Industry News

Joint Action Targets "Third Party Enablers" Supporting Russia's Military Industrial Base

Nov. 18, 2024
By: Ashley J. Bodden


Last month, the Department of Treasury and the Department of State imposed nearly 400 sanctions on entities and individuals across 17 nations, including India, China, and Switzerland for supplying Russia with products and services that enable Russia’s war efforts in Ukraine.

In its unyielding efforts to stop enablers supporting Russia’s military-industrial base, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) sanctioned 275 individuals and entities accused of aiding Russia with advanced technology and equipment. The Treasury Department also targeted more than 150 Russia-based defense and related materiel, technology, manufacturing, and aerospace companies that procure or produce finished military products or key components, precursors, and machinery that enable Russia to build or maintain the weaponry it uses against Ukraine.

Concurrently with the Treasury Department, the State Department imposed sanctions targeting multiple third party countries, including several PRC-based entities in Belarus related to the Lukashenka regime. In addition, the State Department designated more than 120 individuals and entities, in its effort to disrupt the schemes involving the illicit procurement network and the financial facilitators supplying Russia with advanced technology and equipment it needs to support its war in Ukraine. The Department of Commerce also added 40 entities to its Entity List.

Under the joint action, all property and interests in property of those sanctioned that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. Any entities that are owned, directly or indirectly, 50 percent or more by one or more blocked persons are also blocked. All transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or blocked persons are prohibited unless authorized by a general or specific license issued by OFAC, or exempt. Additionally, non-U.S. persons are prohibited from causing or conspiring to cause U.S. persons to wittingly or unwittingly violate U.S. sanctions and engaging in conduct that evades U.S. sanctions.

Last month’s action is the latest in the series of U.S. sanctions imposed on Russian entities and suppliers since the invasion of Ukraine. Treasury’s Deputy Secretary Wally Adeyemo said the U.S. and its allies “are unyielding in our resolve to diminish and degrade Russia’s ability to equip its war machine and stop those seeking to aid their efforts through circumvention or evasion of our sanctions and export controls.” It is likely that more sanctions will come as the war continues, therefore it is extremely important to keep up with US sanction laws.

If you have questions concerning Russia related sanctions or export controls do not hesitate to contact any attorney at Barnes Richardson, & Colburn LLP.