Evading European sanctions against Russia will become a criminal offense throughout the EU. Individuals and companies that continue to do business with Russia could soon face stiff penalties. The European Parliament has passed a law that makes this possible. EU countries must also take action in this regard and improve control and rules.
With 543 votes in favour, 45 against and 27 abstentions, the European Parliament approved the directive on which an agreement had already been reached with the EU countries. Common minimum sentences will be introduced and the enforcement of sanctions will be fully uniform.
Until now, the EU countries had to do this themselves, which meant that one Member State imposed higher and the other lower penalties. This led to 'forum shopping', with traders and exporters operating from the EU countries with the lowest risk of detection and penalties.
EU penalties and fines can include freezing bank funds and company assets (including crypto assets), bans on travel, arms embargoes, and restrictions on entire industries. Although sanctions are set at the EU level, enforcement by the EU countries will be carried out at the national level.
The new law contains definitions for violations such as transferring money to persons subject to sanctions or doing business with state-owned companies of sanctioned countries. Providing (financial or legal) advisory services in violation of sanctions will also become a punishable offense.
Dutch MEP Sophie in 't Veld, the EP advocate for this law, sees it as an important step to make the thirteen already adopted EU sanctions packages against Russia work better.
“Russian oligarchs still find goat paths in the EU. There remain ways to avoid sanctions and make millions, on the backs of Ukrainians fighting in the trenches or waking up to air raid sirens. Those goat paths will always be there, but providing them by lawyers and financial service providers will become a criminal offense throughout the EU.”
Judges will soon be able to impose prison sentences of up to five years as well as hefty fines. With regard to the latter, EU member states can choose whether a judge can impose a maximum penalty based on a percentage of the global annual turnover of the group or on absolute maximum amounts.