Written by our Global Sanctions team
On June 10 and 29, 2022, Switzerland expanded existing sanctions and took new measures in response to Russia’s ongoing military aggression in Ukraine. This new package of sanctions is in line with the EU’s sixth package, which was adopted on June 3, 2022. The latest sanctions came into effect on June 29, 2022 at 18:00 CET. On June 10, 2022, Switzerland tightened the existing sanctions against Belarus.
Crude oil and petroleum products ban
The purchase of Annex 24 crude oil and petroleum products originating in or originating from the Russian Federation if Switzerland is the destination, or their importation, transit and carriage in and through Switzerland is prohibited. Related services are also prohibited.
There are three exceptions to this new restriction:
- The restriction does not apply to crude oil and petroleum products transported by sea if these goods only pass through the Russian Federation and their owner is not Russian, or if they originate from the Russian Federation but are legally imported into a member country of the European Union.
- In addition, contracts concluded before June 30, 2022 for the purchase, import, transit and transport of crude oils or oils from bituminous minerals (tariff heading 2709 00) and related services can be executed until December 5, 2022, provided that the Contracts concluded are reported to the Swiss State Secretariat for Economic Affairs (“SECO”) by July 21, 2022. Short-term, one-off delivery transactions of a similar nature can also be carried out until December 5, 2022, provided they are reported to SECO within ten days.
- A similar exception applies to contracts for the purchase, importation, transit and transportation of petroleum or oils derived from other bituminous minerals other than crude oil (tariff 2710) and related services concluded before June 30, 2022 and concluded before June 5, 2022. February 2023, provided that the contracts are reported to SECO by July 21, 2022. Short-term, one-off delivery transactions of the same type can also be carried out up to December 5, 2023, provided they are reported to SECO within 10 days.
The ban on crude oil and petroleum products also applies to related technical, intermediary and financial services and financing, unless the crude oil and petroleum products only pass through the Russian Federation and their owner is not Russian. Contracts concluded before June 30, 2022 can be executed until December 2022.
Ban on providing auditing and tax advisory services
It is prohibited to provide, directly or indirectly, accounting, auditing, including statutory auditing, bookkeeping or tax advice, business and management consulting, or public relations services to the Government of the Russian Federation or any legal person, company or entity incorporated in Russia. For the termination of contracts concluded before June 30, 2022, a settlement period until July 31, 2022 applies.
This restriction does not apply to the provision of services strictly necessary for the exercise of the right to defense in judicial proceedings and the right to an effective remedy and to the provision of services intended for the exclusive use of legal persons, companies or Companies based in the Russian Federation that are owned or controlled solely or jointly by a legal entity, corporation or entity in Switzerland or the EEA. SECO can also grant exceptions for humanitarian and democratic reasons.
Ban on advertising in some Russian media
It is forbidden to promote products or services produced or broadcast on radio and television programs or other electronic content by legal entities, companies or bodies listed in Appendix 25, which include several Russia Today channels, Sputnik, Rossiya RTR , Rosssiya 24 and TV are owned by Center International, regardless of the mode of transmission or broadcast. The Federal Office of Communications (OFCOM) monitors the implementation of this restriction.
Tightening of existing sanctions
Added asset freeze/transit restrictions for Russian individuals and companies and new exemptions
On June 10, 2022, Switzerland imposed additional freeze/transit restrictions on a number of natural and legal persons (listed in Annex 8 of the Regulation in relation to Ukraine). The newly listed legal entities are: JSC Garnizon, JSC Oboronenergo, OJSC Ulyanovsk Automobile Plant, JSC Voentelecom, Voentekstilprom LLC, INDEPENDENT INSURANCE GROUP, JSC Kronshtadt Tekhnologii Group of Companies, Management Company Tatneft-Neftekhim LLC, Nizhnekamsk All-Steel Tire Plant, LLC , LLC TD KAMA, JSC Remdizel, JSC Sukhoi Company, JSC “121 Aircraft Repair Plant” , and National Settlement Depository (“NSD”).
Switzerland also introduced new exemptions from asset freeze restrictions for telecom services. The asset freeze does not apply where the release of frozen assets or economic resources, the transfer of funds, or the making available of such assets or economic resources to an operator located in Switzerland or the European Economic Area (“EEA”) is necessary for the delivery Telecommunications services (i) in the Russian Federation, Ukraine, Switzerland or an EEA Member State, (ii) between the Russian Federation or Ukraine and Switzerland or an EEA Member State, or (iii) for the necessary resources and related services for the operation, maintenance and security of these telecommunications services. Data center services in Switzerland and in the EEA countries are also excluded.
Amendment to the ban on the provision of specialized messaging services (SWIFT)
Three banks were added to the list of companies excluded from SWIFT (Appendix 14) on June 10, 2022: Sberbank, Credit Bank of Moscow and Joint Stock Company Russian Agricultural Bank, JSC.
Added to this is the import ban on a wide range of industrial goods
On June 10, 2022, two additional commodities believed to generate significant revenue for Russia were added to the Schedule 20 list. Sale, supply, export, transit and transport of undenatured ethyl alcohol with an alcohol content of less than 80% vol; Brandy, liqueur and other alcoholic beverages (tariff 2208) and residues from starch manufacture and similar residues, beet pulp, bagasse and other waste from sugar manufacture, brewing residue and distillation residues and waste, including in the form of pellets (tariff 2303) is prohibited.
New Sanction Exceptions
Ban on Direct and Indirect Business with Certain Russian State-Owned Enterprises (“SOEs”)
Switzerland has added further exceptions to the ban on direct and indirect transactions with the state-owned companies listed in Annex 15. This limitation does not apply to receipts of payments due from the listed SOEs for contracts executed before May 15, 2022, and transactions involving sales required before October 22, 2022 for the liquidation of a contract executed before October 26, 2022. Joint ventures established March 2022 or a similar legal form linking a listed SOE.
This limitation also does not apply to transactions related to the provision of telecommunications services or services and equipment necessary for the operation, maintenance and security of telecommunications services, including the provision of firewall and call center services, to those listed Banks, companies or corporations.
Ban on servicing trusts for Russian beneficiaries
The prohibition on servicing trusts for Russian beneficiaries is still in place in the updated regulation. However, for the termination of contracts that were concluded before April 28, 2022, there is now a settlement period until July 31, 2022.
In addition, Switzerland has lifted the ban on acting, or allowing any other person to act, as fiduciary, nominee shareholder, director, secretary or in a similar position for a subject trust or similar legal entity.
In addition, activities that promote democracy and the operation of a foundation or a similar legal form whose purpose is the administration of company pension funds, contract insurance or employee participation plans, or the operation of non-profit organizations, amateur sports clubs and funds for minors or vulnerable adults were situations that led to exceptions by SECO being able to lead.
Ban on accepting deposits and providing cryptocurrency services
The ban on accepting deposits from Russian individuals or legal entities remains unchanged. However, the acceptance of deposit or the provision of cryptocurrency services necessary for the payment of commissions or fees corresponding to the custody or day-to-day management of frozen assets or economic resources has been added as a situation that may give rise to exceptions by SECO.
Tightening of existing sanctions against Belarus
Ban on the provision of specialized messaging services (SWIFT)
Belinvestbank (Belarusian Bank for Development and Reconstruction) was added on June 10, 2022 to the banks listed in Schedule 15 of the Regulation relating to Belarus.
Addition to asset freeze / transit restrictions for Belarusian individuals and companies
On 10 June 2022, Switzerland imposed additional asset freeze/implementation restrictions on a number of natural and legal persons (listed in Schedule 13). The newly listed legal entities are: Open Joint Stock Company “Belaruskali”, Joint Stock Company “Belarusian Potash Company”, “Inter Tobacco” LLC, Open Joint Stock Company “Naftan”, Open Joint Stock Company “Grodno Tobacco Factory Neman”, Beltamozhservice , Open Joint Stock Company “Managing Company of Holding ‘Belkommunmash'” and Belteleradio Company / National State Television and Radio Company of the Republic of Belarus.