Russia sanctions update: UK introduces new sanctions against Russia

United KingdomScotland

Fresh UK sanctions regulations have been introduced imposing further restrictions on doing business with Russia in light of Russia’s recent annexation of four Ukrainian regions. The fifteenth amendment to the Russia (Sanctions) (EU Exit) Regulations 2019 were laid before Parliament on 28 October 2022, with most provisions coming into force on 29 October 2022.

The Foreign, Commonwealth, and Development Office stated that the purpose of these new regulations is to “extend restrictions on trade with Russia” for the purposes of encouraging Russia to “cease actions destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine.”

The new Regulations:

  • Prohibit the making of a new category of loan and credit with a maturity exceeding 30 years (“category 5 loans”) to entities connected with Russia (including subsidiaries of those entities) and entities owned by individuals connected with Russia.
  • Prohibit the import of liquified natural gas (LNG) which is consigned from or originates in Russia, and the acquisition of LNG (as well as related technical assistance, financial services and funds, and brokering services) which originates from or is located in Russia, with the intention of the LNG entering the UK.
  • Prohibit the import of gold which has been processed in a third country and includes gold that, on or after 21 July 2022, originated from Russia and has been exported from Russia and the acquisition of gold jewellery which originates, is located or has been exported from Russia with the intention of entering the UK (as well as related technical assistance, financial services and funds, and brokering services).
  • Prohibit the export of Russia’s vulnerable goods, as defined, to Russia. This list includes hundreds of goods deemed critical for Russia’s manufacturing sector with the intention of further isolating Russia’s economy and key industries that directly or indirectly support the war in Ukraine.
  • Add further items to the lists of

All of these restrictions came into force on 29 October 2022, except the new prohibition on LNG which will enter into force on 1 January 2023.

Notably absent are provisions relating to export bans on Russian access to IT consultancy, architectural, engineering, auditing, and transactional legal advisory services, which the government had previously noted would be included in this package in their statement of 30th September. This omission is unexpected in light of the adoption by the EU of similar prohibitions.