Sanctions: Russian Federation

Purpose of the Sanctions Regime

This sanctions regime is aimed encouraging Russia to cease actions destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine.

Financial Services

Asset freeze and making available provisions

This sanctions regime imposes financial sanctions through a targeted asset freeze on designated persons and prohibitions on making funds or economic resources available. This involves the freezing of funds and economic resources (non-monetary assets, such as property or vehicles) of designated persons and ensuring that funds and economic resources are not made available to or for the benefit of designated persons, either directly or indirectly.

Other financial and investment restrictions

This sanctions regime prohibits a person from directly or indirectly dealing with a transferable security or money market instrument if it has a maturity exceeding 30 days, and was issued after 1 August 2014 by:

• Sberbank, VTB bank, Gazprombank, Vnesheconombank (VEB), Rosselkhozbank
• An entity incorporated or constituted in a country other than the UK which is owned by one or more of the five banks listed above
• An entity acting on behalf of or at the direction of those five banks named above or an entity incorporated or constituted in a jurisdiction other than Jersey which is owned by one or more of those five banks.

It is also prohibited for a person to directly or indirectly deal with a transferable security or money market instrument if it has a maturity exceeding 30 days, and was issued after 12 September 2014 by:

• OPK Oboronprom, United Aircraft Corporation, Uralvagonzavod, Rosneft, Transneft or Gazprom Neft
• An entity incorporated or constituted in a jurisdiction other than Jersey which is owned by one or more of the six entities listed above
• An entity acting on behalf of, or at the direction of, those six entities named above or an entity incorporated or constituted in a jurisdiction other than Jersey which is owned by one or more of those six entities.

Loan and credit arrangements

This sanctions regime prohibit a person from directly or indirectly granting or entering into any arrangement to grant a new loan or credit, with a maturity exceeding 30 days to:

• Sberbank, VTB bank, Gazprombank, Vnesheconombank (VEB), Rosselkhozbank, OPK Oboronprom, United Aircraft Corporation, Uralvagonzavod, Rosneft, Transneft or Gazprom Neft
• An entity incorporated or constituted in a jurisdiction other than Jersey which is owned by one or more of the entities listed above
• An entity acting on behalf of or at the direction of the entities listed above or an entity incorporated or constituted in a jurisdiction other than the Jersey which is owned by one or more of those entities.

This sanctions regime prohibits:

1. Directly or indirectly acquiring, extending a participation, or acquiring any ownership interest in land located in Crimea
2. Directly or indirectly acquiring, extending a participation, or acquiring any ownership interest in an entity which has a place of business located in Crimea (Relevant Entity)
3. Directly or indirectly granting any loan or credit, entering into any arrangement to grant a loan or
4. Directly or indirectly establishing any joint venture in Crimea or with a Relevant Entity
5. Providing investment services directly related to the activities referred to in (1) to (4) above.

Overview of current sanctions measures

Current sanction measures implemented by Jersey in relation to the Russia include:

• Asset freezes and restrictions on making funds and economic resources available to and for the benefit of designated persons
• Financial and other investment restrictions, including prohibitions relating to transferable securities or money market instruments, prohibitions relating to loans and credit arrangements, and investments in Crimea
• Travel restrictions
• Prohibitions against the import, export, supply and delivery, making available, or transfer of military goods, military technology, dual-use goods, and dual-use technology
• Prohibitions against the provision of technical assistance, financial services and funds, or brokering services, relating to military goods, military technology, dual-use goods, and dual-use technology
• Restrictions on energy-related goods and related activities
• Restrictions relating to exports and imports, and related activities relating to Crimea.

Latest news

1 July 2021

The Sanctions and Asset-Freezing (Implementation of External Sanctions)(Jersey) Order 2021 gives effect to the Russia (Sanctions) (EU Exit) Regulations 2019. One designation has been amended and remains subject to an asset freeze. Further information can be found here.

22 June 2021

The Sanctions and Asset-Freezing (Implementation of External Sanctions)(Jersey) Order 2021 gives effect to the Russia (Sanctions) (EU Exit) Regulations 2019. One designation has been amended and remains subject to an asset freeze (UK notice made on 21 June 2021). Further information can be found here.

12 February 2021

The Sanctions and Asset-Freezing (Implementation of External Sanctions) (Jersey) Order 2021 made under the Sanctions and Asset Freezing (Jersey) Law 2019 came into force to implement the Russia (Sanctions) (EU Exit) Regulations 2019.

1 January 2021

The UK made the Russia (Sanctions) (EU Exit) Regulations 2019 under the Sanctions and Anti-Money Laundering Act 2018, which came into force following the end of the transition period for the UK-EU Withdrawal Agreement.

These regulations have replaced, with substantially the same effect, relevant existing EU legislation and related UK regulations.

*All published Latest News notices relating to financial sanctions, including those extending beyond the last 30 days, may be obtained from the Jersey Gazette

Jersey regime

The Sanctions and Asset-Freezing (Implementation of External Sanctions) (Jersey) Order 2021 (the Jersey Order) implements the Russia (Sanctions) (EU Exit) Regulations 2019 (the UK Regulations).

Article 3 of the Jersey Order imposes the asset-freeze provisions in Part 3 of the Sanctions and Asset-Freezing (Jersey) Law 2019 (the SAFL) on any person listed by or under the UK Regulations. The Part 3 provisions also include, but are not limited to, Articles 15-17 of the SAFL on exceptions, licences, and circumventing prohibitions etc.

Offences

The offences for this regime are set out in Parts 3 (Asset-freezes) and 6 (Information) of the SAFL and in Articles 4 to 6 of the Jersey Order.

Reporting obligations

Reporting obligations are set out at Article 32 of the SAFL and apply to all regimes in force. These obligations include requirements for a relevant financial institution to inform the Minister if:

• It holds an account of a person, has entered into dealings or an agreement with a person or has been approached by or on behalf of a person, and
• It knows, or has reasonable cause to suspect, that the person:
  • Is a designated person, or;
  • Has committed an offence, and
• The information or other matter on which the knowledge or reasonable cause for suspicion is based came to it in the course of carrying on its business.

Licences and exceptions

Asset-freeze prohibitions: The provisions on exceptions and licences for asset-freezes are set out in Part 3 of the SAFL. A licence may only be granted by the Minister if there is scope in the relevant UK regulations for an equivalent licence to be granted by the UK Treasury. Exceptions to an asset-freeze that are set out in UK sanctions regulations do not apply in Jersey; however, they may be considered as a basis for an asset-freeze licence application.

Non asset-freeze prohibitions: The provisions on exceptions and licences are set out in Part 3 of the SAFL. A licence may only be granted by the Minister if there is scope in the relevant UK regulations for an equivalent licence to be granted by the UK Treasury. Exceptions to a non asset-freeze prohibition that are set out in UK sanctions regulations apply in Jersey.

UK General Licences do not apply to Jersey persons or institutions operating in Jersey; however, they may be considered as the basis for a licence application.

NB: This regime also allows for the designation of persons for immigration/travel restrictions, which would be enforced under Jersey’s immigration legislation.

Legal acts

Jersey

• Sanctions and Asset-Freezing (Jersey) Law 2019
• Sanctions and Asset-Freezing (Implementation of External Sanctions) (Jersey) Order 2021

United Kingdom

• The Russia (Sanctions) (EU Exit) Regulations 2020
• The Sanctions (EU Exit) (Miscellaneous Amendments) (No.2) Regulations 2020
• The Sanctions (EU Exit) (Miscellaneous Amendments) (No.4) Regulations 2020

Further information

Useful information is provided on gov.uk regarding Financial sanctions, Russian Federation