The UK government has announced further sanctions against Russia designed to target vulnerable sectors of the Russian economy. The sanctions are a direct response to Russia’s annexation of four regions of Ukraine following referendums held in those areas. Russia imports 67% of its services from countries which have imposed sanctions and these latest sanctions are designed to disrupt Russian supply chains. The measures are being coordinated with international partners, particularly the G7, to ensure maximum impact.
The sanctions will seek to prevent Russian access to the UK’s:
- IT consultancy services;
- architectural services;
- engineering services;
- advertising services;
- transactional legal advisory services; and
- auditing services.
Russia imports 85% of its legal services from G7 countries; of which 59% are from the UK. The new legal advisory restrictions will target certain commercial and transactional services.
As well as targeting the service areas listed above, the following have also been announced:
- a ban on the export of almost 700 goods from the UK to Russia, including hundreds of good which are critical for Russia’s manufacturing sector;
- the suspension of the process by which actions taken to manage the orderly failure of Russian banks are recognised under the laws of the UK, in cases where the bank is a sanctioned entity;
- an asset freeze on the Governor of the Central Bank of the Russian Federation; and
- ongoing negotiations with the G7 to finalise and implement the proposed price cap on Russian oil.
The announcement does not contain any detail on the way these sanctions will be framed, nor on the timeline for when they will come into force. We will provide updates once more details are available.