June 29, 2020

European Court of Justice rejects Russian banks’ request to be removed from Ukraine/Crimea sanctions list

In June 2020, the European Union renewed economic and other sanctions on Russia, which were first imposed in March 2014 in response to the annexation of the Crimea and the deliberate destabilization of Ukraine.  The measures include:

• an import ban on goods from Crimea and Sevastopol,
• restrictions on trade and investment related to certain economic sectors and infrastructure projects,
• a prohibition on the provision of touristic services in Crimea and Sevastopol;
• an export ban on certain goods and technologies;
• the imposition of import and export bans on trade in arms and some dual use goods for military use;
• the curtailment of Russian access to certain technologies and services used for oil production and exploration, and;
• limitations on access to EU primary and secondary capital markets for certain Russian banks and companies;

On June 25, 2020, the European Court of Justice upheld the application of the latter of these restrictions to two Russian financial institutions, dismissing appeals by VTB Bank PAO and Vnesheconombank asking to be removed from the sanctions list.  The ECJ gave deference to the European Union’s decision to include the banks based on their majority ownership by the Russian state.

ECJ opinion (VTB)ECJ opinion (Vnesheconombank)