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Russia Sanctions and Related Considerations Toolkit
Practical Law Toolkit w-034-6658 (Approx. 70 pages)
Russia Sanctions and Related Considerations Toolkit
by Practical Law
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A toolkit to help counsel working in the US, UK, EU, Canada, Australia, and New Zealand guide their clients through the business interruptions caused by the war in Ukraine, including key sanctions imposed on Russia and Belarus, persons, and entities. This toolkit covers a wide range of resources, including in the areas of business operations, crisis management and disaster preparedness, cybersecurity, employment matters, financial services, fundraising, insurance, oil and gas, sanctions compliance, supply chain disruptions, and social governance. The Legal Updates in the first section are available without a subscription.
The Russia Sanctions and Related Considerations Toolkit is a collection of resources to assist counsel working across jurisdictions on business interruptions caused by the war in Ukraine, including key sanctions imposed on Russia and Belarus, persons, and entities. The Practice Notes, Standard Clauses, Checklists and other resources in this collection cover a wide range of topics applicable to lawyers and professionals, including in the areas of:
- Business operations and supply chain disruptions (Business Operations and Supply Chain)
- Crisis management and disaster preparedness (Crisis Management and Disaster Preparedness)
- Cybersecurity (Cybersecurity)
- Employment matters (Employment Matters)
- Financial services (Financial Services)
- Fundraising and Cause Marketing (Fundraising and Cause Marketing)
- Insolvency (Insolvency)
- Insurance (Insurance)
- Litigation and dispute resolution (Litigation and Dispute Resolution)
- Oil and gas (Oil and Gas)
- Sanctions compliance (Sanctions Compliance)
- Social governance and corporate policies (Social Governance and Corporate Policies)
Sanctions Legal Updates (No Subscription Required)
Many governments have imposed economic and trade sanctions and export controls on Russia and Belarus in response to the 2022 invasion of Ukraine. To learn the latest information for the UK, the US, and Canada, without a subscription, see the below Legal Updates.
For more information and guidance on sanctions, see Sanctions Compliance.
United Kingdom
For more information on amendments not covered by the list above, see Russia sanctions: UK legislation tracker.
Business Operations and Supply Chain
As a result of the war in Ukraine and the sanctions imposed on Russia and Belarus, organizations may need to evaluate their global supply chain for compliance, manage potential disruptions, and update their commercial contracts' risk allocations. The curated collection of Practice Notes, Standard Clauses, Checklists, Articles, and Quick Compare Charts provides general know-how and guidance on such things as:
- Addressing supply chain compliance by using the contracting process and clauses.
- Handling contract performance issues that arise from extreme events through force majeure clauses.
- Mitigating the effects of business interruptions.
The collection also includes some sanctions-specific resources addressing:
- The impact of these sanctions on UK's Main Market companies (see Practice Note, Russia-Ukraine crisis: impact on LSE Main Market companies).
- The contractual and commercial issues impacting US companies (see Article, Commercial Law Implications of the War in Ukraine and Related Russia Sanctions).
United States
Practice Notes
- For state-specific Practice Notes on force majeure clauses, see Force Majeure Toolkit: Jurisdictional Practice Notes
Standard Clauses
- For state-specific force majeure clauses, see Force Majeure Toolkit: Jurisdictional Standard Clauses
Australia and New Zealand
Practice Notes
- Force majeure (Australia)
- Force majeure (New Zealand)
- Frustration of contracts (Australia)
- Frustration of contracts (New Zealand)
- Termination of contracts (New Zealand)
Standard Documents
- Notice of force majeure event (New Zealand)
- Notice of frustration of contract (New Zealand)
Crisis Management and Disaster Preparedness
Business organizations today operate in a fast-moving, interconnected, global economy. The war in Ukraine and the sanctions imposed on Russia and Belarus can disrupt the supply and production of goods and services even if the business is located far away from the crisis. News of corporate missteps can spread virally in minutes and cause economic harm. To lessen the threat to the viability and integrity of the business, organizations must be prepared to manage and respond to the resulting crisis. The curated collection of Practice Notes and Standard Documents provides information and guidance on drafting and implementing a crisis management plan and assists lawyers to communicate effectively.
Australia and New Zealand
Practice Notes
- How should lawyers prepare for a recession? (Australia)
- How should lawyers prepare for a recession? (New Zealand)
Cybersecurity
Amid a growing risk of Russian cyberattacks, western governments are urging organizations to strengthen their cyber defenses. Despite these efforts a breach may occur, and organizations need to be prepared to respond. The curated collection of Practice Notes, Standard Documents, Checklists, Articles, and Legal Updates provides guidance on preparing and responding to a cyberattack and informs on typical cyber insurance coverage.
United Kingdom
Employment Matters
For those organizations with employees in Ukraine and Russia, the global guide to Employment and Employee Benefits provides a high-level overview of their employment laws. Additionally, the work health and safety (WHS) practice notes provide guidance for workers of Australian organizations working at their direction overseas, such as in Russia or Ukraine.
Specific to the current Russia-Belarus sanctions and Ukraine crisis, the Legal Updates provide the UK's and the US's latest response to the crisis.
Financial Services
Financial institutions must develop and implement compliance programs to prevent money laundering and transacting business with sanctioned persons and entities. To fulfill these obligations financial institutions are required by local regulators to block the accounts and other assets of, and transactions with, sanctioned persons or entities.
Fundraising and Cause Marketing
As a result of the humanitarian crisis unfolding in Ukraine, organizations and their employees are pursuing efforts to support nonprofit organizations assisting refugees and affected Ukrainians. Corporations may assist with direct monetary or in-kind contributions to nonprofit organizations or cause marketing (also known as commercial participator) collaborations.
Corporations and nonprofit organizations must be aware of the regulations that govern fundraising. The curated collection of Practice Notes and Standard Documents provide information and guidance on conducting charitable fundraisers and cause marketing or commercial participator campaigns, including commercial co-ventures, in the US and the UK.
Additionally, the UK's Charity Commission has issued a statement on the implications of the Ukraine crisis for charities, including guidance on running effective and impactful appeals and managing risks when working internationally. The Charity Commission also regulates charitable fundraising by organizations that are not a charity (for profit entities).
Insolvency
The crisis in Ukraine and the sanctions imposed on Russian and Belarus persons and entities may have a detrimental effect on the business operations of businesses in non-sanctioned countries. This may be caused by disruptions in grain supply (as Ukraine is one of the world's largest grain exporters), reliance on sanctioned investors or sanctioned goods (such as Russian oil and gas or luxury goods), or indirectly by the disruptions the war is causing in the world's supply chain.
As a result, impacted businesses may need to avail themselves of insolvency protection laws. The resource collection on foreign insolvency provides in the form of a practice note a guide to the domestic processes and requirements for gaining legal recognition of a foreign insolvency process in 15 jurisdictions.
Additionally, the curated collection of Practice Notes, Checklists, Articles, and Global Guides provides a general know-how and guidance on insolvency and bankruptcy laws of the UK, the US, Canada, and Australia. A US-centric expert Q&A provides insights into the market implications of the Ukraine crisis and Russian sanctions on businesses worldwide.
Insurance
World governments have urged businesses to harden their cyber defenses immediately amid a growing risk of Russian cyberattacks and prepare for direct and indirect economic consequences from the invasion of Ukraine and resulting sanctions. As a result, organizations need to evaluate their insurance policies for protections against cyberattacks, political risk, and supply chain disruptions. For example, a policy on:
- Cyber insurance may provide coverage for cyber losses resulting from Russia-linked attacks.
- Supply chain insurance will protect against losses resulting from disruptions in a company's supply chain
- Political risk insurance may provide coverage for losses due to war, property expropriation, forced abandonment, and currency inconvertibility.
The curated collection of Practice Notes, Standard Clauses, Checklists, and Articles, provide general know-how and guidance on such things as:
- The type of risks covered by insurance and typical exclusions, such as war and terrorism.
- Guidance on handling and managing claims.
Litigation and Dispute Resolution
Participants in an arbitration need to be aware of the various sanctions regimes that may apply to them and to the arbitration to avoid criminal or financial liability for a breach of those sanctions. The Practice Note, Impact of sanctions on arbitration discusses the impact international, US, and UK sanctions have on the arbitration process, jurisdiction, merits, and post-award issues. The collection of curated Russian Practice Notes provide insights into the Russian Federation's litigation and dispute resolution landscape. Additionally, the curated collection of Practice Notes and Global Guides provide general know-how and guidance on a range of topics from litigating to withdrawing as counsel.
Oil and Gas
Sanctions on Russia are having a deep and direct impact on procurement arrangements, joint ventures, joint operating agreements, and other investments in oil and gas. This may result in contract disputes over operating and procurement arrangements, such as currency payments, and increased due diligence. The curated collection of Practice Notes, Standard Documents, Standard Clauses, and Checklists provide general know-how and guidance on a range of topics from insurance against political risks and war to addressing contractual and tortious issues to due diligence considerations for new transactions.
Sanctions Compliance
Doing business in and around conflict zones carries an increased risk that a company's contractual counterparties may become subject to sanctions, rendering performance of the contract illegal. Breaching sanctions regulations risks potential criminal liability, regulatory fines, and forfeiture of goods or profits, as well as loss of existing customers and contracts. To this end, organizations will need to keep up to date with the latest sanctions regulations on Russia, Belarus, and key persons and entities in response to the invasion of Ukraine.
The curated collection of Practice Notes, Standard Documents, Standard Clauses, Checklists, and Toolkits provide general know-how and guidance on financial and trade sanctions compliance considerations, procedures, due diligence, and training. Additionally, it includes sample agreements and clauses ranging from corporate compliance policies to sanctions compliance clauses for commercial agreements.
The collection also includes sanctions-specific resources such as:
- Trackers and Legal Updates that summarize key Russia and Belarus-related economic and trade sanctions and export controls imposed by the UK, the US, and Canada.
- Agencies Implementing Russia Sanctions Chart that contains a reference table of administrative agencies and other governmental authorities in various countries that have implemented sanctions and export controls against Russia and Belarus.
- Practice Note, Russia sanctions and related considerations: key issues for corporate lawyers that summarizes key issues which may impact corporate transactions and other general corporate law, governance, and equity capital markets matters in the UK.
United Kingdom
Articles and Blog Posts
- What happens when sanctions prevent contractual performance? | In-house Blog (practicallaw.com)
Legal Updates
For more information on amendments not covered by the list above, see Russia sanctions: UK legislation tracker.
Legislation
Russia (Sanctions) (EU Exit) Regulations 2019 (SI 2019/855) made for the purpose of encouraging Russia to cease actions destabilising, undermining or threatening the territorial integrity, sovereignty or independence of Ukraine.
Websites
- Financial sanctions are the responsibility of HM Treasury (HMT) and its Office of Financial Sanctions Implementation (OFSI)
- Trade sanctions and export controls are the responsibility of the Department for International Trade (DIT) and its Export Control Joint Unit (ECJU).
- For specific guidance on UK sanctions against Russia, see FCDO: UK sanctions relating to Russia.
United States
European Union
Statutes and Regulations
EU sanctions policy falls within the Common Foreign and Security Policy (CFSP). Sanctions decisions are taken unanimously by the Council of the European Union (Council), on the basis of proposals by the High Representative of the Union for Foreign Affairs and Security Policy (High Representative). Decisions of the Council of the European Union are binding on member states, but are usually accompanied and given effect by EU regulations jointly proposed by the High Representative and the European Commission and adopted by the Council. Individual member states are responsible for the enforcement of sanctions. Some types of sanctions, such as travel bans, fall outside the EU’s competence and must be implemented by individual member states.
For a list of EU sanctions specific to the invasion of Ukraine and other related information, see European Commission: Sanctions adopted following Russia’s military aggression against Ukraine.
Social Governance and Corporate Policies
The war in Ukraine and the sanctions on Russia and Belarus are having an impact on businesses around the world irrespective of location or proximity to the conflict. As a result, organizations need to manage significantly increased risk and grapple with complex ethical issues. The curated collection of social governance and corporate policies provides general know-how and guidance on such topics as managing political engagement, corporate social responsibility policies, and approaches to addressing social responsibility in the supply chain.