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On 23 July 2026, the European Union adopted the “twenty-first” package of restrictive measures against Russia (the “XXI Package”).

The sanctions package in question is composed as follows:

Below is an overview of the main novelties and amendments introduced in relation to the measures against the Russian Federation and Belarus.

Amendments to Reg. 269/2014

As is well known, the designation of a person or entity under Reg. 269/2014 entails as its principal consequence – as specified by Article 2 of that regulation – the freezing of all funds and economic resources belonging to, owned, held or controlled by such persons or entities. Furthermore, it is prohibited for any person to make, directly or indirectly, funds or economic resources available to designated persons or entities.

New Designations

By Implementing Regulation (EU) 2026/1843 of 23 July 2026, the Council updated Annex I to Reg. 269/2014, adding 48 new natural persons and 168 new entities.

The new designations primarily target the banking sector and a significant number of non-EU entities involved in the circumvention of restrictive measures or in the trade of Russian oil.

Below is an overview of the most relevant designations.

Natural Persons

  • Banking and financial sector. Ruslan Georgievich Arefiev, Chairman of CMRBank, is designated for his role in the financial integration of occupied Ukrainian territories. Sergey Vladimirovich Belov, Deputy Governor of the Central Bank of Russia, is also designated, deemed responsible for the opening of bank branches and the introduction of the rouble in occupied territories. Mikhail Dorofeev, Vice-President of PSB Bank, falls within the same category, having been involved in the expansion of the Russian banking network in occupied territories.
  • Defence industry, UAVs and military supply chain. Alexander Arzamastsev and Alexander Rudik, respectively owner and general director of LLC “ECOPROM”, are designated for their involvement in the production of FPV drones of the “Bekas” series for the Russian armed forces. This category also includes Denis Merzlikin (LLC “ASFPV”) and other individuals linked to SDB “Piranya”, active in the production and supply of FPV drones and components, including fibre-optic spools.
  • Propaganda and disinformation. Alexander Zharov, CEO of Gazprom-Media Holding, is designated for his role in the dissemination of Russian war propaganda. Vladimir Tabak, General Director of ANO Dialog and ANO Dialog of Regions, structures identified as central to Russian disinformation activities, is also designated. Vladimir Medinsky, assistant to Putin, identified as a key figure in propaganda, also falls within this category.
  • Oligarchs and entrepreneurs. Mikhail Gutseriev, a Russian entrepreneur active in the oil and gas, real estate and media sectors through the Safmar Group, is designated. The three co-founders of Svetofor Group – Andrey, Sergey and Valentina Schneider – a retail chain also operating in occupied territories, are likewise designated.
  • Military sector. Roman Demurchiev, a Russian Major General, is designated for serious human rights violations, including torture and executions, in the context of the conflict in Ukraine.
  • Non-Russian subjects. Suniel Kumar Sharma, an Indian national and CEO of Oceaniek International, is designated for his role in managing ship registration services linked to the maritime transport of Russian oil.

Entities

  • Russian banking and financial sector. The XXI Package targets a broad range of Russian banking and financial institutions, including Bank DOM.RF, Rosselkhozbank, OZON Bank, Yandex Bank, Pochta Bank and Genbank. PJSC Moscow Exchange MICEX-RTS (the Moscow Exchange) is also designated as a systemic financial infrastructure of the country.
  • Defence industry, UAVs and components. Numerous companies in the supply chain related to UAV production (in particular the Garpiya-A1 drone) and military components (chemical, electronic, on-board software and testing systems) are designated. These include, by way of example, LLC NTTs VOSTOK (components for UAV warheads), CJSC TECHNOSVYAZ (electronic and optical equipment) and LLC RADIAL FIRM (flight control software for drones). JSC IPK FINVAL, an importer of CNC machine tools usable in military production, is also designated.
  • Energy sector. Several entities in the oil and gas sector are designated, including production, exploration and refining companies, identified as significant sources of revenue for the Russian budget. Among the non-Russian entities is Redwood Global Supply FZ-LLC, a company based in the United Arab Emirates, designated as a significant trader of Russian crude oil and petroleum products transported by sea.
  • Maritime sector and “shadow fleet“. Several shipping, ship management and technical services companies based in India, the United Arab Emirates, Oman, Singapore and China are designated, linked to the transport of Russian oil through high-risk practices such as AIS signal manipulation, ship-to-ship (STS) transfers and deficiencies in insurance coverage.
  • Metallurgy, mining and gold. Extractive and metallurgical companies are designated, including some operating in the occupied Donbass territories, as well as operators in the gold sector, also identified as a significant source of revenue for the Russian State.
  • Technology sector and digital services. Beget LLC, a Russian cloud and web hosting company, is designated for having provided services to organisations operating in illegally annexed territories and to enterprises within the Russian military-industrial complex.

Regulatory Novelties

Regulation (EU) 2026/1844 amends Reg. 269/2014, introducing new derogations from the asset freeze in specific cases, two new full-right exemptions, an expansion of the right to compensation for damages, and a mechanism for the non-recognition of Russian judicial decisions. The main novelties concern a new derogation for insurance payments, a derogation for put option transactions, and two new exemptions relating to JSC Russian Railways and the Paks II Project.

Lastly, paragraph 1 of Article 11a has been replaced, expanding the right to compensation for EU persons in respect of damages suffered in connection with the restrictive measures, and a new Article 11c has been introduced, which expressly prohibits the recognition, implementation and enforcement of Russian judicial and/or arbitral decisions.

Amendments to Reg. 833/2014

Council Regulation (EU) 2026/1848 of 23 July 2026 introduces a broad range of amendments to Reg. 833/2014.

The main novelties are described below by thematic area.

Import Restrictions (Annex XXI)

The XXI Package expands the list of goods in Annex XXI subject to the prohibition on import, purchase or transfer into the Union. The new CN codes include, inter alia: copper ores (CN 2603), nickel (CN 2604) and lead (CN 2607), precious metal ores (CN 2616), zinc oxide and peroxide (CN 2817), chromium oxides and hydroxides (CN 2819), tall oil (CN 3803), glass articles and semi-finished glass products (CN 7001–7020), unwrought zinc (CN 7901), bodies for motor vehicles (CN 8707) and parts and accessories for motor vehicles (CN 8708).

A grandfathering clause applies to such goods: the prohibitions shall not apply until 25 October 2026 to the performance of contracts concluded before 24 July 2026.

Export Restrictions

Annex VII – containing the so-called quasi-dual-use goods subject to the prohibition on sale, supply, export and transfer to Russia – has been expanded with the addition, inter alia, of the following goods:

  • UAV components and counter-UAV systems: servomotors (X.A.VII.004), UAV launch systems (X.A.VII.005), ground support equipment for UAVs (X.A.VII.006), flight termination systems (X.A.VII.007), related software (X.D.VII.003), as well as radio-frequency systems and equipment for counter-UAV functions, including jamming and spoofing systems (Category III – Telecommunications);
  • Advanced materials: high-performance self-adhesive films and tapes (X.C.IX.018) with defined technical parameters, nickel powders and alloys with ≥50% content (X.C.IX.019) and beryllium powder with ≥50% content (X.C.IX.020).

No temporal exemption is provided in relation to these new restrictions.

New entities in Annex IV. 52 new entities have been added to Annex IV of Reg. 833/2014, which lists the persons and entities to which the export of dual-use goods and technologies and of goods that could contribute to the enhancement of Russia’s defence and security sector is prohibited. The entities added include persons active in microelectronics, CNC machine tools and semiconductor equipment sectors, including entities established in third countries involved in circumvention operations.

LNG (Liquefied Natural Gas)

An exemption has been introduced in Article 3ra – which prohibits the purchase, import or transfer of LNG originating in or exported from Russia – for the transport by vessel, technical assistance, brokering services, financing and financial assistance related to such transport, of the products listed in Annex XXIX, Part B (CN 2711.11.00), to the third countries mentioned therein.

Furthermore, the new paragraph 6 of Article 3ra provides for a temporal derogation for transfers and purchases relating to such transfers of Russian LNG destined for third countries in performance of contracts concluded before 24 February 2022.

Furthermore, Article 3rb has been amended, now providing that, as of 1 January 2027, it is prohibited to provide, directly or indirectly, “LNG terminal services” – a category comprising unloading, storage, regasification, tanker truck loading, LNG bunkering and related operations – to persons established in Russia or to persons owned or controlled for more than 50% by Russian nationals or by entities established in Russia. After 1 January 2027, it is also prohibited to maintain contracts relating to such services.

The new Article 3qa introduces an obligation of immediate notification to the competent authorities of any sale or transfer of ownership of LNG tankers (CN code ex 8901 20) to third countries. The notification must include the identity of the seller and buyer, the IMO number and the name of the vessel; the Member State shall inform the other Member States and the Commission within one week.

The Council will review by 25 October 2026 whether to introduce an outright prohibition on such sales.

Oil and Petroleum Products

In relation to the prohibition on the purchase of oil and petroleum products of Russian origin, new authorization-based derogations have been introduced concerning:

  • goods that have been seized, confiscated or that remain under the effective control of a Member State;
  • the obligation to provide proof of the country of origin of crude oil used for refining in a third country, subject to certain conditions;

The automatic update procedure for the Russian oil price cap is suspended from 24 July 2026 to 14 July 2027. An interim review mechanism is provided: by 15 January 2027, the Commission shall communicate to the Council a new price level calculated on the average of the last 22 weeks.

New prohibition on transactions with refineries (Art. 5ae, Annex XLVII, Part D). A prohibition is introduced on conducting transactions with the refineries listed in the new Part D of Annex XLVII, which includes refineries in Russia and in third countries used for the processing, refining or blending of crude oil or products of Annex XXV of Russian origin, or used to facilitate the circumvention of restrictive measures. Among the entities listed in Part D is the Kulevi Oil Refinery (Georgia), with the prohibition taking effect on 25 January 2027.

Maritime Transport

Article 3s is supplemented with the prohibition on providing services, including bunkering and towage, to designated vessels (new letter (h)) and on conducting ship-to-ship transhipments with such vessels (new letter (i)). Annex XLII is expanded with new vessel designations, including vessels involved in oil transport through high-risk practices (AIS manipulation, irregular STS transfers, absence of insurance coverage) and vessels that have provided bunkering or towage to already-designated vessels.

Financial Sector, Payments and Banking System

Several Russian banks are added to Annex XIV, including Energobank, Transcapitalbank, Unistream and Credit Ural Bank. The consequence of inclusion in Annex XIV is the prohibition on conducting any transaction with such institutions. Furthermore, a new derogation has been introduced for transactions strictly necessary to withdraw funds or close accounts held with entities added to Annex XIV from 24 July 2026 onwards, subject to specific conditions.

Crypto-Assets

Article 5b para. 2a is amended: as of 25 August 2026, the prohibition – already in force since 18 January 2024 for crypto-asset wallet, account and custody services – is extended to any other service relating to crypto-assets within the meaning of Regulation (EU) 2023/1114 (MiCA).

Furthermore, the new Article 5bc has been introduced, prohibiting the conduct of transactions with persons or entities established in a third country listed in the new Annex LVII that provide crypto-asset services or operate as crypto-asset exchange or transfer platforms. However, an exemption is provided for transactions carried out by nationals of a Member State who were resident in a listed country prior to the date indicated in the Annex.

Derogations for Divestment and Exit from the Russian Market

The XXI Package extends until 31 December 2027 a series of derogations enabling EU operators to complete an orderly withdrawal from Russia, such as the derogation for transactions strictly necessary for the liquidation of joint ventures or similar arrangements concluded before 16 March 2022 (Art. 5aa).

Jurisdictional Protection of EU Operators

In line with the provisions applicable to Reg. 269/2014, Regulation (EU) 2026/1848 strengthens the protection of EU operators exposed to judicial proceedings brought in third countries, by specifying the scope of the right to compensation for damages (Art. 11a), the non-recognition of Russian judicial and/or arbitral decisions (Art. 11c) and the anti-suit mechanism (Art. 11ca).

Amendments to Reg. 765/2006

The XXI Package intervenes on the sanctions regime against Belarus through two distinct legislative acts: Implementing Regulation (EU) 2026/1817, which updates Annex I to Reg. 765/2006 with new designations, and Regulation (EU) 2026/1846, which amends the substantive provisions of the regulation, introducing new restrictions on goods, services and crypto-assets.

New Designations

Implementing Regulation (EU) 2026/1817 adds two legal persons to Annex I of Reg. 765/2006. These are two entities in the Belarusian oil sector:

  • European Trading Company LLC (ETK), a subsidiary of the Belarusian Oil Company (BNK), created for the sale of petroleum products produced by Naftan and the Mozyr Refinery in Russian territory, indirectly under the control of the Belarusian State;
  • OJSC Mozyr Oil Refinery, one of the two main Belarusian oil refineries, almost entirely owned by the Belarusian State and Slavneft, forming part of the Belneftekhim group and co-owner of BNK.

New Restrictions on Goods

  • New import restrictions (Art. 1ra). Annex XXVII, which contains the list of goods subject to the prohibition on purchase, import or transfer into the Union, is expanded to include multiple new goods, including: copper ores and their concentrates (CN 2603), lead ores and their concentrates (CN 2607), glass articles (CN 7013) and parts and accessories for motor vehicles (CN 8708).
  • New export restrictions (Art. 1f). Annex V a,which contains the list of goods subject to the prohibition on sale, supply, transfer or export to Belarus or for use in Belarus, is expanded to include, inter alia, the following products: nickel powder and its alloys for anti-corrosion coatings of jet engines, beryllium powders for propellants, self-adhesive films for aerospace and defence use, and a series of specific components for drones (UAVs).
  • New entities in Annex V. The list of Belarusian organisations to which the export of dual-use goods and goods that could contribute to military enhancement is prohibited has been expanded to include the following entities: CHIP AND DIP LLC, OJSC Rogachev Plant Diaprojector, DISPLAY DESIGN BUREAU JSC and CJSC “Hull Products Plant”.

New Restrictions on Services and Crypto-Assets

Article 1u, para. 3 has been amended, now providing that, as of 25 August 2026, the prohibition on Belarusian nationals or natural persons resident in Belarus from holding ownership or control of legal persons established in the EU is extended to any entity providing crypto-asset services within the meaning of Regulation (EU) 2023/1114 (MiCAR).

Compensation for Damages in Proceedings Brought in Third Countries

In line with the provisions applicable to Reg. 269/2014, Regulation (EU) 2026/1846 also extends, within the framework of Reg. 765/2006, the possibility for EU persons to obtain compensation for damages – including indirect damages and legal costs – suffered as a result of actions brought by sanctioned persons before courts of third countries, in relation to contracts or transactions affected by the prohibitions of the regulation.

What Should Companies Do?

1. Counterparty Screening

Immediately update screening checks on all commercial and financial counterparties in light of the new designations.

2. Energy and Maritime Transport

  • LNG: from 1 January 2027, prohibition on LNG terminal services to Russian persons; obligation of immediate notification in the event of sale or transfer of LNG tankers.
    • Refineries: prohibition on transactions with refineries listed in Part D of Annex XLVII of Reg. 833/2014.
    • Shipping: update operational procedures and compliance controls in relation to the expansion of Annex XLII and the new prohibitions on the provision of services (bunkering, towage) and ship-to-ship transhipment with designated vessels.

3. Trade Restrictions

  • Review export flows in relation to the expansion of the annexes on prohibited goods (UAV components, counter-UAV systems, advanced materials) and the new entities added to Annex IV of Reg. 833/2014.
    • Update end-use due diligence procedures.
    • Verify the new import/export restrictions introduced by Reg. 765/2006 for Belarus.

4. Exit from the Russian Market

The extension until 31 December 2027 of the derogations for the liquidation of joint ventures and similar contractual arrangements (concluded before 16 March 2022) provides additional time, which should be planned with rigour.

5. Compliance and Organisational Models

Update sanctions compliance programmes and organisational models. Priority should be given to training personnel in high-risk areas.

For further information, please contact:

Gaetano Salvioli, Partner, Bird & Bird

gaetano.salvioli@twobirds.com

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