Since October 2020, the EU has progressively expanded its restrictive measures on Belarus in light of the alleged fraudulent presidential elections that took place in August 2020 and the crackdown by Belarusian security forces on peaceful protesters, democratic opposition and journalists. On 24 June 2021, the EU adopted comprehensive restrictions on a significant part of the Belarusian economy including the tobacco, potash, petroleum, banking and insurance sectors.
On 15 November 2021, the EU amended its sanctions regime on Belarus to broaden the listing criteria on which specific designations can be based (Council Regulation (EU) 2021/1985 and Council Decision (CFSP) 2021/1990). Measures against designated persons include travel bans and an assets freeze.
The EU will now be able to designate individuals and entities organising or contributing to activities by the Lukashenko regime that facilitate:
- the illegal crossing of the EU's external borders; or
- the illegal transfer of restricted goods, including hazardous goods, into the territory of a Member State.
The Council Press Release quoted Josep Borrell, the High Representative for EU Foreign Affairs and Security Policy: “Today's decision reflects the determination by the European Union to stand up to the instrumentalisation of migrants for political purposes. We are pushing back on this inhuman and illegal practice. At the same time, we continue to underline the unacceptable ongoing repression by the regime against its own population at home, and we will respond accordingly.”
In addition, the EU has adopted an exemption to the prohibition on the provision of insurance and re-insurance to the Belarusian Government, its public bodies, corporations or agencies and natural or legal persons acting on their behalf or at their direction (Regulation (EU) 2021/1986 and Council Decision (CFSP) 2021/1989). Specifically, the prohibition does not apply to the provision of compulsory or third party liability insurance to Belarusian persons, entities or bodies where the risk insured is situated in the EU or to the provision of insurance for Belarusian diplomatic or consular missions in the EU. Furthermore, the prohibition is without prejudice to the execution of contracts concluded before 25 June 2021, or ancillary contracts necessary for the execution of such contracts.
These new sanctions may have an impact on EU companies that have exposure to dealings with Belarus or Belarusian entities, who will need to comply with relevant restrictions. Companies doing business in or with Belarus are required to assess their risk exposure to the new measures and take appropriate due diligence measures to allow them to remain compliant.
Hogan Lovells is available to assist you in assessing your exposure and in ensuring compliance with EU sanctions in your transactions.
Authored by Aline Doussin, Imogen Brooks, Iris Karaman.