EU Sanctions’ Two-Way Street: More Pressure on Russia and Belarus, Less on Syria

On 24 February 2025, marking the third year of the Russian invasion of Ukraine, the European Union (“EU”) adopted the 16th package of sanctions against Russia,¹ correspondingly aligned sanctions targeting Belarus,² and reinforced sanctions relating to Crimea/Sevastopol and the non-government controlled areas of Ukraine in the Donetsk, Kherson, Luhansk and Zaprozhzhia oblasts (“Occupied Territories”).³

On the same day, following a political agreement reached at the end of January 2025,⁴ the EU eased sanctions on Syria, with a view to facilitating humanitarian aid and recovery efforts as part of the country’s political transition.⁵

1. Putting further pressure on Russia and Belarus through additional sanctions

1.1 Reinforcing the extra-territoriality of EU sanctions

As part of the 14th Package adopted in June 2024, the EU introduced “best efforts” obligations, requiring EU operators to ensure that non-EU legal persons, entities or bodies (“entities”) they own or control do not participate in activities that undermine certain, but not all, EU sanctions targeting Russia.⁶ These obligations were subsequently replicated in July 2024 in the Belarus sanctions regime.⁷

The texts adopted on 24 February 2025 close the loop by introducing “best efforts” obligations in the main asset freeze regime targeting Russia⁸ and the regimes related to the Occupied Territories.⁹ As a result, “best efforts” obligations are now applicable throughout all main sanctions regimes targeting Russia, with corresponding extra-territorial implications for businesses globally.

1.2 Leveraging the multifaceted threats (and challenges) of EU individual sanctions under the Russia sanctions regimes

As with any sanctions package, the EU designated an additional 48 individuals and 35 entities as subject to travel ban and/or asset freeze measures.¹⁰ The EU also introduced new designation criteria under its Russia and Belarus regimes to target Russia’s shadow fleet and Russia’s and Belarus’ military industrial complex.

But the 24 February texts illustrate the breadth of the EU’s sanctions toolbox and the EU’s readiness to use it in order to address sanctions circumvention or evasion concerns:

• For the first time, the EU designated two Belarusian and one Chinese bank as subject to a transaction ban for being users of the Russian System for Transfer of Financial Messages;
• Thirteen regional Russian banks were designated as subject to prohibitions on the provision of financial messaging services;
• Seventy-four additional vessels were targeted by an EU port ban and a ban on a broad range of activities and services;
• Fifty-three additional entities, inside and outside Russia, were added to the list of parties subject to enhanced export control restrictions in relation to dual-use and advanced technology items; and
• Eight Russian media have been designated as subject to a broadcasting ban, with the effective date to be determined by the Council.

The EU even further expanded its sanctions toolbox by:

• Extending the transaction ban framework targeting listed credit or financial institutions and crypto assets services providers facilitating transactions that support Russia’s defense industrial base to provide for potential transaction bans against providers and institutions (i) involved in frustrating sanctions targeting designated vessels under Annex XLII or (ii) frustrating the oil price cap. Designations would also extend to entities acting on their behalf or at their direction;
• Introducing a new transaction ban framework targeting listed Russian ports, locks and airports, with five ports and six airports already designated; and
• Introducing another transaction ban framework targeting listed air carriers that (i) operate domestic flights in Russia or (ii) supply controlled aircraft or aviation-related items to Russian air carriers or for flights within Russia.

The multiplicity of these different individual sanctions regimes, coupled with the fact that targets can be located both inside and outside Russia, evidences the EU’s willingness to threaten cutting access to the EU market for parties that seek to circumvent, evade or undermine EU sanctions. At the same time, the multiplicity of these regimes, each providing for its own criteria, scope of application, derogations and exemptions, complexify compliance for EU operators.

1.3 Strengthening trade control measures in respect of Russia and Belarus

Export-related restrictions – The EU has, first, clarified that parties identified as subject to enhanced export-related restrictions in relation to dual-use and advanced technology items are indeed subject to full-fledged restrictions,¹¹ even if they are located outside Russia or Belarus, thereby moving closer to a US-like Entity List.

List of items subject to export-related restrictions under Russia and Belarus sanctions have also been extended:

• Additions to the list of advanced technology items include chemical precursors to riot control agents, software related to numerical control (CNC) machines, chromium ores and compounds and video game controllers;

• Additions to the list of industrial items include minerals, chemicals, steel, pyrotechnic, paper, and glass materials; and
• Software used in oil and gas exploration are also now controlled.

Additions were also made to the list of machineries and industrial items prohibited from transiting through Russia and/or Belarus.

Last but not least, as regards Russia only, the EU also introduced catch-all prohibitions on the provision of goods, technology and services for the completion of crude oil projects in Russia, similar to the one existing with regard to the completion of LNG projects.

Import-related restrictions – Russian and Belarusian primary aluminum products are now subject to import-related restrictions. While Russian imports can continue under a one-year quota of 275,000 tons, coupled with wind-down exemptions until the end of 2026, Belarus imports will only be subject to a three-month wind-down exemption.

Additional adjustments were also made to the following import-related restrictions targeting Russia:

• New provisions specifically prohibit the temporary storage and import into free zone of Russian crude oil and petroleum products, regardless of the purchase price and final destination of the products;¹² and
• Evidentiary requirements related to the origin of diamonds imported into the EU, which seek to ensure compliance with the import ban on Russian diamonds, were adjusted, primarily to postpone the mandatory use of traceability-based evidence for certain polished diamonds until 1 January 2026.

1.4 Extending the scope of prohibited professional services and restrictions on controlled enterprise management and industrial design & manufacture software for Russia and Belarus

Prohibited professional services now include construction services, including civil engineering works. While these prohibitions concern all entities established in Russia, only entities acting on behalf or at the direction of the Republic of Belarus, its government, and its public bodies, corporations or agencies are concerned.

As regards controlled enterprise management and industrial design & manufacture software, amendments introduced controls on related IP rights or trade secret transactions.

1.5 Aligning financial restrictions targeting Belarus with those relating to Russia

Amendments were made to (i) extend the prohibitions on deposits above EUR 100,000 to deposits made by non-EU entities owned for more than 50% by Belarusian nationals or residents, (ii) introduce prohibitions on the provision of crypto-related services and (iii) prohibit Belarusian nationals or residents from owning, controlling or holding posts in the governing bodies of EU providers of crypto-asset wallet, account or custody services.

1.6 Preventing circumvention of sanctions targeting road transport undertakings

Measures prohibit any change that would increase the percentage share owned by Russian or Belarusian individuals or entities in the capital structure of EU road transport undertakings established before 8 April 2022 at or above 25%.

1.7 Further restricting access to public and concession contracts for Russia-related persons

The prohibition to award or continue the execution of public or concession contracts now applies to persons acting on or at the direction of Russian nationals or residents.

1.8 Expanding the scope of mandatory compliance requirements under sanctions targeting Russia and Belarus

In line with measures previously imposed in relation to Common High Priority Items, EU operators whose activities involve “generating sets with spark-ignition internal combustion piston engines” and “other switches” will be required as of 26 May 2025 to:

• Implement sanctions compliance policies and procedures to avoid re-exportation to or for use in Russia and Belarus; and
• Ensure that their non-EU subsidiaries do so as well.

1.9 Ensuring the relevance of damage recovery actions regarding (i) claims lodged in third countries in connection with sanctions targeting Russia or Belarus and (ii) Russian counter-measures

Amendments were made to extend the scope of damages that can be recovered and the scope of recovery actions, notably:

• Both direct and indirect damages can be recovered;
• Both damages incurred by EU persons or the entities they own or control can be recovered; and
• Damages can be recovered either from the claimants in third-countries proceedings or from persons who own or control them.

While damage recovery actions are conditioned to a lack of effective access to remedies, amendments clarify that this can result from measures taken by Russia or third countries to impede compliance with EU sanctions.

Furthermore, the jurisdiction of EU courts is extended: EU courts can hear claims for damages outside their jurisdiction if they have a "sufficient connection" to the claimant (e.g., the claimant is domiciled in or incorporated under the law of that Member State).

Finally, the possibility to claim damages as a result of Russian counter-measures has been reinforced:

• Damages can result from (i) placement under temporary administration but also (ii) Russian countermeasures allowing corporate rights of foreign holding structures in economically significant Russian organizations to be restricted, as well as for the direct foreign ownership in such organizations to be acquired by Russian beneficiaries and for them to receive dividends directly; and
• Recovery actions are possible against persons who benefitted from a decision pursuant to these legislations but also (i) persons who are responsible for issuing decisions pursuant to these legislations and (ii) persons, entities or bodies that own or control them.

1.10 Adjusting enforcement-related provisions

Amendments were primarily made to (i) clarify reporting obligations for obliged entities under anti-money laundering rules, emphasizing that suspected violations of EU sanctions must be reported to Financial Intelligence Units (“FIUs”) and allowing Member States to consider such reporting as sufficient to comply with sanctions reporting obligations, (ii) recognize the role of FIUs in sanctions enforcement, (iii) stress the Commission’s role in supporting the private sector, notably with regard to due diligence, and (iv) empower the Commission to share information with partner countries.

1.11 Aligning restrictions relating to the Occupied Territories with those applicable to Russia

Alignments concern (i) export-related restrictions targeting transport, telecommunications, energy, oil & gas and mineral items, (ii) professional services and software restrictions,¹³ (iii) restrictions on export of EU banknotes, (iv) damages recovery actions for claims lodged in third countries, (v) provisions on enforcement, (including on “no liability” clauses, voluntary self-disclosures, penalties and confiscations, anti-circumvention, information exchanges and documents secrecy). 

1.12 Introducing or amending derogations and exemptions

A number of derogations and exemptions were also introduced, adjusted or tightened, notably with regard to (i) asset freeze measures,¹⁴ (ii) export-related restrictions, (iii) import-related restrictions, (iv) professional services restrictions, (v) financial restrictions, (vi) the EU flight ban for Russian-related aircraft for recreational or training purposes, (vii) restrictions on new investments in the Russian mining and quarrying sectors and (viii) restrictions relating to the Occupied Territories.

2. Easing sanctions on Syria

Sanctions are foreign policy tools primarily intended to bring about a change in policy or activity by the target country in line with the foreign policy objectives being pursued. The fall of al-Assad’s regime in Syria has thus incentivized the EU to take steps toward easing sanctions on Syria, although developments in Syria will be monitored to assess whether such steps continue to be appropriate.  Not all sanctions targeting Syria have been lifted, however, and businesses should continue to observe compliance with EU sanctions.

2.1 Suspending specific restrictive measures, primarily in the energy sector

Measures that are currently suspended are:

• Import-related restrictions on Syrian crude oil or petroleum products;
• Export-related restrictions on:

  (i) jet fuel and fuel additives;
  (ii) equipment and technology for the oil and gas industry;
  (iii) new Syrian denominated banknotes and coinage, printed or minted in the Union, targeting the Central Bank of Syria; and
  (iv) certain steam turbines, gas turbines, electric motors and generators to be used in the construction or installation in Syria of new power plants for electricity production.

• Restrictions on financing, namely, loans, credits, acquisition or extension of participations and the creation of joint ventures to, in or with Syrian persons or entities engaged in (i) the exploration, production or refining of crude oil or (ii) the construction or installation of new power plants for electricity production.
• Restrictions on access to EU airports for cargo flights operated by Syrian carriers and all flights operated by Syrian Arab Airlines.

2.2 (Partial) lifting of asset freeze measures

Adjustments to asset freeze measures are as follows:¹⁶

• Four Syrian banks and one airline are no longer subject to asset freeze measures: (i) Industrial Bank, (ii) Popular Credit Bank, (iii) Saving Bank, (iv) Agricultural Cooperative Bank and (v) Syrian Arab Airlines.
• The Central Bank of Syria is no longer subject to comprehensive asset freeze measures. Provisions continue to require the freezing of all funds and economic resources belonging to, owned, held or controlled by the Central Bank of Syria and located outside Syria as of 27 February 2012. However, there is no prohibition on making available funds or economic resources to the Central Bank of Syria.

2.3 Amending exemptions and derogations, primarily to support humanitarian assistance, reconstruction and sectors for which sanctions are suspended

Exemptions and derogations have been amended as follows:

• The “personal use” exemption for luxury goods has been extended;
• The expiry date of the current humanitarian exemption from asset freeze measures has been removed;
• A new exemption has been established to facilitate financial and banking transactions between the EU and Syria:

  The derogation that permitted authorizations to be granted to EU credit and financial institutions to open new bank accounts with Syrian credit or financial institution and to open a new representative office in Syria or to establish a new branch or subsidiary in Syria has been replaced by a broad exemption that permits:

  ○  EU credit and financial institutions to open new bank accounts with Syrian credit or financial institutions, establish new correspondent banking relationships with Syrian credit or financial institutions, open new representative offices in Syria, or establish new branches or subsidiaries in Syria or establish new joint ventures with Syrian credit or financial institutions.
  
  ○ Syrian credit or financial institutions to open representative offices or establish branches or subsidiaries in the EU, take up or pursue the business of credit or financial institution or other businesses requiring prior authorizations, and acquire participations or other ownership interests in EU credit and financial institutions.

Provided that such activities (i) support humanitarian purposes in Syria, (ii) support the Syrian reconstruction or (iii) are performed in connection with certain activities for which restrictive measures have been suspended.