On October 19 the European Commission and the High Representative of the EU for Foreign Affairs and Security Policy put forward a Joint Proposal for a Council Regulation concerning implementation of sanctions against serious human rights violations and abuses worldwide. The Joint Proposal for a Council Regulation together with the Council Decision proposed by High Representative Josep Borrell will, once adopted by the Council, establish the EU Global Human Rights Sanctions Regime.

Similar to the 2012 Magnitsky Act in the US, the new sanctions regime will provide the EU with greater flexibility to target those responsible for serious human rights violations and abuses, regardless of where they occur or who is responsible. European Commission President Ursula von der Leyen recently explained that there is a need for such framework in view of the EU’s recent difficulties to impose sanctions on Belarus, Turkey or Russia.

The drafts of the proposed sanctions regime are not yet available. However, the new framework is expected to provide for measures such as asset freezes and travel bans. On the latter, the Joint Proposal would also give, for the first time, the Commission oversight on the implementation of the travel bans. The new framework will not replace existing EU geographic sanctions regimes, some of which already address human rights violations and abuse. It should also be noted that some EU Member States, including Estonia, Latvia and Lithuania, have already adopted restrictive measures, such as travel bans, targeting individuals involved in human rights violations.


Continue Reading European Commission proposes Magnitsky-style sanctions framework

According to public statements of high-ranking representatives, the EU is considering whether to impose new economic sanctions against Turkey. The measures discussed include targeting certain Turkish industry sectors, such as the energy industry.

On November 11, 2019 the Council of the EU  adopted a sanctions framework set forth in Council Regulation 2019/1890 and Council Decision 2019/1894, and subsequently designated two executives of the Turkish oil company TPAO on February 27, 2020, in response to Turkish hydrocarbon drilling activities in what the EU views as Cypriot territorial waters. The sanctions that are currently in place consist of a travel ban to the EU, an asset freeze for persons and entities, as well as a prohibition to satisfy claims for their benefit. In addition, EU persons and entities are forbidden from making funds and economic resources available to those listed.


Continue Reading EU Mulls New Economic Sanctions Against Turkey

Following a joint request from several EU national competent authorities (“NCAs”), the European Commission issued an opinion on asset freeze measures imposed on non-EU entities that are controlled by designated persons targeted by EU Council Regulation No 269/2014. The Regulation concerns restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine (“the Regulation”). In its opinion, the Commission takes position on the interpretation of article 2 of the Regulation, which requires EU operators to freeze all funds and economic resources belonging to, owned, held or controlled by persons designated in Annex I to the Regulation. EU operators are also prohibited from making funds or economic resources available, directly or indirectly, to these designated persons. The guidance provided by the Commission is of particular relevance to credit and financial institutions that may be required to comply with EU asset freeze measures.

The NCAs asked the Commission a number of questions in connection with the interpretation of paragraph 63 of the EU Best Practices Guidance, which sets out the criteria to be taken into account when assessing whether a legal person or entity is controlled by another person or entity. The EU Best Practices are non-binding recommendations which aim to promote the uniform implementation of EU sanctions.


Continue Reading European Commission Provides Guidance on the Scope of the Asset Freeze under the EU’s Ukraine-Related Sanctions

The European Commission has published a Guidance Note on how humanitarian aid related to COVID-19 can be provided to countries and areas that are subject to EU sanctions. The Note provides practical help, in the form of questions and answers (Q&As), on how to comply with EU sanctions when providing humanitarian aid, such as medical assistance and supplies, to fight the COVID-19 pandemic. The first version of the Guidance Note covers Syria. The Commission will update it with further information on other countries subject to EU sanctions, including Yemen, Somalia and North Korea.

EU sanctions targeting Syria are set out in Council Regulation (EU) No 36/2012 – as periodically amended – and consist of a number of sectoral restrictions, such as a prohibition on exporting goods or technology which might be used for internal repression, including chemicals used in chemical attacks, and a prohibition on the local purchase and import of petroleum products. The EU framework provides for a number of exceptions, notably for humanitarian purposes. It also includes individual designations entailing notably the freezing of funds or economic resources of certain persons, entities and bodies (“designated persons”).


Continue Reading European Commission publishes Guidance on the provision of humanitarian aid to fight the COVID-19 pandemic in countries subject to EU sanctions

The department responsible for overseeing EU sanctions policy has been relocated, following a decision by the new European Commission (EC) team led by President Ursula von der Leyen. The supervision of the preparation and implementation of EU sanctions— until now carried out by the Foreign Policy Instrument (FPI), a small EC service integrated within the external action structure of the EU—has been moved to the Directorate General in charge of financial services. This institutional change, which might seem relatively insignificant at first sight, could announce a more assertive European sanctions policy for the years to come and help reduce discrepancies in sanctions implementation at the Member State level.
Continue Reading Institutional Changes May Signal a More Assertive EU Sanctions Policy

On January 14, Germany, France and the UK initiated the dispute resolution mechanism in the Joint Comprehensive Plan of Action (JCPOA) based on Iran’s decision to pull away from its obligations under the agreement. While the European participants see the dispute resolution mechanism as a way to keep the JCPOA alive, triggering the mechanism also serves as the first of several steps that must be taken before UN and EU sanctions could potentially be reimposed. Though the reimposition of sanctions is far from inevitable, it is important to understand the functioning of the dispute resolution mechanism in order to anticipate the timeline of any possible future developments.
Continue Reading Germany, France and the UK begin the JCPOA’s Dispute Resolution Mechanism Process – A Gateway for the Reimposition of UN and EU sanctions?

The European Commission recently published a non-binding Guidance with recommendations on internal compliance programs for dual-use trade controls under the EU Dual-Use Regulation. The Guidance aims to provide a framework to help exporters identify, manage and mitigate risks associated with dual-use trade controls and to ensure compliance with the relevant EU and national laws and

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

The European Commission (the Commission) recently issued draft guidelines on the core elements that European industry should take into account when implementing internal export controls and sanctions compliance programs.  The guidance – which is legally non-binding – will be finalized upon the results of a public consultation providing the opportunity for EU exporters to comment on its core elements.  Companies can participate by responding to a survey until November 15.  It is the intention of the Commission to share the results of this survey with a Technical Expert Group before finalizing its guidance.

Internal compliance programs (ICPs) have long been part of a culture of compliance in the US, but much less so within the European Union.  However, ICPs are increasingly viewed in the EU as a key element for an effective export control system.  While not expressly alluding to ICPs, the EU Dual Use Regulation has encouraged Member States to take into consideration whether a company employs adequate means and procedures for compliance when assessing applications for global export authorizations.  In addition, ICP guidelines have been introduced by some Member States as a tool to better monitor compliance with EU and national export controls.  The EU Dual Use Regulation Recast Proposal formally introduces standardized operational ICPs as part of the assessment in the granting and control of global export authorizations and certain general export authorizations.  In implementing these ICP guidelines, the EU is acting pursuant to the multilateral provisions of the Wassenaar Arrangement that have expressed support for ICPs and for this type of regulatory guidance.
Continue Reading EU Promotes Export Controls and Sanctions Compliance Programs

In response to President Trump’s Executive Order re-imposing certain Iran-related sanctions, summarized in our recent post, the EU has expanded the scope of the EU Blocking Statute to cover certain US Iran-focused sanctions.  On August 7, immediately following the US government’s re-imposition of certain Iran-related sanctions, the Commission Delegated Regulation (EU) 2018/1100 amending the annex to the EU Blocking Statute was published in the EU Official Journal and entered into force.

In addition to the Delegated Regulation, the following two texts relating to the application of the Blocking Statute were published in the EU Official Journal:

  • Commission Implementing Regulation (EU) 2018/1101 which sets out: (i) the process for applying to the Commission for an authorization permitting full or partial compliance with the relevant US sanctions; and (ii) a non-exhaustive list of criteria that the Commission will consider in assessing whether an authorization should be granted; and
  • The Commission’s Guidance Note with non-binding guidance on the application of the revised Blocking Statute. The non-binding guidance covers various aspects of the Blocking Statute, including persons/entities within the scope of the Blocking Statute, its temporal application, effects of the Blocking Statute, recovery of damages arising from the application of US Iran-related sanctions, authorizations to comply with US Iran-related sanctions, etc.


Continue Reading EU Blocking Statute Takes Effect to Counter US Re-Imposed Sanctions on Iran