By KYIV. Nov 24 (Interfax-Ukraine) – The international working group on sanctions against Russia chaired by Head of the Office of the President of Ukraine Andriy Yermak and Director of the Freeman Spogli Institute for International Studies (FSI), Ambassador Michael McFaul developed measures to counteract the evasion of sanctions.
The document "Measures to improve the effectiveness of sanctions", published on the President’s website, notes that "the catastrophic impact of sanctions on the Russian economy has been mitigated by high oil and gas prices, as well as the existing exceptions and gaps that allow them to be circumvented."
The document proposes a more systematic approach to establishing limits for managing and regulating economic relations with Russia – the "Cold War 2.0" approach. This may involve the introduction of a special trade regime with the Russian Federation in order to minimize trade and block access to Western technologies, markets and finance until the transition to a peaceful foreign policy.
"This is another collective product of the working group, which has a real applied effect: all specific companies, sanctions circumvention schemes, conclusions specified in the document are already being worked out by our partners. We insist on strengthening the sanctions pressure and on introducing the most systemic restrictive approach to the regime of interaction with the terrorist country," Yermak said.
An analysis of the armament of the Russian army in Ukraine shows the wide use of technological components produced in the USA, the Netherlands, Germany, Switzerland, Japan, China and Taiwan.
A partial solution proposes the imposition of sanctions on specific Russian companies, as well as on companies that produce components.
In the financial sphere, intermediaries are used to conceal the ultimate beneficiaries of funds, as well as to introduce additional measures to avoid sanctions.
For example, the Russian oligarch Melnichenko transferred ownership of the Swiss company EuroChem to his wife the day before the EU imposed sanctions on him. Similarly, the Russian oligarch Usmanov transferred considerable assets to one of his sisters, Saodat Narzieva, an obstetrician from Tashkent.
It is also been alleged Russia is building up a shadow fleet of tankers to evade current and forthcoming oil sanctions.
“The tanker fleet of Volga Shipping company, owned by Mr. Lisin – a leading Russian oligarch who has so far only been sanctioned by Australia – has been involved in shipping oil or oil products from Russian ports to a transshipment point 20 nautical miles off them,” the text reads.
The document calls on Western economies to adopt more consistent and comprehensive sanctions, particularly on military enterprises, and to improve the wording of sanctions to close the loopholes that allow such trade.
Sanctions that apply to the UBO and controller of assets should also apply to any nominee who has obtained formal ownership of assets as part of a sanctions evasion strategy.
“Professional advisers who facilitate sanctions evasion should be a primary target for secondary sanctions, including the threat of being barred from practicing for at least several years if they facilitate sanctions violations,” the document reads.
The group proposes that the sanctions coalition draw up a list of violators ("blacklist") of oil transporters, traders, financiers, insurers and technical transport service providers who helped Russia evade the oil embargo.
