EU steps up efforts to clamp down on Russia sanctions evasion
Whack-a-mole
The EU’s 11th package of sanctions on Russia is meant to be an exercise in closing down loopholes. But that doesn’t mean it will be easy to land, write Sam Fleming and Andy Bounds.
Context: EU members want to further tighten the noose around key sectors of the Russian economy. But with little left to hit there, the discussions have focused on countering sanctions evasion through third countries.
Among the most radical ideas is a mechanism that would allow the EU to restrict sales of certain products to other third countries that then leak into Russia.
Critics, however, fear that targeting countries through which banned goods transit could alienate them. “We want to do this in such a way that we don’t push those third countries towards China or Russia,” an EU diplomat said.
According to the text, which will need to be unanimously approved by member states, the bloc would first try to counter circumvention through diplomatic means, using more restrictive measures for certain goods as last resort.
The sanctions would, if approved, also explicitly target a handful of companies in countries including China, because of claims they are selling equipment that could be used in weapons. Member state representatives will discuss the draft on Wednesday, and it could still change.
Other parts of the proposed package focus on ironing out wrinkles and listing dozens of new individuals and entities.
Brussels has, for example, proposed ending the temporary exemption from the Russian oil embargo for the north Druzhba pipeline to Poland and Germany.
The proposed sanctions also include ending the transit of certain goods through Russia and fresh export controls for newly identified dual-use goods.
More controversial proposals such as imposing sanctions on the Russian nuclear sector did not make it into the current text.
Still, expect lengthy discussions. “Experience has shown that these proposals need to be studied in detail,” one senior EU diplomat said.