Financial and business service measures

Measures targeting the Russian banking sector

Cutting Russia’s access to capital markets of the EU increases borrowing and transaction costs for sanctioned entities and gradually erodes Russia’s industrial base.

Measures include

• a ban on any form of lending to and buying of securities issued by certain Russian banks and government (including the Central Bank)
• a ban on transactions with certain Russian state-owned enterprises across different sectors – the Kremlin’s military-industrial complex
• an export ban on banknotes and the sale of transferable securities in all EU official currencies
• prohibiting the rating of Russia and Russian companies by EU credit rating agencies and the provision of rating services to Russian clients
• a ban on the provision of high-value crypto asset services to Russia and all crypto-asset wallets, irrespective of the amount
• prohibiting business services, directly or indirectly, such as accounting, auditing, statutory audit, bookkeeping and tax consulting services, IT consultancy, legal advisory, architecture and engineering services, management consultancy, public relations, market research and public opinion polling, technical testing and analysis, advertising, and rating services
• a ban on providing advice to wealthy Russians regarding financial planning and trusts and banning their big deposits in EU banks
• prohibiting Russian nationals from governing bodies in Member States’ critical infrastructure
• a ban on transactions with banks and crypto asset providers in Russia and third countries that support Russia’s defence-industrial base
• a ban on transaction with banks and crypto asset providers that participate in the circumvention of the Oil Price Cap by facilitating transactions with the listed vessels of Russia’s shadow fleet
• a ban on transactions with third country banks and crypto asset providers that help circumvent sanctions, support Russia's war of aggression against Ukraine, or are connected to Russia's financial messaging service
• prohibiting transactions via cryptocurrencies, including stablecoins, and offshore exchanges that are used to circumvent sanctions.
• a ban on the provision of certain banking software to the Russian Government and to Russian companies
• a ban on the use of Russia’s payment card and fast payment system (Mir and SBP) 

The EU has imposed assets freezes and financing bans on a number of Russian banks and is blocking Russia’s EU-held foreign exchange reserves by

• excluding key Russian banks from the SWIFT system, the world’s dominant financial messaging system – this measure stops these banks from conducting their financial transactions worldwide in a fast and efficient manner
• banning EU banks outside of Russia from using the financial messaging system SPFS, which is the Russian equivalent of SWIFT
• banning non-Russian third country banks connected to SPFS from doing business with EU operators
• banning investment in projects co-financed by the Russian Direct Investment Fund (RDIF)
• banning EU firms from engaging with any legal person, entity or body in which the RDIF holds any ownership or investments

Measures to protect the EU financial sector

Russia is using litigation and retaliatory measures to seize the assets of EU Central Securities Depositories (CSDs). To address this, the EU has introduced:

• A derogation that enables EU CSDs to request competent authorities of the Member States to unfreeze cash balances and use them to meet their legal obligations with their clients
• A no liability clause for EU CSDs, meaning EU CSDs are not liable to pay interest or any other form of compensation to the Central Bank of Russia, beyond interest contractually due

Measures to protect EU companies

Measures include 

• prohibiting in the EU the recognition or enforcement of some specific rulings issued by Russian courts that give exclusive mandatory competence to Russian courts in disputes between Russian and EU companies. This protects EU companies from the recognition of damages illegally awarded against them in Russia 
• introducing derogations that enable EU companies to divest from Russia