Russia takes measures to weather sanctions

The Russian government is reported to have taken additional measures to shore up its finances and prevent flight of capital from the country.

On its Sanctions Blog, law firm Baker McKenzie says that ‘Russian President Vladimir Putin has signed a decree on economic measures against the US, other countries and international organizations who have imposed sanctions on Russia (and are therefore treated by the Russian authorities as unfriendly states).’ According to the blog, amongst retaliatory measures: ‘

1. The following transactions with foreigners affiliated with unfriendly states may be carried out only upon obtaining governmental permits
   • lending to foreigners (in rubles), except otherwise prohibited transactions;
   • transactions (operations) entailing the ownership to securities and real estate (may be also carried out at organized auctions upon obtaining Central Bank permits); and
   • transfer of foreign currency to correspondent accounts in foreign banks, relevant to the above deals.
2. Non-affiliated foreigners handling securities and real estate transactions carried out after February 22, 2022 with foreigners affiliated with unfriendly states and credit organizations are also obliged to perform those transactions along the rules set forth in the Decree.
3. The export of foreign currency in cash in an amount exceeding $ 10,000 is prohibited.’

It notes that the restrictions, in force as from 2 March, do not apply to transactions with the Central Bank and Russian state bodies. The restrictions come into force on 2 March.

The decree is reported to have been published on the Kremlin’s website (www.kremlin.ru) but this is not currently reachable.