Russia/Ukraine Sanctions Update - Month of January 2025

US Sanctions | EU Sanctions | UK Sanctions | Russia/Ukraine Sanctions | Other Notable Developments

I.  US SANCTIONS

• U.S. Department of the Treasury Takes Action Against Russian Efforts to Evade U.S. Sanctions: On January 15, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) designated individuals and entities determined to be part of a sanctions evasion scheme established between actors in Russia and the People’s Republic of China to facilitate cross-border payments for sensitive goods. OFAC also designated a Kyrgyz Republic-based financial institution, Keremet Bank, alleged to have coordinated with Russian officials and a U.S.-designated bank to implement a sanctions evasion scheme. Finally, OFAC redesignated several entities linked to Russia’s financial services, energy, and defense sectors pursuant to Executive Order (“E.O.”) 13662, and, as a result, foreign persons, including foreign financial institutions, that knowingly facilitate significant transactions for or on behalf of any of these entities could be subject to mandatory secondary sanctions. Read more >>
• U.S. Department of the Treasury Increases Sanctions on Russia’s Oil Production and Exports: On January 10, OFAC, in line with the U.S. G7 commitment to reduce Russian revenues from energy, sanctioned two Russian oil producers, dozens of oil traders, oil service providers, insurance companies, energy officials, and an “unprecedented number of oil-carrying vessels,” more than 180, determined to be part of Russia’s “shadow fleet.” Read more >>
• U.S. Department of the Treasury Sanctions Russian Judge: On December 31, OFAC sanctioned Russian judge, Olesya Mendeleeva, after determining her role in the “arbitrary detention of Moscow city councilor and human rights defender, Alexei Gorinov.” Mendeleeva was designated pursuant to E.O. 13818, “Blocking the Property of Persons Involved in Serious Human Rights Abuse or Corruption,” which “builds upon and implements the Global Magnitsky Human Rights Accountability Act and targets perpetrators of serious human rights abuse and corruption around the world.” Read more >>
• U.S. Department of the Treasury and Department of State Issue New Russian Energy and Petroleum Determinations: On January 10, the Department of the Treasury, in consultation with the Department of State, also issued two new determinations relating Russia’s energy and petroleum sectors. First, the Treasury Department issued a determination, Energy Sector of the Russian Federation Economy, pursuant to E.O. 14024, “Blocking Property With Respect To Specified Harmful Foreign Activities of the Government of the Russian Federation,” which authorizes the imposition of economic sanctions on any person determined to operate or have operated in the energy sector of the Russian Federation economy. This determination took effect on January 10, 2025. Second, the Treasury Department issued a determination, Prohibition on Petroleum Services, pursuant to E.O. 14071, “Prohibiting New Investment in and Certain Services to the Russian Federation in Response to Continued Russian Federation Aggression,” which prohibits the provision of U.S. petroleum services to persons located in the Russian Federation. This prohibition is set to take effect beginning at 12:01 a.m. eastern standard time on February 27, 2025. Read more >> and Read more >>
• U.S. Justice Department Announces Guilty Plea for Violations of Russian Sanctions: On January 16, the Justice Department announced the guilty plea of a Miami real estate broker for alleged violations of sanctions and money laundering through the transfer, sale, and lease of several luxury condominiums owned by two U.S. sanctioned individuals, Perevalov and Abramov. Two properties, with a combined value of approximately $1.8 million, owned by Perevalov were seized by the Justice Department on January 7. Read more >> and Read more >>
• U.S. Justice Department Announces Sentencing Relating to Multimillion-Dollar Russian Export Control Scheme: On January 8, the Justice Department announced a Canadian national was sentenced to 40 months in prison for his role in a global procurement scheme that “circumvented U.S. export control laws, used intermediary front companies to hide their crimes, and sold sophisticated electronics to Russia for use in its weapons platforms and signals intelligence equipment.” Read more >>
• U.S. Announces Significant Military Assistance for Ukraine: On January 9, the Department of State announced $500 million in additional assistance to Ukraine. The assistance includes AIM-7, RIM-7, and AIM-9M missiles for air defense; air-to-ground munitions; support equipment for F-16s; armored bridging systems; secure communications equipment; small arms and ammunition; and spare parts, ancillary equipment, services, training, and transportation. Read more >>
• U.S. Disburses $3.4 Billion in Direct Budget Support for Ukraine: On December 30, the U.S. disbursed $3.4 billion in direct budget support for Ukraine, which marks the final disbursement of funds under the Ukraine Security Supplemental Appropriations Act of 2024. Read more >>

II.  EU Sanctions

• EU Sanctions Three Russian Individuals Responsible for Cyberattacks: On January 27, the EU added three Russian individuals to the list of persons subject to asset freeze and travel ban measures under the EU horizontal cyber sanctions regime. The individuals listed are officers of the General Staff of the Armed Forces of the Russian Federation (GRU) Unit 29155 and are responsible for a series of cyberattacks carried out against the Republic of Estonia in 2020. Read more >> and Read more >>
• EU Extends Sanctions Against Russia for a Further 6 Months: On January 27, the EU renewed the EU restrictive measures in view of the Russian Federation’s continuing actions destabilising the situation in Ukraine until 31 July 2025. These economic measures currently consist of a broad spectrum of sectoral measures, including restrictions on trade, finance, energy, technology and dual-use goods, industry, transport and luxury goods. They also cover: a ban on the import or transfer of seaborne crude oil and certain petroleum products from Russia to the EU, a de-SWIFTing of several Russian banks and the suspension of the broadcasting activities and licenses in the European Union of several Kremlin-backed disinformation outlets. Additionally, specific measures enable the EU to counter sanctions circumvention. Read more >>
• EU General Court Upholds EU Sanctions Against Two Individuals: On January 15, and on January 22, the General Court dismissed actions for annulment brought respectively by Andrey Melnichenko and Viatcheslav Moshe Kantor against their listing. Read more >> and Read more >>
• EU General Court Upholds EU Sanctions Against a Russian Mobile Telephone Operator: On January 15, the General Court dismissed action for annulment brought by MegaFon, one of the principal mobile telephone and telecommunications operators in Russia, against its listing. The General Court stated that the Council did set out the actual and specific reasons why it decided to apply restrictive measures to MegaFon. The General Court also noted that the Council was under no obligation to hear MegaFon before including it on the list. Finally, the General Court considered that although the measures at issue limit MegaFon’s freedom to conduct a business and affect its reputation, they do not constitute a disproportionate and intolerable interference. Read more >>
• Lithuania Investigates Supply of High-Tech Equipment to Russia: Lithuania has initiated a pre-trial investigation into the illegal supply of high-tech equipment from Lithuania to Russia, allegedly organized by a Russian citizen with a temporary residence permit in Lithuania. The investigation, which involves cooperation with law enforcement authorities in Latvia and Estonia and coordination with Eurojust, has led to the arrest of several individuals and the detention of the Russian citizen for one month. The investigation revealed that Russian entities are circumventing international sanctions by using complex intermediary chains and third-country companies to acquire Lithuanian high-tech products for their security and defense industries. Read more >>
• Travelers Crossing from Estonia into Russia Caught Carrying Banned Goods: Estonian customs officials have reported that luxury goods, particularly those purchased with euros, are the most frequently confiscated items at the border with Russia. The increase in confiscations is attributed to the sanctions imposed on Russia, which have led to a rise in attempts to smuggle high-value items. Read more >>
• EU Plans Ban on Sales of Video Game Kit to Russia: The EU is proposing a ban on the sale of video game equipment to Russia to prevent its use in controlling drones in the Ukraine conflict. This measure, part of a new round of sanctions, aims to coincide with the third anniversary of Russia's full-scale invasion of Ukraine. The sanctions will also target chemicals needed for the Russian military industry and impose further restrictions on liquefied natural gas imports from Russia. Read more >>
• Russian Smugglers Import Luxury Cars from Europe Despite Sanctions: Russian smugglers are reportedly charging exorbitant fees to import luxury cars from Europe, circumventing EU sanctions imposed in response to Russia's invasion of Ukraine. Multiple Russian companies have been identified as involved in this illicit trade, with cars often routed through third countries like Turkey, Georgia, and South Korea to evade restrictions. Despite the imposition of stricter sanctions, certain European cars continue to find their way into Russia, often without the knowledge of the original sellers. Read more >>
• OLAF Conducts Training in Moldova to Strengthen Fight Against Circumvention of EU Sanctions: On January 22, the European Anti-Fraud Office (OLAF), in collaboration with the European Union Border Assistance Mission to Moldova and Ukraine (EUBAM) and Moldovan Customs, delivered a high-level training session aimed at enhancing Moldova’s capacity to combat the circumvention of EU sanctions. The initiative is part of OLAF’s ongoing mission to strengthen international collaboration on the enforcement of EU sanctions. OLAF plays a key role in this process by investigating cases of sanctions circumvention, monitoring trade flows and sharing intelligence with national authorities and international stakeholders. Read more >>

III.  UK Sanctions

• OFSI Amends General Licence Relating to the Oil Price Cap: On January 29, OFSI amended General Licence INT/2024/4423849, which permits the provision of certain services in relation to Russian oil or oil products subject to certain conditions, including compliance with the oil price cap and certain record-keeping and attestation requirements.  The amendment to the General Licence updated Combined Nomenclature (CN) / Harmonized System (HS) commodity code for "Premium to Crude" which now falls under the commodity code "2710 19 42." Read more >> and  Read more >>
• UK Government Amends Guidance on Reporting a Suspected Breach of Trade Sanctions: On January 24, the Office of Trade Sanctions Implementation (OTSI) updated its guidance on reporting suspected breaches of trade sanctions.  The update provides guidance where a report relates to a person or business other than the reporting person. Read more >>
• UK Court of Appeal Dismisses Anzhelika Khan’s Appeal to Overturn Sanctions: On January 24, the UK Court of Appeal ("UKCA") dismissed an appeal from Anzhelika Khan to overturn her designation as a UK sanctions target under the Russia regime.  Mrs Khan, a Russian-born British citizen, was designated under the Russia sanctions regime on  April 21, 2022 for having obtained a "financial benefit or other material benefit" from her husband, German Khan, an oligarch and co-founder of Alfa Group, a Moscow-based conglomerate which controls the largest commercial bank and biggest food retailer in Russia.  The UKCA did not accept Mrs Khan's argument that her designation was not related to the sanctions' purpose, ruling that less intrusive measures would compromise the objective of the sanctions regime. Read more >>, Read more >>
• UK Government Reveals it Has 318 Open Investigations into Breaches of Russia Financial Sanctions: On January 23, the UK Government stated that: (i) OFSI currently has 318 investigations open relating to potential breaches of the Russia sanctions regime; and (ii) OFSI has investigated and closed 388 cases relating to potential breaches of the Russia sanctions regime since February 2022. Read more >>
• UK Publishes Briefing Paper on Sanctions Against Russia: On January 21, a House of Commons research briefing was published on sanctions against Russia from February 2022 to January 2025. The briefing provides an overview of the sanctions that have been imposed on Russia between February 2022 and January 2025 by the UK, EU, US and other major allies and partners. Read more >>
• UK Supreme Court Hears Appeal Relating to Detained Superyacht M.V. Phi: On January 16, the UK Supreme Court ("UKSC") heard an appeal from Dalston Projects Ltd and others challenging the decision by the UK Secretary of State for Transport (“SST”) to detail a luxury yacht, “the Phi” under the Russia regime.  The beneficial owner of the yacht, Sergei Naumenko, is not a UK sanctions target.  The appeal considers whether the SST’s decision to detain the yacht under the UK’s Russian sanctions regime should be set aside on (i) human rights, or (ii) public law, grounds. Judgment is awaited. Read more >>
• UK Supreme Court Hears Shvidler De-listing Appeal: On January 15, the UK Supreme Court ("UKSC") heard an appeal from Eugene Shvidler relating to his designation under the Russia regime. Mr Shvidler, a US-British dual national was designated under the Russia regime on 24 March 2022 for being (i) a business partner of Mr Abramovich, and (ii) a former longstanding non-executive director of Evraz, a UK listed company steel manufacturing and mining company.  The appeal considers two main issues: (1) did the UK Court of Appeal adopt the wrong approach to determining whether Shvidler’s designation was a proportionate interference with his rights under the European Convention on Human Rights (ECHR); and (2) was the Court of Appeal wrong to conclude that maintaining Shvidler’s designation was not a breach of his rights under the ECHR? Judgment is awaited. Read more >>
• UK Government Amends One Entry on the UK Sanctions List under the Russia Regime: On January 15, OFSI amended the entry for Gazprom Neft on the UK sanctions list under the Russia regime. The entry for Gazprom Neft was also updated on January 14, 2025. Read more >>, Read more >> and Read more >>
• OFSI Issues Interim Basic Necessities General Licence for Designated Persons: On January 14, OFSI issued General Licence INT/2025/5632740, which authorises persons to make up to £350 worth of funds available to or for the benefit of a UK Designated Person ("UK DP") in each of the two months following the date of the UK DP’s designation for certain basic necessities, subject to certain terms and conditions.  This General License will expire in respect of each UK DP at 23:59 on either the day a specific basic needs licence in respect of that UK DP takes effect, or the day two months after the date of designation of that UK DP (whichever is earlier).  This General Licence applies across UK autonomous sanctions regimes, as indicated in the Annex to the licence.  Read more >> and Read more >>
• UK Government Adds Two Russian Oil Companies to the UK Sanctions List under the Russia Regime: On January 10, OFSI added PJSC Surgutneftegas and Gazprom Neft to the UK sanctions list under the Russia regime.  According to the UK Government, these sanctions target entities involved in supporting the Government of Russia by carrying on business in a sector of strategic and economic significance to the Government of Russia, namely the Russian energy sector. The entities are large Russian oil companies which are involved in oil exploration, production, and development. Read more >> and  Read more >>
• OFSI Issues General Licence Relating to Russian Oil Exempt Projects: On January 10, OFSI issued General Licence INT/2025/5635700, which authorises the continuation of business operations with certain Russian energy companies in connection Sakhalin-2, subject to certain terms and conditions. Read more >> and Read more >>
• OFSI Issues Wind Down General Licence Relating to Gazprom Neft and PJSC Surgutneftegas: On January 10, OFSI issued General Licence INT/2025/5635701, which authorises the wind down or divestment of positions involving Gazprom Neft, PJSC Surgutneftegas and/or any entity owned or controlled by Gazprom Neft and PJSC Surgutneftegas, subject to certain terms and conditions. The general licence expires on February 27, 2025. Read more >> and Read more >>
• OFSI Amends General Licence Relating to Payments for Statutory Audits: On January 10, OFSI amended paragraph 4 of General Licence INT/2024/4888228 to clarify that Statutory Auditors may receive Permitted Payments (as defined in the General Licence) made by UK designated persons or persons acting on behalf of designated persons. Read more >>
• OFSI Amends General Licence Relating to VTB Capital PLC: On January 8, OFSI amended General Licence INT/2022/1280876 to add Permission 5.3A, which statesinter alia that no distributions on VTB Bank PJSC’s claim should be made without first deducting from the distributions the value of any VTB Capital plc assets which have been or are subject to VTB Bank PJSC enforcement action.  The General Licence expires on 3 April 2030. Read more>>
• UK Government Amends Two Entries on the UK Sanctions List under the Russia Regime: On January 8, the UK Government updated the entries for Zapchasttrade LLP and Vyacheslav Vladimirovich Ruksha on the UK sanctions list under the Russia regime.  Each remains subject to an asset freeze.  Read more>>
• OTSI Publishes Russian Sanctions Circumvention and “No Russia Clause” Guidance:  On January 7, the UK Government published new guidance for exporters on countering Russian sanctions evasion.  The guidance includes: information on the range of goods at heightened risk of being diverted to Russia; red flag indicators of potential sanctions evasion via circumvention; suggestions for compliance best practice and enhanced due diligence procedures; and additional resources to aid businesses in managing their risk and meeting their compliance obligations. The UK Government also published “No-Russia clause” guidance, which aims to support businesses in tailoring due diligence within exporter contracts and support those wishing to insert a “no re-export to Russia” clause. Read more>> and Read more>>

IV.  Russia/Ukraine Sanctions

• Ukraine Imposes Sanctions on Top Ukrainian Pro-Russia Politicians: On January 19, President Zelensky signed a decree imposing new sanctions on 18 pro-Russian politicians and propagandists.  Among the politicians are Yuriy Boyko (the former Vice Prime Minister), Nestor Shufrych (who was charged with treason in September 2023 for leading a pro-Russian political party), and Yevhen Muraiev.  In a press release, Zelensky said "we are blocking propagandists working for Russia, people who have gone over to the enemy's side, and those who help Russia continue the war." Read more>> 

V.  Other Notable Developments

• Japan Approves Additional Sanctions Against Russia: On January 10, Japan’s Cabinet approved additional sanctions against Russia over its war on Ukraine, including freezing the assets of dozens of individuals and groups and banning exports to dozens of organizations in Russia and several other countries that have allegedly helped it evade sanctions. Chief Cabinet Secretary, Yoshimasa Hayashi, said the approval of the additional sanctions shows Japan’s commitment to efforts by the G7 to strengthen sanctions against Russia. Read more>>