Russian banks banned from SWIFT

The EU in consultation with the UK, US and Canada have requested SWIFT, the financial messaging system, to disconnect certain Russian banks from using its system, in response to Russia’s unprovoked military aggression against Ukraine.

On 2 March 2022 the EU formally implemented sanctions (Council Decision (CFSP) 2022/346 & Council Regulation (EU) 2022/345) whereby it shall be prohibited from 12 March 2022 to provide SWIFT services to the following seven Russian banks:

• VTB Bank, Bank Otkritie, Novikombank, Promsvyazbank, Rossiya Bank, Sovcombank, and VEB

or

• to any entity established in Russia and owned (directly or indirectly) by more than 50% by one of the above entities

It will mean that the above banks will be completed prohibited from using SWIFT to send payment messages to any other bank or institution connected to it anywhere in the world.  The EU has warned that they are prepared to add further Russian banks to this list at short notice. 

The sanctions will not enter into force until 12 March in order to allow SWIFT and EU businesses to adapt to these measures. 

The ban excludes Sberbank and Gazprombank. They were exempted because they handle payments related to oil and gas exports on which the EU heavily relies.

Other measures implemented

It is prohibited for anyone subject to the jurisdiction of the EU:

• to sell, supply, transfer or export euro banknotes to Russia or to any person/entity in Russia (including the Russian government), or for use in Russia. There are exceptions related to personal use for people travelling to Russia or for official purposes (diplomatic missions). 
• to invest, participate or otherwise contribute to projects co-financed by the Russian Direct Investment Fund, except where these activities are due under contracts concluded before 2 March 2022.

If members have any queries regarding the above, please contact your usual club contact.

Category: Ukraine / Russia