New trade and financial sanctions against Russia come into force
UK government legislates for further sanctions on goods, technology, and sources of funding that could support Russia’s war effort.
On 14 December 2023, the UK government introduced legislation to further sanction goods, technology, and sources of funding that could support Russia’s war against Ukraine.
Following Russia’s illegal invasion of Ukraine, the UK and its allies introduced the most severe sanctions ever imposed on a major economy. Imports to the UK from Russia fell by 94% in the year following the invasion, while exports plunged by 74%. This new package of sanctions builds on that record. It bans the export of a range of goods that carry a risk of military or industrial usage, as well as the latest items Ukraine has found on the battlefield, including machine parts and electronics. Given the low levels of UK-Russia trade, these sanctions will ensure we are able to continue depriving Russia of products it could use in its war. In essence, only low-risk, humanitarian, food, and health exports will remain unsanctioned after this.
The legislation also targets products that raise revenue to fund Putin’s war machine. It bans the import of certain Russian metals, as announced by G7 leaders in May. Furthermore, the UK government is introducing separate legislation to ban the import of diamonds from Russia and plans to proceed with a prohibition on ancillary services relating to metals when this can be done in concert with international partners.
The legislation also includes a series of financial measures designed to support businesses that decide to divest from Russia, to clarify and broaden the scope of existing sanctions on correspondent banking. The changes will also introduce new reporting obligations to provide greater transparency of assets held in the UK and improve compliance with the existing sanctions regime. The designated person asset reporting measure enters into force on 26 December.
Based on 2021 trade flows, this package contains new sanctions on £70 million of potential UK exports to Russia and £67 million of imports, plus tightened sanctions on £662 million of exports that are already subject to restrictions.
Further guidance can be found on the Russia sanctions statutory guidance, notices to exporters, and the notice to importers on Russia import sanctions.
The legislation is available:
- 7th trade sanctions package: Russia (Sanctions) (EU Exit) (Amendment) (No. 4) Regulations 2023
- diamond ban: Russia (Sanctions) (EU Exit) (Amendment) (No. 5) Regulations 2023
This legislation follows the launch of the Office of Trade Sanctions Implementation (OTSI) to strengthen enforcement and clamp down on companies dodging Russian sanctions.