On 18 July 2023, the Dutch Fiscal Intelligence and Investigation Service (FIOD) published a statement that it had recently arrested a Dutch citizen in an ongoing investigation into suspected circumvention of EU sanctions against Russia. As part of the investigation, the FIOD also seized the business inventory and digital and physical administration of the suspect and his company.
The arrested individual is suspected of exporting computers and computer parts to Russia in violation of EU sanctions. The investigation started after signals were provided by Dutch Customs to the FIOD with regard to unusual trading patterns involving the individual’s company. Specifically, after the introduction of recent EU Russia sanctions in February 2022, the authorities noted a decrease in exports to Russia while there was a strong increase in exports to “diversion countries”, such as Kazakhstan, Kyrgyzstan, Mongolia, Uzbekistan, Turkey and the UAE. The authorities suspect that, in this way, the products were eventually diverted to Russia. Violation of EU Russia sanctions is a criminal offense in the Netherlands, for which potential penalties include significant fines or imprisonment. This investigation fits within the broader trend in the Netherlands and other EU countries towards increased detection risk, scrutiny and active enforcement of EU sanctions compliance, including close monitoring of trade flows and increasing information exchanges between authorities. Notably, these actions follow from a recent policy call by the Dutch government that “the year 2023 must be the year of success in countering circumvention.” These further show that the product controls of EU Russia sanctions cover a wide variety of products, which go well beyond “regular” export controls, and that small and medium-sized businesses may also be on the hook for (alleged) sanctions violations.