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Russia-Belarus Export Controls/Sanctions Update

6/15/24

By:

NODEC

Latest News

Courtesy of Northern Ohio DEC Member Jon Yormick of Yormick Law LLC


Russia-Belarus Export Controls/Sanctions Update

 Effective 23 January 2024, the US Department of Commerce, Bureau of  Industry and Security (BIS) has published a Final Rule in the Federal  Register that further expands the list of products that are subject to  the Russian and Belarusian Industry Sector Sanctions for which a license  is required for the export, reexport, or transfer (in-country) to or  within Belarus or Russia. The Final Rule was published today, 25 January  2024.   

Background  

Originally,  the Russian Industry Sector Sanctions (RISS) were introduced in 2014 in  response to Russia’s annexation of Crimea and focused on the oil  sector. Since Russia’s aggression against Ukraine, in 2022, BIS amended  the RISS to include Belarus and expand the restrictions to hundreds of  Schedule B numbers and corresponding HTS Codes for a broad range of  items well beyond the oil sector. BIS ultimately removed the US Schedule  B numbers and truncated the HTS Codes to 6-level codes to better align  the HTS Codes with allies and partner of the Global Export Control  Coalition (GECC).

Imposing New Export Controls  

The  latest expansion of the Russian and Belarusian Industry Sector includes  adding 94 6-digit HTS codes to Supplement No. 4 to Part 746 of the  Export Administration Regulations (EAR) to require a license for  exports, reexports, or transfers (in-country) to Russia or Belarus. The  additions include certain chemicals, lubricants, and metals, as well as  the entirety of Chapter 88 of the HTS (Aircraft, spacecraft, and parts  thereof), meaning the Russian and Belarusian Industry Sector Sanctions  cover Chapters 84, 85, 88, and 90, in their entirety. The rule also adds  export controls on certain antennas, antenna reflectors, and parts  thereof covered by HTS Code 852910, which are classified as EAR99.  

In  addition, the action makes changes in the licensing requirements  applicable to Crimea and makes other refinements, including revising  recent restrictions targeting Iran’s supply of UAVs to Russia, and  eliminating the de minimis level for foreign-made items that  incorporate US-origin 9×515 or “600 Series” items when the foreign-made  item is destined for Belarus or Russia.  

The Final Rule  contains a Savings Clause which authorizes the shipment of items  affected by this action that were en route aboard a carrier to a port of  export, reexport, or transfer (in-country), on January 23, 2024,  pursuant to actual orders for export, reexport, or transfer (in-country)  to or within a foreign destination, to proceed to that destination with  No License Required (NLR).  

The full Final Rule, including a list of the added HTS Codes, can be accessed HERE

As  a reminder, for items covered by the HTS Codes in Supplement No. 4, the  license review policy is a “policy of denial.” The primary exceptions  to the license review policy of denial will apply for the export,  reexport, or transfer (in-country) of items that (i) have flight safety  applications or (ii) may be necessary for health and safety reasons or  for items that meet humanitarian needs. These license applications will  be reviewed on a case-by-case review policy “to determine whether the  transaction in question would benefit the Russian or Belarusian  Government of defense sector[.]”   

Pending orders and shipments that are affected by this Final Rule may require companies to declare force majeure (although the license requirement is not expected to be removed in the  near future) or cancel transactions, according to contract terms of  purchase and sale.  

As always, should you have any questions or  require assistance regarding this Final Rule or other Export Controls  and Economic Sanctions matters, please do not hesitate to contact Jon P.  Yormick, jon@yormicklaw.com or M: +1.216.216.5138. 

7/25/24

Cleveland USEAC Upcoming Events Submission Form

If you are interested in having your event included in our “Upcoming Events” email to our clients, please provide the information requested below.

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DEC Member wins prestigious President’s E Award!

DEC member Paul Zito and the Regional Growth Partnership of Northwest Ohio wins the prestigious President’s E Award!

6/15/24

Russia-Belarus Export Controls/Sanctions Update

Courtesy of Northern Ohio DEC Member Jon Yormick of Yormick Law LLC

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