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Simon Hirsbrunner is a dual-qualified Swiss and German lawyer. His practice involves EU and Swiss regulatory compliance, including advice on economic sanctions against third countries such as Iran, Libya, Syria and Russia. He has particular experience in advising banks on EU and Swiss financial sanctions. Simon is also well-known for his trade policy advice on Swiss-EU relations and he has particular industry expertise in financial services, energy and aviation. He takes a particular interest in the trade policy consequences of Brexit and has published various papers on this topic. Prior to joining Steptoe, Simon occupied various positions in public administration, including the Swiss Federal Office of Justice, the European Commission and the European Free Trade Association – EFTA, bringing more than two decades of experience in EU affairs.

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Concerns about the continued availability of medical equipment in the European Union and uncoordinated attempts by individual EU Member States to block exports of such equipment have prompted the European Commission to become active on two levels.

Regarding trade within the EU, the Commission has taken steps to ensure the unimpeded availability of medical supplies. The EU measures are embedded in the new Guidelines on border management measures to protect public health and ensure the availability of goods and essential services. According to the Commission, the controls put in place by the EU Member States must not undermine the continuity of economic activity and should preserve the operation of supply chains. Therefore unobstructed transport services are key to maintaining the availability of goods. Of primary concern is the transport of essential goods such as protective equipment and supplies, vital medicines, but also food supplies including livestock. Moreover, the Commission calls on the solidarity of EU Member States to preserve the free circulation of all goods and guarantee the functioning of relevant supply chains. No additional restrictions should be imposed on the circulation of goods in the EU Single Market, unless duly justified.Continue Reading EU takes measures regarding trade with medical equipment

The Council of the European Union recently adopted a Decision amending Council Common Position 2008/944/CFSP of December 8, 2008 defining common rules governing control of exports of military technology and equipment. The new Council Decision takes account of the developments at EU and international level since the adoption of the original 2008 Common Position. The Council Decision is accompanied by Conclusions and an updated version of the User’s Guide to Council Common Position 2008/944/CFSP defining common rules governing the control of exports of military technology and equipment.
Continue Reading EU Common Rules on the Control of Exports of Military Technology and Equipment: Council Adopts new Decision, Conclusions and a Revised User’s Guide

On 17 May 2019, the Council of the EU established a framework against external cyber-attacks which constitute an external threat to the EU or its Member States. The new rules, which reportedly follow a diplomatic push by the UK and the Netherlands, provide for a strong legal instrument to deter and respond to cyber-attacks against the EU or its Member States. The new framework enables the EU for the first time to impose sanctions against persons, entities and bodies because of cyber-attacks. While no names have been added to the sanctions list yet, the new mechanism is expected to allow the EU to move quickly in the future. However, the new framework does not help companies that are under attack. Victims of cyber-attacks are on their own when it comes to fighting off a cyber-attack.

Sanctions under the new framework are country neutral. In other words, they do not target specific third countries but specific malicious actors. Member States are free to make their own determinations with respect to the attribution of responsibility for cyber-attacks to third countries but such determinations have no impact on the EU sanctions.
Continue Reading New EU Framework to Target Malicious Cyber-Attacks from Outside the Union

Germany has recently boosted its control over undesired foreign investments by introducing an amendment to its Foreign Trade and Payments Ordinance, which complements the Foreign Trade and Payments Act. Under the new rules, the acquisition by foreign investors of significant shareholdings in German companies will be subject to an enhanced government control from a public policy and security viewpoint. The Ordinance increases the power of the German Ministry for Economic Affairs and Energy (BMWi) to review investments that result in the acquisition of a direct or indirect participation corresponding to 25 percent or more of the voting rights in a German company.

Under German law, two different procedures exist for investment review, depending on the industry at stake. On the one hand, special rules apply to the acquisition of companies operating in sensitive security areas. The Ordinance brings clarification in this regard and defines new categories of transactions that are subject to a reporting obligation. Such categories include acquisitions of German operators of critical IT infrastructure, developers of software for the operation of critical infrastructure in certain specific industry such as the energy and water, telecommunications and data storage, transport, health, food, as well as financial services. The new Ordinance also expands on the transactions in the defence industry and related industries that are subject to a reporting obligation.
Continue Reading Towards a German CFIUS copycat? More scrutiny on foreign investments in German companies

The recently reported resignation of cement manufacturer LafargeHolcim’s CEO has thrown a spotlight on the risks of operating commercial activities in countries targeted by economic sanctions.[1] Without drawing any conclusions on the legal qualification of LafargeHolcim’s conduct in the specific circumstances, the following provides an overview of the principal issues at stake in this case.

Background

In June 2016 the French newspaper Le Monde published allegations against French cement manufacturer Lafarge SA, now part of the merged Franco-Swiss entity LafargeHolcim, concerning its alleged involvement in indirectly financing terrorist groups, chief among them the jihadist so-called ‘Islamic State’ (‘ISIS’) in Syria from 2011 to 2014.

Lafarge had acquired Egyptian cement company Orascom in 2007 and, as a consequence, became involved in the operation of several factories in the Middle East. Its Syrian subsidiary’s (Lafarge Cement Syria – LCS) factory reopened only a year before violent protest, escalating into civil war, erupted in Syria in 2011. LCS’s headquarters were located in Damascus, and the factory in question in the Northern district of Raqqa, which in 2012 came under the control of armed groups and thereafter under the control of ISIS. As the armed groups and rebel forces within the region became increasingly radicalised, it is reported that weekly crisis meetings, of which Lafarge’s Parisian headquarters were apparently kept informed, became daily crisis meetings.

While expatriate employees had been evacuated by 2013, most Syrian employees remained at the factory until it was finally closed at the end of 2014. LCS faced a total of four cases of employees being kidnapped –who were eventually released upon ransom payments.
Continue Reading Between a rock and a hard place: How to ensure sanction compliance when operating a facility in a sanctions-targeted country