EU extends economic sanctions against Russia

On Monday, the European Council formally extended sanctions against companies from several sectors of the Russian economy. The restrictions were extended for six months, from 31 January to 31 July 2017.

European leaders (the European Council consists of the heads of States and governments members of the EU) once again confirmed its principle is to bind the sanctions regime to the full implementation of the Minsk agreements of February 2015.

Formally, the agreement on the extension of sanctions was reached on 15 December, during the summit of the European Council. It is reported that all heads of state and government single-handedly supported the extension of restrictions. If the situation in Eastern Ukraine does not improve, following the decision to extend the sanctions to expect at the summit of the European Council on 22-23 June 2017 last meeting before the expiry of their actions.

Sectoral sanctions against Russia from the EU was introduced in July 2014 and extended in September 2014. These measures are in three main areas.

First, it is restricting access to European financial markets leading state-owned banks, energy and military companies and their “daughters”. Further, the restrictions on the arms trade. Finally, the ban on trade in dual-use goods and technologies for the oil sector.

In addition, it remains in force for personal sanctions against people and companies linked to the Ukrainian crisis (valid until 15 March 2017) and a separate set of restrictive measures against the Crimea (valid till 23 Jun 2017).

In response to sectoral sanctions, in early August 2014, Russia imposed an embargo on the supply of certain food products from Western countries. In the summer of 2016, the ban was extended until the end of 2017.

According to government draft budget for 2017-2019, the Russian authorities expect that Western sanctions will not be lifted during this period.