Following coordinated designations of certain Belarusian individuals and entities earlier this week (see our previous post here), the EU has announced that further sector-based economic sanctions will come into force on 25 June 2021. The restrictions are implemented by Council Regulation (EU) 2021/1030 (the “Regulation“), which amends Regulation (EC) No 765/2006.
The new sanctions target a broad range of technology and software, dual-use goods and technology, tobacco, petroleum and potash products, and financial services. The prohibitions apply regardless of the origins of the products or technologies, and apply directly and indirectly. Furthermore, parties may not circumvent the restrictions.
Like all EU sanctions, these measures apply to: (i) all EU-incorporated entities and their non-EU branches; (ii) nationals of EU Member States, wherever located; (iii) activities taking place within EU territory; and (iv) other persons in respect of business done in whole or in part within the EU.
While the EU co-ordinated the designations earlier this week with Canada, the UK and the US, no further sanctions have been announced by these other jurisdictions at this time.
Parties are prohibited from engaging in a variety of financial services and dealing with related financial instruments, including:
- purchasing, selling, providing investment services for or assistance in the issuance of, or otherwise dealing with, transferable securities and money-market instruments with a maturity exceeding 90 days issued the Belarusian state and its government, Belarussian public bodies, corporations and agencies, and three Belarusian banks, as well as their majority-owned non-EU subsidiaries;
- loans or credit with a maturity exceeding 90 days maturity to the same (subject to an exception for the financing of legitimate EU trade); and
- insurance or re-insurance to the Belarusian Government and related entities.
Telecoms monitoring equipment
The sanctions impose a licensing obligation on the sale, supply, transfer or export to or for use in Belarus of a wide variety of equipment, software and technology for telecoms interception and monitoring.
EU persons are also prohibited from providing technical assistance, brokering services, financing or financial assistance, or monitoring and interception services to any party for use in Belarus or that will benefit the Belarusian authorities.
EU persons are prohibited from selling, supplying, transferring or exporting dual-use items to any person or entity in (or for use in) Belarus if the items may be wholly or partially intended for military use or a military end-user (including the Belarusian military). The sanctions also provide for such items to be prohibited for supply to named parties in Belarus, although no such parties have been listed at this time.
EU persons are also prohibited from providing technical assistance, brokering services, financing or financial assistance, in relation to dual-use items for such end-uses and end-users.
EUpersons may not sell, supply, transfer or export goods used in the production or manufacturing of tobacco products (including filters, papers, flavours and machinery) to or for use in Belarus.
Import restrictions on petroleum and potash
The sanctions also impose prohibitions on the import into the EU of petroleum products originating in or exported from Belarus, the purchase of petroleum products originating in or located in Belarus, and the provision of transport for petroleum products originating in or being exported from Belarus. It is also prohibited to provide technical assistance, brokering services, financing and financial assistance in relation to such items.
Import, purchase and transfer restrictions have also been imposed on potassium chloride (potash) sourced from Belarus.