Economic sanctions 2024

Since 2014, Russia has lived under international sanctions. The USA, the UK, the EU, Canada, Australia, Switzerland, Norway, Japan, South Korea, Singapura, New Zealand, Iceland, and Lichtenstein introduced restrictive measures.

Sanctions were introduced in 2014 in response to Russia's annexation of Crimea. Sanctions expanded and tightened after the start of a special military operation of Russia in Ukraine in February 2022.

The sanctions include restrictions on the Russian economy's financial, oil and gas, defense, and industrial sectors, air travel, export and import, and media and personal sanctions against Russian ocials, business people, and organizations.

At the end of December 2023, the United States of America and the European Union announced the extension of sanctions against Russia until December 31, 2024.

In turn, Russia also applies retaliatory sanctions. The Russian government has approved a list of "unfriendly" countries, which includes the USA, Great Britain, EU countries, Switzerland, Australia, New Zealand, Micronesia, Canada, Iceland, Norway, the Bahamas, South Korea, Singapore, Taiwan, Montenegro, Monaco, San Marino, North Macedonia and Ukraine.

There is no direct ban on working with partners from unfriendly countries. However, all mutual settlements are complicated by the introduction of strict currency controls and a ban on the export of foreign currency from the Russian Federation.

Residents are prohibited from conducting operations to provide foreign currency to nonresidents under loan agreements. The exception is a loan in foreign currency with the permission of the Government Commission for Control of Foreign Investments in the Russian Federation.

Until September 09, 2024, non-residents from unfriendly countries are prohibited from transferring funds abroad. It does not apply to foreign companies controlled by Russian legal entities or individuals.

Banks from unfriendly countries can transfer funds in rubles through correspondent accounts opened in Russian credit institutions if the payer and recipient have accounts opened in foreign banks

Restrictions on transfers of individuals to foreign accounts have also been extended until September 09, 2024. During a calendar month, an individual has the right to transfer to his account abroad or another individual abroad from his account in Russia no more than 1 million US dollars (or the equivalent in another currency), and without opening an account (through companies providing transfer services) — not more than 10 thousand US dollars (or the equivalent in another currency).

This rule applies only to Russian residents and nonresidents from friendly countries. At the same time, non-residents from any country can transfer wages (payment for work and services) from Russian accounts abroad in rubles and foreign currency and transfer these funds abroad without opening an account if they ocially work in Russia under an employment or civil law contract. Representatives of both friendly and unfriendly countries have this right.

Until April 1, 2024, there is a ban on non-residents from unfriendly countries transferring funds abroad from accounts opened with Russian brokers and trustees. From 04.05.2022, a temporary procedure for fullling obligations to pay dividends, particularly to LLCs to non-resident participants from unfriendly countries, is applied. This temporary procedure involves using type "C" accounts opened for non-residents in authorized banks in rubles. The temporary procedure must be applied when fulfilling obligations exceeding 10 million rubles per calendar month or the equivalent.

Foreign debit and credit cards are not acceptable in Russia, and VISA and Mastercard cards issued by Russian banks are not accepted abroad. The only exception is UnionPay cards issued by certain Russian banks, but they cannot be accepted in every country.

All restrictions are subject to constant updates.

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