, human rights abuses, and aggression against Ukraine;

●      The UK designated more than 50 targets, focusing on munitions manufacturers, electronics companies, and diamond and oil traders; and

●      The EU adopted its 13th package of sanctions, designating 106 individuals and 88 entities. The package focused on limiting Russia’s access to military technologies and targeting individuals and entities involved in Russia’s war effort. The EU’s sanctions listings now exceed 2000.

US Sanctions Updates

On 2 February 2024 OFAC sanctioned four Iran and Hong Kong-based entities, pursuant to Executive Order 13382, for their involvement in a crucial procurement network supplying materials and sensitive technology for Iran’s ballistic missile and Unmanned Aerial Vehicle (UAV) programs, including the Shahed-series UAV. Executive Order 13382 pertains to proliferators of weapons of mass destruction and their means of delivery,

On 1 February 2024 the US State Department designated four individuals, pursuant to Executive Order 14115, for their actions that undermine peace, security, and stability in the West Bank and the prospects of peace and security for Israelis and Palestinians alike. These designations follow the announcement of a related visa restriction policy on 5 December 2023 which serves the same purpose - opposing actions that undermine stability in the West Bank.

UK Sanctions Updates

On 20 February 2024 the former mayor of Sevastopol in occupied Crimea was charged by the Southwark Crown Court with violating sanctions - on account of his acquiring British citizenship and residing in the UK - and money laundering. He is the first person to be charged in the UK with breaching Russian sanctions.

EU Sanctions Updates

On 22 February 2024 the EU designated six individuals and one entity, pursuant to Annex I to Regulation (EU) 2023/888, for their involvement in actions destabilising the Republic of Moldova. The targets comprise Russian government officials, Moldovan paramilitary actors, and other public figures, including some within the media and some associated with Ilan Shor.

On 2 February 2024 the EU Council designated five individuals for actions which undermine democracy and the rule of law in Guatemala. The decision follows the EU’s adoption of a sanctions framework focused on supporting democracy and a peaceful and orderly transfer of power in Guatemala, with respect to President Bernardo Arévalo’s democratic election and inauguration in January 2024.

EXPORT CONTROLS

Within its 13th sanctions package released on 23 February 2024, the EU added 27 Russian and third country companies associated with Russia's military-industrial complex to the list of entities subject to export restrictions under Annex IV of Regulation 833/2014. The targets comprise 17 Russian companies and four companies registered in China, and six companies registered respectively in Kazakhstan, India, Serbia, Thailand, Sri Lanka, and Turkey.  These restrictions pertain to dual-use goods and technology, as well as goods and technology which might contribute to the technological enhancement of Russia's defence and security sector.