EU Sanctions On Belarus: Business Just Got A Whole Lot More Complicated
The European Union (EU) has revised its sanctions on Belarus, a little-known dictatorship in Eastern Europe. Businesses must pay close attention to the most recent developments.
9 March 2022: Russia’s military aggression against Ukraine: EU agrees on new sectoral measures targeting Belarus
The agreed measures will:
restrict the provision of specialised financial messaging services (SWIFT) to Belagroprombank, Bank Dabrabyt, and the Development Bank of the Republic of Belarus, as well as their Belarusian subsidiaries;
prohibit transactions with the Central Bank of Belarus related to the management of reserves or assets, and the provision of public financing for trade with and investment in Belarus;
prohibit the listing and provision of services in relation to shares of Belarus state-owned entities on EU trading venues as of 12 April 2022;
significantly limit the financial inflows from Belarus to the EU, by prohibiting the acceptance of deposits exceeding €100.000 from Belarusian nationals or residents, the holding of accounts of Belarusian clients by the EU central securities depositories, as well as the selling of euro-denominated securities to Belarusian clients;
prohibit the provision of euro denominated banknotes to Belarus.
Belarus Sanctions: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=OJ:L:2022:082:TOC
2 March 2022 Belarus' role in the Russian military aggression of Ukraine: Council imposes sanctions on additional 22 individuals and further restrictions on trade
The Council today decided to impose targeted restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine, on 22 high ranked members of Belarusian military personnel in view of their role in the decision making and strategic planning processes that led to the Belarusian involvement in the Russian aggression against Ukraine. On 24 February, 20 members of Belarusian military personnel were already listed in the same context.
Official Journal of the European Union, L 66, 2 March 2022 (including a list of the sanctioned individuals and entities)
Official Journal of the European Union, L 67, 2 March 2022
· Belarus Sanctions: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=OJ:L:2022:082:TOC
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· Russia Sanctions: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=OJ:L:2022:081:TOC
Restrictive Measures
The EU calls its sanctions restrictive measures. They are seen as "an essential tool in the EU’s common foreign and security policy (CFSP)". In this way, the EU can intervene where the organisation feels this is necessary to prevent conflict or respond to emerging or current crises.
The EU is keen to stress that, in spite of their colloquial name ‘sanctions’, EU restrictive measures are intended to bring about a change in policy or activity by targeting non-EU countries, as well as entities and individuals, responsible for the malign behaviour at stake.
40+ different sanctions regimes
The EU has over forty different sanctions regimes in place. Some are mandated by the United Nations Security Council, whereas others are adopted autonomously by the EU.
Why are sanctions imposed?
The EU imposes sanctions due to serious violations of human rights or the repression of civil society and democratic opposition, or whose activities otherwise seriously undermine democracy or the rule of law in Belarus or who benefit from or support the Lukashenka regime.
Freeze
Companies and banks are required to freeze funds and certain economic resources. Council Regulation (EC) No 765/2006 provides for the freezing of funds and economic resources of and prohibits making funds or economic resources available to, persons, entities or bodies responsible for serious violations of human rights or the repression of civil society and democratic opposition, or whose activities otherwise seriously undermine democracy or the rule of law in Belarus or who benefit from or support the Lukashenka regime.
Prohibition
It is prohibited to make certain funds or economic resources available to,
- persons,
- entities or
- bodies are responsible.
The law also prohibits the provision of technical assistance related to the goods and technology listed in the Common Military List of the European Union or related to the provision, manufacture, maintenance and use of such goods.
The law further imposes a ban on the export of equipment that might be used for internal repression to any person, entity or body in Belarus or for use in Belarus, and prohibits the provision of related technical assistance, brokering services, financing or financial assistance.
Airspace
It further prohibits Belarusian air carriers from landing in, taking off from or overflying the territory of the Union.
Almost two decades of Sanctions
Restrictive measures against Belarus were first introduced in 2004. In parallel to the sanctions connected to the August 2020 elections, the EU also has other types of sanctions in place against Belarus.
These measures include
an arms embargo;
a ban on the export of goods for internal repression;
an asset freeze;
and a travel ban against four people listed in connection with the unresolved disappearances of two opposition politicians, one businessman and one journalist in 1999 and in 2000.
The restrictive measures against Belarus were first introduced in 2004 in response to the disappearance of the four persons referred to above. The Council later adopted further restrictive measures against those involved in the violation of international electoral standards and international human rights law, as well as in the crackdown on civil society and democratic opposition. The arms embargo was introduced in 2011.
On 15 February 2016, the Council decided to lift the restrictive measures against 170 individuals and three companies, while maintaining the arms embargo and the sanctions against the four persons. This decision was taken while acknowledging the steps taken by Belarus that have contributed to improving EU-Belarus relations.
The August 2020 presidential elections
Since October 2020, the EU has progressively imposed restrictive measures against Belarus. The measures were adopted in response to the fraudulent nature of the August 2020 presidential elections in Belarus, and the intimidation and violent repression of peaceful protesters, opposition members and journalists. The EU does not recognise the results of the Belarus elections, condemning them as neither free nor fair.
In early 2021, a total of 88 individuals and 7 entities were designated under the sanctions regime on Belarus. These include the Belarusian President, Alexandr Lukashenko and his son and National Security Adviser, Viktor Lukashenko, as well as other key figures of the political leadership and of the government, high-level members of the judicial system and several prominent economic actors. The targeted individuals had been identified as responsible for repression and intimidation against peaceful demonstrators, opposition members and journalists in the wake of the 2020 presidential election in Belarus, as well as for misconduct of the electoral process.
May 21: Forced Ryanair flight incident
On 24 May 2021, the EU strongly condemned the forced landing of a Ryanair flight in Minsk, Belarus, endangering aviation safety, as well as the detention by Belarusian authorities of journalist Raman Pratasevich and Sofia Sapega. EU-based carriers were told to avoid overflight of Belarus, and had called on the Council to adopt the necessary measures to ban overflight of EU airspace by Belarusian airlines and prevent access to EU airports of flights operated by such airlines.This was further amended in June 2021 to allow for certain exceptions
November 21: EU broadens the scope for sanctions to tackle hybrid attacks and instrumentalisation of migrants
The EU broadened the sanctions regime in view of the situation at the EU’s border with Belarus, so as to be able to respond to the instrumentalisation of human beings carried out by the Belarus regime for political purposes.
The sanctions regime was amended by way of a Council decision and a Council regulation, which broaden the listing criteria on which specific designations can be based. The EU will now be able to target individuals and entities organising or contributing to activities by the Lukashenko regime that facilitate the illegal crossing of the EU's external borders.
In Article 2 of Regulation (EC) No 765/2006, the following paragraph is added:
‘6. Annex I shall also consist of a list of:
(a)the natural or legal persons, entities or bodies who, in accordance with Article 4(1), point (c), of Decision 2012/642/CFSP, have been identified by the Council as organising or contributing to activities by the Lukashenka regime that facilitate:
(i)the illegal crossing of the external borders of the Union; or
(ii)the transfer of prohibited goods and the illegal transfer of restricted goods, including hazardous goods, into the territory of the Union; and
(b)the legal persons, entities or bodies who, in accordance with Article 4(1), point (d), of Decision 2012/642/CFSP, have been identified by the Council as legal persons, entities or bodies owned or controlled by persons, entities or bodies referred to in point (a).’.
Belarus Sanctions Nov 21 - CELEX_32021R1985_EN_TXT
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Results
By November 2021, a total of 166 individuals and 15 entities are now designated under the sanctions regime on Belarus. These include Alexandr Lukashenko and his son and national security adviser, Viktor Lukashenko, as well as other key figures in the political leadership and the government, high-level members of the judicial system and several prominent economic actors. Measures against designated persons include travel bans and an assets freeze.
What can businesses do?
All businesses in all sectors are obliged to comply with sanctions requirements, and therefore need to have adequate controls in place. Historically, enforcement actions have been more prominent in Financial Services, but other sectors have also received significant fines and some regulatory bodies are increasingly turning their attention to other industries. Failure to comply with sanctions or obtain the correct licence, in the case of export controls, can lead to significant fines.
This means firms must ensure that they carry out effective sanctions screening, not only on direct third parties but also their associates, beneficial owners and the extended supply chain, particularly in geographies known to have strong links to sanctioned countries.
3 December 21: Many names added
On 15 October 2012, the Council adopted Decision 2012/642/CFSP concerning restrictive measures in view of the situation in Belarus. On 21 and 22 October 2021, the European Council adopted conclusions in which it declared that it will not accept any attempt by third countries to instrumentalise migrants for political purposes, condemned all hybrid attacks at the Union’s borders and affirmed that it will respond accordingly. It underlined that the Union will continue countering the ongoing hybrid attack launched by the Belarusian regime, including by adopting further restrictive measures against persons and legal entities, in line with its gradual approach, as a matter of urgency. In its Decision (CFSP) 2021/1990 (2) of 15 November 2021, the Council amended the designation criteria in Decision 2012/642/CFSP to allow for the application of targeted restrictive measures against natural or legal persons, entities or bodies organising or contributing to activities by the Lukashenka regime that facilitate the illegal crossing of the external borders of the Union or the transfer of prohibited goods and the illegal transfer of restricted goods, including hazardous goods, into the territory of a Member State. In view of the gravity of the situation in Belarus, 17 persons and 11 entities should be included in the list of natural and legal persons, entities and bodies subject to restrictive measures set out in the Annex to Decision 2012/642/CFSP.
The Annex to Decision 2012/642/CFSP should therefore be amended accordingly,
and
Belarus Sanctions: the law
The key legislation is
EU Council Regulation (EC) No 765/2006.
Council Regulation (EC) No 765/2006 of 18 May 2006 concerning restrictive measures in respect of Belarus (OJ L 134, 20.5.2006, p. 1).
Council Regulation (EU) 2021/1030 of 24 June 2021 amending Regulation (EC) No 765/2006 concerning restrictive measures in respect of Belarus (OJ L 224 I, 24.6.2021, p. 1).
Council Decision (CFSP) 2021/1989 of 15 November 2021 amending Decision 2012/642/CFSP concerning restrictive measures in view of the situation in Belarus (see page 8 of this Official Journal).
More information
https://www.customsmanager.org/post/how-to-shield-your-business-from-trading-with-sanctioned-people
https://www.customsmanager.org/post/fines-for-financial-sanctions-breaches
https://www.customsmanager.org/post/is-your-business-ready-to-comply-with-uk-sanctions
https://www.customsmanager.org/post/trading-with-russia-new-eu-us-navalny-sanctions-bite