On 27 April, in line with its announcement from 13 April, the Swiss Federal Council imposed further sanctions against Russia and Belarus (see blogpost here). Through these latest revisions of both the Ordinance on Measures connected with the Situation in Ukraine (the “Ukraine Ordinance“) and the Ordinance on Measures against Belarus (the “Belarus Ordinance“), Switzerland has adopted the EU’s latest package of sanctions with a few exceptions (see blogpost here). The new measures entered into force on 27 April at 6 PM CET.
The list of designated individuals and entities targeted by restrictive measures was already updated on 13 April to align with that of the EU, with such updates including four key Russian banks, prominent oligarchs, business people and high-ranking Kremlin officials, as well as family members of already sanctioned individuals.
I. Russia
TRADE RESTRICTIONS
Restrictions on aviation jet fuels and fuel additives
In addition to the previously introduced restrictions to aviation or space industry goods and technology listed in Annex 3 of the Ukraine Ordinance, the sale, delivery, export or transit of jet fuels and fuel additives as listed in Annex 19 of the Ukraine Ordinance to or for use in Russia is now also prohibited. Such exports to the Ukraine are subject to authorisation. Standard prohibitions on the provision of technical and financial assistance apply as well.
Restrictions on goods intended for industrial strengthening
Switzerland now also prohibits the sale, supply, export, transit or transport of goods intended for industrial strengthening as listed in Annex 23 of the Ukraine Ordinance to or for use in Russia. Standard prohibitions on the provision of technical or financial assistance apply as well. Annex 23 of the Ukraine Ordinance lists a variety of goods, including chemical products and industrial robots among others.
The prohibitions do not apply to goods and services required for the official activities of diplomatic or consular representations of Switzerland or its partners in Russia or international organizations.
A wind-down provision has been included, stating that the above-mentioned prohibitions do not apply to the execution of contracts concluded before 28 April 2022 and fulfilled by 29 July 2022.
Restrictions on solid fossil fuels
It is now prohibited to purchase, import, transit and transport coal and other solid fossil fuels as defined in Annex 22 of the Ukraine Ordinance from or originating in Russia. Standard prohibitions on the provision of technical and financial assistance apply as well.
A wind-down provision has been included, stating that the above-mentioned prohibitions do not apply to the execution of contracts concluded before 28 April 2022 and fulfilled by 29 August 2022.
Restrictions of economically important goods
The purchase, import, transit and transport of goods of economic significance to Russia as listed in Annex 20 of the Ukraine Ordinance from or originating in Russia is now prohibited. Standard prohibitions on the provision of technical and financial assistance apply as well. Annex 20 of the Ukraine Ordinance lists, inter alia, various seafood, wood and wood products, products of cement, concrete and cast stone, as well as liquor products.
Annex 21 of the Ukraine Ordinance sets out certain import quotas under which the restrictions on economically significant goods do not apply. Furthermore, a wind-down provision has been included, stating that the above-mentioned prohibitions do not apply to the execution of contracts concluded before 28 April 2022 and fulfilled by 29 July 2022.
Additional restrictions on goods for military and technological reinforcement or for the development of the defence and security sector
Existing sanctions included a prohibition on the sale, supply, transfer or export, directly or indirectly, of goods and technology which might contribute to Russia’s military and technological reinforcement or for the development of the defense and security sector, as listed in Annex 1 of the Ukraine Ordinance.
In line with the EU, Switzerland has included a new category of goods in Annex 1 of the Ukraine Ordinance titled “Various Goods”. This list includes, inter alia, equipment for oil production or exploration, microscopes and related equipment and detectors, as well as equipment, “electronic assemblies” and components, specially designed for quantum computers.
FINANCIAL SANCTIONS
Designated parties
The provisions on asset freezes of designated parties and the prohibition on transferring funds or economic resources to designated parties listed in Annex 8 of the Ukraine Ordinance have been supplemented with further exceptions. SECO may now especially authorize the release of certain frozen funds or economic resources or the making available of certain funds or economic resources to a designated party of the Ukraine Ordinance for the purpose of selling or transferring ownership rights in legal persons, entities or bodies established in Switzerland or EEA Member States until 28 October 2022. Such exemptions may only be granted if such ownership rights are owned, directly or indirectly, by the designated party and the proceeds from the sale or transfer remain frozen.
Expansion of the prohibition on taking deposits and inclusion of crypto-based assets
The previously imposed prohibition on the acceptance of deposits of over CHF 100’000 from Russian citizens, natural persons residing in Russia or Russian banks, entities or organizations has been expanded beyond only banks and is now directed at all persons and entities that accept deposits and grant loans on a professional basis.
Additionally, the provision of services related to crypto wallets, crypto accounts or custody of crypto assets to such natural or legal persons listed above by persons or entities providing such services on a professional basis is prohibited if the total value of the crypto assets per wallet, account or custody service provider exceeds CHF 10’000.
Prohibitions concerning the support of public institutions
The direct or indirect provision of assistance, in particular through the granting of financing, financial assistance or other benefits under a Swiss national program, to legal persons, undertakings or entities established in the Russia which are controlled by a governmental entity or in which a governmental entity has a participation of more than fifty per cent, is now prohibited. This prohibition is subject to certain exceptions including humanitarian activities, the operation, maintenance and decommissioning of civil nuclear facilities, as well as diplomatic and consular representative activities.
This prohibition does not apply to the execution of contracts concluded before 28 April 2022 and fulfilled by 29 July 2022.
Prohibitions concerning trusts
The new measures include a prohibition on the establishment of trusts or similar legal forms and the provision of a registered office, business or administrative address or administrative services for trusts if the following persons, entities or bodies are settlors or beneficiaries:
- Russian nationals or natural persons resident in Russia;
- Legal entities, companies or organizations established in Russia;
- Legal persons, undertakings or entities in which natural or legal persons, undertakings or entities referred to in letters a. and b. have a direct or indirect participation of more than 50%;
- Legal persons, undertakings or entities controlled by any of the natural or legal persons, undertakings or entities referred to in letters a.-c.;
- Legal persons, undertakings or entities acting on behalf of a natural or legal person, undertaking or entity referred to in letters a.-d.
It is furthermore prohibited to act as a trustee, nominal shareholder, director, secretary or in any similar capacity for a trust or similar legal form or to enable any other person to do so. The abovementioned prohibitions do not apply if the founders or beneficiaries are Swiss nationals or nationals of an EEA member state or hold a temporary or permanent residence title in Switzerland or an EEA member state. SECO may grant further exemptions in coordination with the relevant national authorities.
The abovementioned prohibitions shall not apply to transactions necessary to terminate contracts that are inconsistent with these provisions entered into before 28 April 2022 by 29 May 2022.
TRANSPORT RESTRICTIONS
The EU has further adopted a ban on any Russian and Belarusian road transport companies to transport goods by road within the EU, including transit, as well as a prohibition on providing access to EU ports to vessels registered under the flag of Russia. Switzerland has not adopted these measures as they are not necessary due to its geographic location. The Ukraine Ordinance does, however, include a new provision prohibiting the taking off from and landing on the territory of Switzerland and flying over Swiss territory for:
- Aircrafts of Russian air carriers with an operating license or equivalent from the Russian authorities, including aircraft operated by these carriers under code-share or blocked-space arrangements; and
- Aircrafts registered in Russia or owned, chartered or otherwise controlled by natural or legal persons, entities or bodies in Russia.
The newly adopted measures further include:
- An exemption for chemical weapons under the exports restrictions for special military goods, so that Switzerland is able to fulfil its international obligations to the Organization for the Prohibition of Chemical Weapons (OPCW).
- The expansion of the restrictions on goods used for oil refining to include goods for natural gas liquefaction.
- The introduction of the possibility for SECO to grant exemptions from the export ban on luxury goods for cultural goods if they are on loan as part of an official cultural cooperation with Russia.
- The existing bans on the export of banknotes and the sale of securities in Swiss francs and in euros to Russian nationals or residents or entities have been expanded to include all official currencies of EU member states.
- Several provisions have been updated to remove exemptions concerning coal, as this is now also a restricted good.
Finally, it is important to note that the EU ban concerning the award of public contracts to Russian nationals and organizations or entities established in Russia has not been included in the revised Ukraine Ordinance yet due to questions raised with regard to the allocation of competences between the Confederation and the cantons and the scope of application. The Federal Council has commissioned a report on this matter with the competent authorities which shall be presented by the end of June 2022.
II. Belarus
The existing bans on the export of banknotes and the sale of securities in Swiss francs and in euros to Belarusian nationals or residents or entities have been expanded to include all official currencies of EU member states.
