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Insights · Sanctions

EU sanctions against Russia: the ‘no Russia’ clause, best efforts and criminal liability

Dr. Gurgen Petrossian, LL.M. · As of 18.10.2026 · 5 min read

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Image: AI-generated

The framework

The EU’s economic sanctions against Russia are essentially laid down in Council Regulation (EU) No 833/2014. Individual listings with asset freezes follow from Council Regulation (EU) No 269/2014. Since February 2022, Regulation 833/2014 has been continuously extended in packages, most recently by the 20th package through Regulation (EU) 2026/506 of 23 April 2026 and by the 21st package through Regulation (EU) 2026/1848 of 23 July 2026 (EUR-Lex1). According to BAFA, the 21st package entered into force on 24 July 2026 (BAFA, Russland2). In addition, on 12 October 2026 the Council listed a further 826 entities and 743 persons from Russia’s military-industrial complex. They are subject to an asset freeze and to a prohibition on making funds or economic resources available to them; the natural persons are also subject to a travel ban (Council Decision (CFSP) 2026/2279, Council Implementing Regulation (EU) 2026/2281 implementing Regulation (EU) No 269/2014; Council of the EU, 12.10.20263).

Besides the prohibitions themselves, the Regulation now contains a number of obligations that companies must implement organisationally. Three of them are the focus of this post.

Art. 12g: the ‘no Russia’ clause

Since 20 March 2024, anyone selling, supplying, transferring or exporting certain goods to a third country must contractually prohibit re-export to Russia and for use in Russia (Art. 12g(1)). This covers goods and technology listed in Annexes XI, XX and XXXV, the common high priority items listed in Annex XL, and firearms and ammunition listed in Annex I to Regulation (EU) No 258/2012. The partner countries listed in Annex VIII are exempt. The obligation was introduced by the 12th package (Regulation (EU) 2023/2878).

The contracts must provide for adequate remedies in the event of a breach (para. 3). If the exporter becomes aware of a breach by the contracting party, it must inform the competent authority (para. 4). Public contracts with public authorities of third countries or with international organisations are exempt. However, reliance on this exemption must be notified to the authority within two weeks (paras 2a and 2b). Since 26 December 2024, a corresponding clause obligation has applied to intellectual property rights and trade secrets in connection with Annex XL items (Art. 12ga).

Art. 12gb: risk assessment for high priority items

Companies selling or exporting goods listed in Annex XL or Annex XLVIII to third countries other than the partner countries must identify, assess and document the risk of diversion to Russia. They must also implement proportionate policies, controls and procedures to mitigate that risk (Art. 12gb(1)). They must ensure that their subsidiaries outside the EU also comply with these requirements (para. 3). The obligations have applied since 26 December 2024 for Annex XL and since 26 May 2025 for Annex XLVIII.

Art. 8a: ‘best efforts’ for subsidiaries

Irrespective of specific goods, Art. 8a requires EU operators to undertake their best efforts to ensure that entities established outside the EU that they own or control do not participate in activities that undermine the sanctions. The provision was introduced by the 14th package (Regulation (EU) 2024/1745). What ‘best efforts’ means is explained in recital 30 of Regulation (EU) 2024/1745: it covers all actions that are suitable and necessary, but only those that are feasible for the EU operator in view of its nature, its size and the relevant factual circumstances, in particular the degree of effective control over the entity outside the EU. The Commission’s consolidated FAQs (Section 4) give examples of possible measures, such as internal compliance programmes, the sharing of corporate compliance standards, sanctions advisories, mandatory reporting and training. Where an operator is unable to exercise control for reasons it did not cause itself, such as the legislation of a third country, this mitigates its responsibility; according to the FAQs, this does not apply where the loss of control was self-inflicted. The FAQs address Art. 12gb in a separate section (Section 14). The FAQs are not binding; the interpretation of EU law is reserved to the Court of Justice of the EU.

Consequences of breaches in Germany

Under Section 18(1) of the German Foreign Trade and Payments Act (Außenwirtschaftsgesetz, AWG), anyone who breaches a directly applicable prohibition of an EU sanctions regulation, for example in relation to trade in goods, services or the making available of funds, is liable to imprisonment of three months to five years. The attempt is punishable in most cases (Section 18(6) AWG); for particularly serious cases, Section 18(6a) AWG provides for imprisonment of six months to ten years. The competent authorities are BAFA for goods-related measures and the Financial Sanctions Service Centre of the Deutsche Bundesbank for financial sanctions.

Art. 10 of Regulation 833/2014 excludes liability where a person did not know, and had no reasonable cause to suspect, that their actions would infringe the Regulation. This makes traceable documentation of one’s own checks all the more important.

What companies typically examine

  1. Classification of goods: Do exported goods fall under Annexes XI, XX, XXXV, XL or XLVIII?
  2. Contracts: Do contracts with customers in third countries contain the clause under Art. 12g, including remedies?
  3. Risk assessment: Is the diversion risk assessment under Art. 12gb documented and up to date?
  4. Group: How is Art. 8a implemented vis-à-vis subsidiaries outside the EU?
  5. Package monitoring: Who tracks changes introduced by new packages and adapts processes?

On the special case of US sanctions against the International Criminal Court, see our separate post.

This post provides a general overview of the legal position and does not replace legal advice on individual cases.

Sources

  1. Council Regulation (EU) 2026/1848 of 23 July 2026 amending Regulation (EU) No 833/2014 concerning restrictive measures in view of Russia’s actions destabilising the situation in Ukraine (21st package): https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32026R1848 (accessed 18.10.2026) ↩

  2. BAFA, Embargo Russland: https://www.bafa.de/DE/Aussenwirtschaft/Ausfuhrkontrolle/Embargos/Russland/russland_node.html (accessed 18.10.2026) ↩

  3. Council of the EU, press release of 12.10.2026: https://www.consilium.europa.eu/en/press/press-releases/2026/10/12/russia-s-war-of-aggression-against-ukraine-eu-agrees-largest-ever-package-of-listings-targeting-almost-1600-individuals-and-entities-in-russia-s-military-industrial-complex/ (accessed 18.10.2026) ↩

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