On July 23, the Council of the European Union adopted the 21st package of sanctions against Russia. According to EU High Representative for Foreign Affairs Kaja Kallas, these are the toughest measures taken in the last four years. The document aims to maximally restrict Russia's economic capabilities and its ability to wage war against Ukraine.
Blow to the Financial System and Crypto Assets
Special attention in the new package is paid to the financial sector, which the EU views as a key tool of Russia's war economy. Brussels has significantly expanded measures against Russian banks. Specifically, a ban on transactions with a Kyrgyz bank linked to the Financial Message Transfer System (SPFS) has been introduced, as well as with three other non-Russian banks caught circumventing sanctions.
For the first time in the history of sanctions restrictions, the EU has introduced the possibility of a complete ban on services related to crypto assets for third countries. 14 crypto service platforms have fallen under restrictions. Additionally, the measures affected the A7 cross-border network, including its new links with the African continent.
Oil Sector and "Shadow Fleet"
The sanctions package contains tough measures against the oil industry. The price cap mechanism on Russian oil, which was previously subject to automatic adjustment, is now suspended until July 15, 2027. This is intended to cement restrictions on Russia's income from hydrocarbon exports.
Another 41 vessels have been added to the sanctions list, which, according to the EU, are part of the "shadow fleet." Now, 632 tankers are under restrictions. Additionally, 18 organizations and one individual from the oil sector have been added to the list. Brussels has created a legal basis for banning operations with oil refineries (ORs) both in Russia and in third countries processing Russian crude oil.
A separate item is the ban on deals with a Georgian OR trading and processing Russian oil based on the Kulevi port. This measure will come into force in six months. In addition, the ban on transactions extends to two Russian ports and four Russian airports.
Military-Industrial Complex and Exports
The 21st sanctions package introduces 56 new lists of individuals and companies involved in the Russian military-industrial complex (MIC). Among them are 37 entities directly linked to the production of long-range drones and their supply chains. Another 51 organizations have been added to the list of those subject to strict restrictions on the export of dual-use goods.
The EU has expanded the ban on the export of a number of goods critical to Russian industry, and also introduced additional restrictions on the import of goods bringing Russia significant income (over 60 million euros). Similar measures were taken against Belarus.
Personal Sanctions and Legal Protection
8 individuals have been added to the sanctions list for spreading Russian military propaganda and manipulative narratives. The list also includes a Major General accused of war crimes, torture, and desecration of the bodies of Ukrainian servicemen.
An important innovation is the possibility of introducing a comprehensive visa ban for current and former combatants of the Russian armed forces and proxy groups. The EU Council will need to determine the exact date this measure enters into force.
The package also strengthens legal protection for EU operators, allowing courts of member states not to recognize decisions of Russian courts. Ukraine has already begun preparing the 22nd sanctions package, which will, among other things, feature evidence of the abduction of Ukrainian children.
