With the possibility of further amendments - Newspaper Kommersant No. 186 (7387) dated 07.10.2022

With the possibility of further amendments - Newspaper Kommersant No. 186 (7387) dated 07.10.2022



The economic part of the eighth package of EU anti-Russian sanctions, the text of which was published on October 6, turned out to be very diverse. The list of bans and restrictions included both long-awaited measures, such as a price ceiling for Russian oil, and an unexpected ban on the import of metallurgical semi-finished products - slabs. Sanctions against some industries are characterized by streamlined wording, and the ban on European lawyers from advising Russian companies and citizens is extremely specific. However, as usual, exceptions and deferrals are provided for sanctions against the most sensitive markets for the European economy itself.

Metallurgists were given a reprieve

Contrary to the requests of the European steel industry, the EU in the new package of sanctions banned the import of Russian slabs. But the sanctions contain an important exception: a full ban comes on September 30, 2024, and until this date, slabs from Russia can continue to be imported, but in volumes not exceeding the 2021 level (3.7 million tons per year). The sanctions will mainly affect Vladimir Lisin’s NLMK, which supplies slabs to its rolling mills in Belgium, France, Denmark and Italy: in 2021, shipments amounted to 2.4 million tons.

The Eurofer lobby of European steelmakers asked the European Commission not to impose sanctions on slabs, since there are few large suppliers of this billet in the world, and 80% of steel semi-finished products imports to the EU come from Russia and Ukraine.

After the shutdown of Ukrainian factories, there is virtually no alternative to supplies from Russia. So, there are several factories in Iran that are under sanctions, as well as North American manufacturers that usually supply products to their domestic market. The BCS report states that in 2021, Asian countries are the leader in exports and imports of semi-finished steel products, however, they tend to trade among themselves, and exports to other countries are negligible. The largest exporter in this region is India with a volume of 5 million tons.

The base was brought under the ceiling

The EU also approved a legal framework for introducing a ceiling on prices for oil transported by sea from Russia to third countries. The cost ceiling itself and the decision to introduce it have not yet been approved.

European companies will be prohibited from transporting, insuring ships and cargo, as well as providing brokerage and other services to companies involved in the transportation of oil and petroleum products from Russia, if the price of such a delivery exceeds the established limit.

Regulations for checking the price of transactions have not yet been developed. The important thing is that the sanctions will also apply to third-country tankers - if a ship owned, for example, by a Chinese company, one day transports Russian oil at a price above the ceiling, then it will no longer be able to receive European insurance, maintenance, etc.

The measures will come into force from the moment the decision on the introduction of price restrictions is made. It is expected that the price ceiling will be introduced on December 5 for oil and on February 5, 2023 for petroleum products. At the same time, the decision of the EU Council states that projects that are important for the energy security of third countries may be temporarily exempted from the new sanctions.

Crypto wallets are closing

The European Union has tightened sanctions against Russia in terms of cryptocurrencies. Companies with a European license are prohibited from opening accounts and crypto wallets for Russians. Previously, there was a limit on the amount of assets - €10,000.

Experts interviewed by Kommersant call the possible blocking of assets the main risk. If a company is registered in the European Union, it is forced to prohibit Russian citizens from using its services, personal accounts and storing cryptocurrencies, Vladislav Utushkin, founder of the ToTheMoon group of companies, explained. “This can affect not only exchanges, but also Ledger and Trezor (companies that issue cold, that is, working from physical media, crypto wallets.— "b"),” he says. Moreover, if the company is not European, then it can also implement this ban if the international community so requires, Mr. Utushkin points out.

This ban, most likely, cannot be bypassed by a regular VPN connection, since centralized exchanges have a KYC (“know your customer”) procedure.

“But if this happens with decentralized exchanges, then a VPN should save,” the expert believes.

Citizens of the Russian Federation should be allowed to withdraw their assets, but freezing of accounts is also possible, Roman Kaufman, co-founder of Berezka DAO, expects. Now, in his opinion, citizens of the Russian Federation can urgently withdraw their assets to a cold wallet or to services such as MetaMask, Trust Wallet and others. Persons who can demonstrate that they have a residence permit and an address in another country will not fall under the restrictions, added Maria Agranovskaya, managing partner of the Grad Bar Association.

However, most likely, there will be exchanges that will not restrict residents of the Russian Federation.

When in the spring many exchanges limited the deposit to €10,000, some of them did not react to this, Mr. Utushkin points out. Huobi and Bybit will remain among the major centralized platforms, said Chen Limin, CFO and Head of Trading Operations at ICB Fund.

“For the exchange of crypto assets, it will be possible to use decentralized analogs of exchanges. The so-called DEXs - Uniswap, PancakeSwap, Curve and others - work on the algorithm of an automatic market maker, and their code does not require KYC verification, ”he said.

Without European lawyers

The ban included legal advice on the application and interpretation of the law, including advice on commercial transactions, in addition, participation on behalf of the client in commercial transactions and negotiations on them, as well as the preparation, execution and verification of legal documents. Lawyers from EU countries will not be able to provide such services to Russian persons, explains EMPP lawyer Mergen Doraev. The restrictions imposed are very wide, points out Natalia Stotskaya, a lawyer at the A1 Bar Association: “The ban on advising on the application or interpretation of the law is not limited to commercial transactions, as is the ban on the preparation and verification of legal documents.”

First of all, Natalia Stotskaya adds, the consequences will be felt by those Russian entrepreneurs and companies whose assets or business are located in the EU.

These sanctions, says Mr. Doraev, in fact, "will exclude the possibility of working with European lawyers on any issues other than judicial and arbitration representation," since it is not prohibited to represent interests in courts and administrative bodies. He notes that the new ban does not contain exceptions for consultations on the application of sanctions, and fears that this will prevent not only sanctioned persons, but any Russian citizens and companies from receiving such advice from lawyers practicing in EU countries.

Computer networks are configured on their own

The eighth package of sanctions includes a ban on the provision of IT consulting services to Russian individuals and legal entities. The ban on the provision of these and a number of other services, in particular legal ones, is intended to "weaken the industrial capabilities of Russia." IT consulting for the purposes of European sanctions, according to the official journal of the EU, refers to consulting services related to setting up computer networks, installing hardware and software (software) or assisting in installation, as well as consulting on the development and implementation of software. The ban on the provision of IT consulting services is also mentioned among the sanctions announced on September 30 by the UK, but so far the relevant acts have not been published.

New sanctions may affect Yandex, VK and other Russian IT companies that are “legally and technically connected with their European structural divisions”, as well as corporate users of foreign software, Natalia Stotskaya believes.

Yandex has a head office Yandex NV registered in the Netherlands, while VK has a subsidiary My.com BV; both companies have structures in other European countries. The companies mentioned declined to comment to Kommersant.

The bans will also affect Russian IT specialists who moved to the EU and earned money by providing services to Russian companies, Mergen Doraev believes: “Such services will become criminally punishable in the EU.” He admitted that now not Russian legal entities, but affiliated companies from neighboring countries can become customers of services, however, such actions can be regarded as an attempt to circumvent sanctions.

Software technical support in itself is unlikely to be regarded as IT consulting, believes Sergey Glandin, partner at NSP law firm: “If a vendor has given a client from Russia a license for a certain period, then, if you rely on the norm, he will be able to continue to provide support. And warranty service cannot fall under prohibitions in any way. ” At the same time, he admits that cloud service providers, in particular, may refuse to work with clients from Russia.

Evgeny Zainullin, Olga Mordyushenko, Ksenia Kulikova, Yuri Litvinenko, Anna Zanina



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