Ukraine - Swedish Dockworkers Blockade & EU Sanctions - Update of 18 March

The Swedish Dockworkers Union has given notice about nationwide blockade against Russian ships and cargo, as per the following statement:

"The Swedish Dockworkers Union has given notice to the employers’ organisation Ports of Sweden today about upcoming industrial action against ships going to and from Russia as well as Russian cargo in all Swedish ports.

The solidarity action will be carried out to support the dockworkers and the suffering working class in Ukraine during the ongoing Russian invasion.

Swedish dockworkers will not handle any ships going to and from Russia, ships carrying Russian import and export cargo and vessels registered as Russian.

- The Putin regime's brutal use of force against Ukrainian civil society has closed the ports. The bombing of Odessa, the occupation of Kherson and the ongoing deadly siege on Mariupol is causing unspeakable suffering on the ground, says SDU's national chairman Martin Berg.

- "Business as usual" is no longer possible. We have waited for effective sanctions from the state or the EU blocking Swedish ports for Russian interests at this point, but time has run out. Our members want to do what little we can to contribute to an end to the Russian invasion and a reopening of Ukrainian ports.”

EU Sanctions

On the 15 March 2022, the EU announced a fourth package of sanctions in response Russia’s aggression against Ukraine. The press release is available here. The measures are as per EU Council Regulation 2022/428 of 15 March 2022 which includes:-

• Article 3g - a ban on the import, directly or indirectly, of iron and steel products listed in Annex XVII if they: (i) originate in Russia; or (ii) have been exported from Russia; and where such products are exported from Russia a ban on their transport to any other country. These bans include a ban on providing insurance or reinsurance.
• Article 3h – a ban on selling, supplying, transferring, exporting, directly or indirectly of luxury goods listed in Annex XVIII to any natural or legal person, entity or body in Russia or for use in Russia.
• Article 3 – a ban on the sale, supply, transfer, export, directly or indirectly, on equipment, goods , technology and service, as listed in Annex II, for the energy industry in Russia (with the exception of the nuclear industry and the downstream sector of energy transport), which includes categories of exploration and production projects. It is also prohibited to provide technical assistance or financial assistance (which is defined to include insurance or reinsurance) in respect of these activities. However, this ban does not apply to the transport of fossil fuels, in particular coal, oil and natural gas from or through Russia into the EU. There is an exemption until 17 September 2022 for the performance of contracts concluded before 16 March 2022 provided that the competent authority of the EU member state has been given five working days prior notice.
• a prohibition on all transactions with certain state-owned enterprises;
• a prohibition on transactions with certain state-owned companies which are already subject to refinancing restrictions;
• a prohibition on the provision of credit rating services and ban on the access to any subscription services in relation to credit rating activities to Russian clients;
• a ban on new investments or joint ventures in the Russian energy sector, which includes creating any new joint venture with an entity incorporated or constituted under Russian law or any other third country

Some of the above provisions include prohibitions against the provision of insurance and reinsurance for the listed activities. Consequently it’s possible that even though a Member/Assured may not be directly impacted by the Regulation (eg. if they are domiciled outside the EU), the Club may be prevented from providing cover for engaging in these activities. Members/Assureds who are potentially affected should get in touch with their usual Club contact at the earliest opportunity.

Additional entities continue to be designated, including Russian entities operating in the aviation, military, shipbuilding, and machine building sectors, Rosneft Aero; JSC Rosoboronexport; JSC NPO High Precision Systems; JSC Kurganmashzavod; JSC Russian Helicopters; PJSC United Aircraft Corporation; JSC United Shipbuilding Corporation; JSC Research and Production Corporation Uralvagonzavod, and JSC Zelenodolsk Shipyard (A. M. Gorky Zelenodolsk Plant).

Members and Assureds should carefully assess the risks involved in trade connected with Russia, Belarus and/or Ukraine, and ensure that due diligence is carried out using updated lists. This is a fast developing situation and there may be other sanctions and details that we have not mentioned and/or are not yet available. Further News Alerts will follow on additional sanctions that are implemented.