Industry News

Russian Aluminum, Copper, and Nickel Prohibition

Apr. 16, 2024
By: Chaney A. Finn

The U.S. Treasury aimed another blow to Russia’s economy by banning Russian aluminum, copper, and nickel produced after April 13th from import into the United States. The announcement is an addition to other economic constraints the U.S. and its allies have issued on Russia in attempt to hinder revenue that could be used to finance the ongoing war in Ukraine.

The minerals have been added to the Treasury Department’s list of goods banned from import into the U.S. as well as the services related to the acquisition of Russian-origin aluminum, copper and nickel, including “warranting services” on a global metal exchange, and “services to acquire aluminum, copper, or nickel of Russian Federation origin as part of a physical settlement of a derivative contract.” However the scope is limited to not include Russian-origin minerals “incorporated or substantially transformed into a foreign-made product,” according to the Office of Foreign Assets Control (OFAC). Regulations that define the specifics of the products and related parties will be published by OFAC in the near future. A similar import ban has been implemented by the U.K.

A statement published by the Treasury Department reads, "As a result of today’s collective actions, metal exchanges, like the London Metal Exchange (LME) and Chicago Mercantile Exchange (CME), will be prohibited from accepting new aluminum, copper, and nickel produced by Russia. Metal exchanges provide a central role in facilitating the trading of industrial metals around the globe. By taking joint action, the United States and UK are depriving Russia and its metals producers of an important source of revenue."

The U.S. Treasury will issue a new general license to allow U.S. persons to “pay taxes, fees, or import duties, and purchase or receive permits, licenses, registrations, certifications, or tax refunds to the extent such transactions are prohibited provided such transactions are ordinarily incident and necessary to the day-to-day operations in the Russian Federation of such U.S. persons or entities, through 12:01 a.m. eastern daylight time, July 11, 2024.” Customs has required production level documentation in conjunction to determine admissibility for prohibited products imported after April 12, 2024.

Should you have questions regarding general licenses, import restrictions, or any other trade-related questions, do not hesitate to contact any attorney at Barnes, Richardson & Colburn, LLP.