Council Regulation (EU) 2023/2873 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine

New Council Regulation (EU) 2023/2873 as regards sanction measures with respect to persons and entities that threaten or undermine the safety, independence, and sovereignty of Ukraine was published in the Official Journal (OJ) of the EU. The regulation modifies Council Regulation (EU) No 269/2014 in that it
– extends the grounds for sanctioning persons, entities, and bodies which are subsequently listed in Annex I of the 2014 Regulation to include persons, entities, and bodies benefiting from the forced confiscation of firms formerly owned or controlled by European companies (e.g. subsidiaries in Russia).
– provides that deceased, sanctioned persons subject to asset freezing measures may remain on the EU sanctions list, if there are concerns that the assets belonging to such person may be used to finance the Russian war against Ukraine.
– allows Member States to release or make available frozen funds and resources of sanctioned persons, entities, and bodies. This permission may only be granted after confirming that a legal or judicial authority in that Member State has decided, according to legal requirements, to take away funds or resources from a person, entity, or body in the public interest. However, any compensation given for this deprivation of funds or resources should still remain frozen.
– further provides for a derogation from existing sanction measures to allow EU entities that have had ownership in Russian entities where such ownership has been „compulsorily transferred by the Russian government“ to divest their engagement (e.g. sale of stock) or receive compensation for such forced transfer.
– permits the release of frozen funds of or the making available of funds to the following entities provided that competent authorities find this action necessary for terminating existing engagements (operations, contracts, or agreements) concluded or entered into before February 25, 2023 by August 26, 2023
– Entry # 198 – Alfa-Bank JSC
– Entry # 199 – Public joint-stock company Rosbank
– Entry # 200 – Tinkoff Bank JSC
The same measure applies to Entry # 333 – JSC “Alabuga” Special Economic Zone of Industrial and Production Type provided that the contracts and agreements were entered into before December 19, 2023 and will be terminated by June 20, 2024. Certain additional payments are permitted for Entry #198, the Alfa-Bank JSC, „irrespective of when the operations, contracts or other agreements were concluded“.
– permits the release of frozen funds of AlfaStrakhovanie Group a.k.a. Alfa Insurance (Entry #270) for purposes of payments of compensation (insurance claims) to EU entities or entities located in the EAA.
– permits the the release of frozen funds or the making available of funds to the following persons and entities for purposes of the sale and transfer, by June 30, 2024, of ownership rights of those persons and entities in a legal person, entity, or body established in the Union (e.g. sale of equity shares), provided that the funds from such sale / transfer remain frozen:
– Entry # 92 – Arkady Romanovich ROTENBERG
– Entry # 674 – Petr Olegovich AVEN
– Entry # 675 – Mikhail Maratovich FRIDMAN
– Entry # 694 – Gennady Nikolayevich TIMCHENKO
– Entry # 880 – German Borisovich KHAN
– Entry # 882 – Alexey Viktorovich KUZMICHEV
– Entry # 909 – Igor Albertovich KESAEV
– Entry # 920 – Boris Romanovich ROTENBERG
– Entry # 38 – OAO ‘VO Technopromexport’
– Entry # 39 – OOO ‚VO Technopromexport‘
– permits the release of frozen funds of or the making available of funds to the following entities used for purposes of purchasing, importing, or transporting agricultural and food products, including wheat and fertilisers“. Entry #270 was thereby added:
– Entry # 53 – Bank Rossiya, Saint Petersburg
– Entry # 54 – PROMSVYAZBANK, Moscow
– Entry # 55 – VEB.RF, Moscow
– Entry # 79 – Otkritie FC Bank, Moscow
– Entry # 80 – Novikombank, Moscow
– Entry # 81 – Sovcombank, Moscow
– Entry # 82 – VTB Bank, Moscow
– Entry # 108 – Sberbank, Moscow
– Entry # 126 – Credit Bank of Moscow
– Entry # 127 – JSC ‘DALNEVOSTOCHNIY BANK
– Entry # 198 – Alfa-Bank JSC
– Entry # 199 – Public joint-stock company Rosbank
– Entry # 200 – Tinkoff Bank JSC
– Entry # 214 – MRB Bank
– Entry # 215 – CMRBank
– Entry # 270 – AlfaStrakhovanie Group a.k.a. Alfa Insurance
– requires Member States – by October 31, 2024 – to appoint the national authorities responsible for identifying and tracing funds and economic resources belonging so sanctioned individuals or entities residing in the European Union to prevent sanction evasion.