Trade Sanctions – Page 9 – European Sanctions Enforcement

April 25, 2024May 16, 2024 by Mark Handley

United Kingdom – HMRC issues £2.3m in compound penalties for sanctions and export controls breaches

His Majesty’s Revenue and Customs, the body empowered to enforce export controls and trade sanctions in the UK, has today published two Notices to Exporters setting out compound penalties in relation to Russian sanctions and export control violations.

The first Notice, in relation to an unnamed company, relates to a penalty of £1,058,781.79 imposed for breaches of the UK’s Russian sanctions regulation.

No information is given as to the nature of the conduct, the value of the goods, or why a criminal prosecution was not brought. There is no mention of a confiscation of the proceeds of crime.

The second Notice relates to export control violations that are not described as breaches of the UK’s sanction. Again no information is given as to the names of the companies, the nature of the violations, or an indication given as to the confiscation of the proceeds of crime.

To quote the Notice:

“The 6 settlements made by UK companies were:

- January 2024 – £12,700.00 was paid for a breach of licence conditions in relation to the export of military goods
- February 2024 – £33,822.64 was paid relating to the unlicensed exports of military goods controlled by The Export Control Order 2008
- February 2024 – £971,726.00 was paid relating to the unlicensed exports of military goods controlled by The Export Control Order 2008
- February 2024 – £139,841.85 was paid relating to the unlicensed exports of military goods controlled by The Export Control Order 2008 and dual use goods controlled by Retained Regulation 428/2009
- March 2024 – £92,817.40 was paid relating to the unlicensed exports of military goods controlled by The Export Control Order 2008
- March 2024 – £56,915.27 was paid relating to the unlicensed exports of military goods controlled by The Export Control Order 2008“.

April 22, 2024 by Mark Handley

European Sanctions Enforcement – milestone of over 2000 announced and active investigations reached

With the recent news that Finland has increased the number of its ongoing investigations, Europe (meaning the EU, the UK, Switzerland, etc) has reached the milestone of over 2,000 ongoing and public sanctions enforcement investigations being undertaken by regulators and prosecutors.

No doubt there are other investigations which are ongoing in the countries shown on the graph, and no doubt there are investigations ongoing in countries not shown and which remain confidential.

How many of these will be dropped due to inconclusive evidence or exculpatory evidence, and how many will lead to a conviction or fine or acquittal is impossible to say.

It is, without question, an unprecedented level of enforcement.

April 22, 2024 by Mark Handley

Germany – vessel which had cargo of Russian timber is released

In an earlier post we reported that the German authorities had seized a vessel in the Port of Rostock which was carrying a cargo of sanctioned birch timber from Russia. The planned destination had been the United States where the timber is not sanctioned but the ship had diverted to Rostock seemingly after technical troubles.

The vessel in question, Atlantic Navigator II, has now been allowed to leave Rostock.

The Customs authorities have not stated whether the timber remained on board.

The Rostock Public Prosecutor’s Office is also reported to have confirmed that the matter remains the subject of an ongoing investigation.

April 22, 2024 by Mark Handley

Finland – 40 further EU Russian trade sanctions investigations commenced

At the time of our earlier post in February the Finnish authorities were stating that they had 700 ongoing investigations into alleged breaches of the EU’s trade sanctions against Russia.

It is now being reported that they have “over 740” preliminary investigations into such breaches which suggests that a further 40 investigations have commenced in the interim.

No further details have been published on these new investigations.

April 16, 2024 by Mark Handley

Netherlands – company convicted of sanctions breaches ordered to be liquidated

As per our earlier post, in November last year the Public Prosecution Service in the Netherlands applied to wind up a company convicted of breaching the EU’s sanctions by unlawfully exporting goods to Russia.

Yesterday, the District Court of Gelderland issued its order and judgment in the case. The court granted the application to wind up the company and appointed a liquidator to oversee the process.

The court noted that the company had ceased to trade and that its director and shareholder (also convicted) had fled the Netherlands for Russia.

The court did not grant the Prosecution’s application to immediately turn over all funds in the company’s bank accounts as the proceeds of crime. Rather the court has left the question of what funds are the proceeds of crime “to the liquidator to make an independent assessment”.

The case is an illustration of the powers available to courts post-conviction.

April 12, 2024 by Mark Handley

Poland – sanctions investigation commenced into state-controlled oil trading company

After first being reported by Polish radio station Radio Zet, it is now being reported in the press that the Polish Special Services has commenced an investigation into whether the Swiss oil trading subsidiary of a state-controlled oil company has breached the EU’s Russian sanctions in relation to oil.

The Polish parent company is Orlen, which is 49% owned by the Polish state, and the Swiss subsidiary is Orlen Trading Switzerland.

It is alleged that the Swiss subsidiary was incorporated in Switzerland in late 2022 ahead of the relevant changes to EU sanctions which came into effect in early 2023 as a means of continuing to purchase and trade in oil of Russian origin.

The companies are reported as having denied the allegations.

April 11, 2024 by Mark Handley

Latvia – investigation into bunkering vessel refueling Russian “shadow fleet”

A vessel owned by a Latvian company is providing bunkering (i.e. refueling) services to the Russian “shadow fleet” in the Baltic sea off the coast of Gotland in Sweden.

A spokesman for the Latvian Foreign Ministry has stated that an investigation is now underway to see if the Latvian company is breaching or circumventing EU sanctions, in particular whether the fuel being supplied is of Russian origin.

The Latvian company, Fastbunkering, denies breaching sanctions.

It is noteworthy that just two days ago the Swedish authorities were reported as having closed an investigation into these same possible breaches of sanctions.

A Swedish prosecutor was reported as having stated: “I have made the assessment that it is not worth requesting legal aid from Latvia because it is not expected to lead to a higher penalty than a fine“.

April 11, 2024 by Mark Handley

Cyprus – more than 40 ongoing Russian sanctions investigations and first indictments expected soon

The Cypriot authorities have more than 40 ongoing criminal investigations related to alleged breaches of the EU’s Russian sanctions.

It is being reported that yesterday the current status of “all open cases exceeding 40 were reviewed” by the Law Office and the state’s Attorney General, with the Office for Economic Crime Investigation.

It is also being reported that for the completed investigations “indictments will be prepared to initiate criminal prosecutions in court”.

April 10, 2024 by Mark Handley

Lithuania – Customs Department launches investigation into exports to Russia

Following press reporting into allegations that the Viciūnai Group of companies were exporting sanctioned goods to Russia, it is now being reported that the Lithuanian Customs Department has commenced a pre-trial investigation.

The allegations include that dual use and “battlefield” goods were being exported to a factory in Kaliningrad operated by a related company.

It is reported that the company has confirmed the fact of the exports, but claims that it was not aware that the goods in question (which includes ball bearings, semi-conductors, electrical components and other goods) were subject to sanctions.

April 5, 2024April 5, 2024 by Mark Handley

Germany – Ministry of Economic Affairs calls for investigation into alleged sanctions breaches relating to Mariupol reconstruction

The German Ministry of Economic Affairs and Climate Change is being quoted in the press as having called for an investigation by the relevant authorities into allegations that two German companies may be breaching the EU’s sanctions by providing material for the rebuilding of the occupied city of Mariupol.

The companies, Knauf and WKB Systems GmbH have both issued statements saying they comply with relevant sanctions.

The call for an investigation follows reports of the supply of construction material first published in Monitor.