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Preventing circumvention has become more important than ever in light of the terrible events in Ukraine. It is accordingly also the focal point of the 18th sanctions package, which we already discussed in our previous newsletter. One innovation deserves particular attention, as it is highly relevant to corporate practice: the optional administrative mechanism under Article 2a(1aa) of Regulation (EU) No 833\/2014 introduces a new authorisation requirement. Authorities are now given the option of imposing an authorisation requirement for an export to a third country (that is, a country outside both the EU and Russia), where the exporter has been notified by the competent authority of the member state in which it is established that the goods and technology in question are, or may be, intended, wholly or in part, for natural or legal persons, entities, or bodies in Russia, or for use in Russia.<\/p>\n\n\n\n
Companies affected must be expressly notified of this by the authority. This constitutes an administrative act and can be challenged independently. We are awaiting further guidance from the EU on this point.<\/p>\n\n\n\n
In my view, the background to this rule lies in the further development of the so-called “sensitive notices” that have occasionally been issued in the past. Prior to this new rule, such notices represented the “sharpest” tool available for alerting exporters to the risk of circumvention. Since these were merely “notices,” generally issued without detailed reasoning, they have been difficult for companies to act on in practice. Nor are they legally binding, even though companies would be well advised to engage closely with the authorities’ concerns when they are raised. Authorities now have the option, in such a situation, of going a step further and imposing an authorisation requirement. Conversely, however, this also means that, when dealing with “sensitive notices,” it can now reasonably be argued that authorities remain free to impose an authorisation requirement in such a case. This rule thus contributes to clarifying the scope of administrative action.<\/p>\n\n\n\n