On 5 August 2022, the National Security and Defense Council of Ukraine introduced a new set of sectoral special economic and other restrictive measures (sanctions) against the Russian Federation (“Sanctions“).1
To become effective, the Sanctions must be approved by the Ukrainian Parliament, which is expected within a week.2
The Sanctions are to be effective for a period of 10 years and include, in particular, the following restrictions:3
- Ban on the withdrawal of capital from Ukraine in favor of the Russian Federation, individuals and legal entities established and/or operating under the laws of the Russian Federation, as well as legal entities established and/or operating under the laws of Ukraine, the ultimate beneficial owner or shareholders (having 10% or more of shares in the charter capital of a company) of which is the Russian Federation, Russian companies or citizens of the Russian Federation (“Russian Persons“)
- Suspension of licenses for the use of Ukrainian subsoil to the Russian Persons
- Ban on participating in the privatization and lease of Ukrainian state property for the Russian Persons
- Ban on public procurement of goods manufactured in Russia and goods, works and services from the Russian Persons4
- Ban on entry into Ukrainian territorial waters and ports for nonmilitary ships under the Russian flag or belonging to companies associated with Russia
- Ban on flights from the Russian Federation to Ukraine by aircraft associated with Russian companies or registered in the Russian Federation
- Ban on the purchase of securities issued by the Russian Persons
- Ban on the issuance of permits and licenses of the National Bank of Ukraine for investment in the Russian Federation
- Termination of the withdrawal of cash using cards issued by companies associated with the Russian Federation
- Ban on the transfer of technologies and IP rights to the Russian Persons
- Ban on the acquisition of land plots by the Russian Persons
The Sanctions will enter into force on the day they are approved by the Ukrainian Parliament.
1. Decision of the National Security and Defense Council of Ukraine “On Imposition of Sectoral Special Economic and Other Restrictive Measures (Sanctions) against the Russian Federation” dated 5 August 2022 approved by Presidential Decree No. 563/2022 dated 5 August 2022 “On the Decision of the National Security and Defense Council of Ukraine dated 5 August 2022 On Imposition Sectoral Special Economic and Other Restrictive Measures (Sanctions) against the Russian Federation.”
2. Draft Resolution of the Parliament of Ukraine “On Approval of the Decision of the National Security and Defense Council of Ukraine dated 5 August 2022 On Imposition Sectoral Special Economic and Other Restrictive Measures (Sanctions) against the Russian Federation.” Please see here.
3. Please note that the Sanctions do not apply to (i) citizens of the Russian Federation legally residing in Ukraine and (ii) companies established and operating under Ukrainian law, the ultimate beneficial owners or shareholders of which are citizens of the Russian Federation legally located in Ukraine.
4. Please note that this restrictive measure does not apply to goods, works and services necessary for servicing Russian goods purchased before the imposition of the Sanctions.
