United States and EU Establish Sanctions Arrangements to Address Ukraine Developments

by Orrick, Herrington & Sutcliffe LLP

The United States and the European Union have issued sanctions measures in response to actions by Ukrainian and Russian officials.  Both measures are designed to impose sanctions against individuals and entities rather than to impose broad trade embargoes.  While the EU has already designated 18 former Ukrainian officials as being sanctioned, initial U.S. designations of sanctioned persons remain forthcoming.

U.S. Executive Order

On March 6, 2014, President Obama issued an executive order authorizing the U.S. Treasury Department to sanction persons found to, among other things, "threaten the peace, security, stability, sovereignty, or territorial integrity of Ukraine," contribute to the "misappropriation of state assets of Ukraine or of an economically significant entity in Ukraine," or "have asserted governmental authority over any part or region of Ukraine without authorization of the Government of Ukraine."

The executive order provides for two types of sanctions.  First, the U.S. government will "block" designated persons.  Blocking will freeze designated persons' assets in the United States or otherwise held by U.S. persons and generally forbid U.S. persons to engage in transactions in which any blocked person has a direct or indirect interest.  This is a standard blacklisting action, which will cut designees off from U.S. business and financial activity.  Second, the U.S. government will subject designated persons to visa bans and generally not permit them to enter the United States.

Again, the U.S. government has not yet designated any persons as being sanctioned under the executive order.  Initial designations could emerge at any time.

EU Regulation

On March 5, 2014, the EU promulgated Council Regulation No. 208/2014.  Also a blocking measure, the regulation freezes the assets of designated individuals linked to or responsible for "the misappropriation of Ukrainian State funds and persons responsible for human rights violations in Ukraine."  EU designees include former Ukrainian President Viktor Yanukovych, former Prime Minister Mykola Azarov, and 16 other senior Ukrainian officials suspected of misusing state funds and violating human rights.  The EU regulation generally forbids dealings with these designated individuals by EU persons.  Unlike the U.S. executive order, the EU regulation does not impose a visa ban.

Key Considerations

U.S. Designations:  There will be no U.S. sanctions until the U.S. government designates persons who are blocked under the executive order.  It seems likely that, unlike the EU, the United States will designate some Russian persons.

Grandfathering:  As usual with U.S. sanctions, sanctions under the executive order will not exempt existing business arrangements.  Rather, to the extent that blocking of designees implicates U.S. persons, those U.S. persons will be forbidden to continue performance of existing arrangements.  By contrast, the EU regulation provides that where payment is due under contracts entered into by designated persons before such persons were included in Annex I of the EU regulation, EU Member States may authorize release of certain frozen funds in specified circumstances.

Other Possible Sanctions:  U.S. and EU authorities continue to engage in vigorous discussions internally and bilaterally about expanded sanctions.  Possibilities include, for example, bans on exports to Ukraine and Russia of military-related and intelligence-related items, sanctions against Russian banks, and limits on government procurement from Russian sources.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Orrick, Herrington & Sutcliffe LLP | Attorney Advertising

Written by:

Orrick, Herrington & Sutcliffe LLP

Orrick, Herrington & Sutcliffe LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.