EU imposes new sanctions on Russia

Monday 27 February 2023 13:05 CET | News

The European Union (EU) has agreed to impose new sanctions on Russia over its invasion of Ukraine.

It now targets additional officials and organisations suspected of aiding the war, spreading propaganda, or supplying drones, as well as prohibiting commerce in items used by the armed forces.

The European Union (EU) agrees to impose new sanctions on Russia over its invasion of Ukraine.

The EU's president stated the measures are aimed at military and political decision-makers, corporations supporting or operating inside the Russian military sector, and commanders in the Wagner Group.

Transactions with several Russian banks are also barred. Three more Russian banks have had their assets frozen, as have seven Iranian entities, firms, agencies, political parties, or other organisations that produce combat drones, which the EU claims Russia utilised during the conflict. The additional restrictions were only announced one day after the first anniversary of Russia's invasion of Ukraine, which was the original target date, after the significant internal debate.

The minor but symbolic delay demonstrates how difficult it has become for the 27-nation bloc to establish fresh goals for restrictive measures that are acceptable to all member states.

Why are the sanctions needed?

The sanctions are intended to damage Russia's economy and drain funding for its war effort, but they are also inflicting hardship on European economies that are already dealing with rising inflation and oil prices, as well as the consequences of the COVID-19 outbreak.

Prior to this latest round of sanctions, the EU had already targeted nearly 1,400 Russian officials, including President Vladimir Putin, government ministers, lawmakers, and oligarchs thought to be loyal to the Kremlin, as well as officers suspected of war crimes or targeting civilian infrastructure.

The bloc had also blocked the assets of over 170 organisations, including political parties and paramilitary groups, as well as banks, private firms, and media outlets suspected of promoting pro-Kremlin propaganda.Furthermore, the EU barred the acceptance of deposits in excess of defined amounts from Russian citizens or residents, the keeping of Russian customers' accounts by EU Central Securities Depositories, and the sale of EUR-denominated securities to Russian clients.

Who was affected this time?

Tinkoff, a Russian online bank, is one of the institutions that will cease EUR trading following the adoption of new European Union sanctions. Tinkoff stated in a separate statement that it has devised counter-measures to the penalties that would allow assets to be transferred to a new non-sanctioned firm within three weeks.

Another financial institution that has been sanctioned is Alfa-Bank, which has been added to the Central Bank of Russia's list of systemically significant credit institutions. Alfa-Bank works in the banking industry, which is a critical component of the Russian Federation's financial system. Alfa-Bank is therefore involved in an economic sector that provides a significant source of money to the Russian Federation's government, which is responsible for the annexation of Crimea and the destabilization of Ukraine.

An additional 87 people and 34 businesses have been listed by the EU. Rosbank, the Russian Federation's National Wealth Fund, and the Russian National Reinsurance Corporation are among the new entrants.

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Keywords: regulation, Russia Ukraine War, transactions , banks, COVID-19
Categories: Banking & Fintech
Countries: Europe, Russian Federation
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Banking & Fintech