Crimea & Sevastopol – EU Sanctions

In view of the political unrest and developments in Crimea and Ukraine (as reported in the Club’s previous News Alert of 17 April 2014 – click here), the EU has implemented EU Council Decision 2014/386/CFSP (click here) and Council Regulation 692/2014 (click here) dated 23 June 2014 to impose the following sanctions:

1. A ban taking effect from 25 June 2014 against the import into the EU of goods originating from Crimea or Sevastopol; and

2. A ban on the direct or indirect provision of financing or financial  assistance, as well as insurance and reinsurance services relating to the import of goods originating in Crimea or Sevastopol.

There is an exemption for goods which the Ukrainian authorities have confirmed originate from Ukraine and there is a provision allowing for execution (until 26 September 2014) of trade contracts concluded before 25 June 2014 and ancillary contracts necessary for their execution is permitted. Those seeking to perform obligations under such contracts will need to comply with the relevant notification requirements i.e. 10 days advance notice to the competent authority of the Member State.

Members involved in trade with Crimea, Ukraine or Russia should take care to comply with the above and, further, to continue to monitor the situation carefully given the possibility of further sanctions in the future. In particular, the Club takes the opportunity to remind Members to exercise due diligence and ensure that the trade/transaction is lawful and the parties to it are not designated entities (see News Alert of 7 March 2014 regarding the designated persons – click here), otherwise this may give rise to an issue with Club cover.