The European Union is demanding that governments urgently stop the illegal exports of goods to Russia close sanctions loopholes, according to Politico.
Ukrainian experts are constantly finding sanctioned components of Western companies in high-tech Russian weapons that fall into the hands of the Ukrainian military. Russia manages to circumvent the sanctions and import the goods needed to produce weapons.
In a letter from the European Commission, seen by Politico, the EU countries were warned of the need for “immediate, concerted and decisive action” to prevent the flow of Western goods to Russia.
European Commissioner for Finance Mairead McGuinness and European Commissioner for Trade Valdis Dombrovskis, who signed the letter, told Politico they would soon share detailed information on where companies are evading sanctions. McGuinness and Dombrovskis said they would contact the European governments by mid-April to assess the measures taken.
According to the information in the letter from the European Commission, exports of banned goods from the EU to non-EU countries have risen from €3 billion before the full-scale Russian invasion of Ukraine to €5.6 billion by mid-2023. The letter stipulated that this increase compensated for the loss of legal trade in these goods with Russia before the war.
The letter from the European Commission ordered governments of the EU countries to bring to justice EU companies that actively undermine European sanctions and to use penalties to deter such companies from exploiting sanctions loopholes.
According to Politico, the European Commission is studying the possibility of creating an EU body to enforce sanctions, effectively taking this work away from governments. Politico reported that this idea is gaining popularity among EU politicians and may be included in the agenda of European Commission President Ursula von der Leyen if she is appointed for a second term, which will begin by the end of 2024.
European Commissioner for Finance Mairead McGuinness advised EU member states to contact companies involved in producing sanctioned goods to push them to check their supply chains more thoroughly for compliance with EU sanctions rules.
National authorities should share information about non-EU companies and individuals who may be involved in exploiting sanctions loopholes and “exercise particular vigilance” over sanctions exemptions that could make the problem worse, the letter stated, according to Politico.
According to Politico, European Commissioner for Finance Mairead McGuinness will discuss the letter from the European Commission with national ministers of EU member states at a meeting on sanctions on 13 February 2024.